Common use of Annual Distributions and Transfers Clause in Contracts

Annual Distributions and Transfers. 5.01.1. Each Member hereby acknowledges and agrees that the portion of the Total Allowable Catch (“TAC”) allocated by NMFS to the Sector (the "Annual Catch Entitlement" or “ACE”) shall be harvested in accordance with the Harvest Plan which is set forth as Exhibit B hereto, or as subsequently adopted or amended by the Board or Sector Manager in order to comply with applicable Sector laws and rules. 5.01.2. Each Member agrees to cause its Participating Vessels to, exercise all commercially reasonable efforts to (i) assist in harvesting the regulated species in an amount equal to, but not greater than, the ACE, consistent with the applicable Harvest Plan, and (ii) to comply with all of the other Sector requirements set forth in this Agreement. 5.01.3. The initial Harvest Plan allocates a portion of the Sector’s ACE to each Member in an amount equal to the Member’s Potential Sector Contribution minus a reserve of up to ten percent, established by the Board consistent with the provisions of this Article. 5.01.4. If the Sector ACE is adjusted upward or downward after the commencement of the fishing year, the Board shall have the authority to revise the Harvest Plan and to recalculate the Member allocations to reflect the adjustment and to assure compliance with the Sector ACE and Member allocations. 5.01.5. If the Board determines that the ACE may not be fully harvested during the fishing year, the Board may, subject to the Reserve Provisions of this Article, revise the Harvest Plan, recalculate the Member allocations, and lease the unutilized ACE consistent with applicable NMFS laws and rules, in order to ensure that the ACE is fully harvested. 5.01.6. Members may arrange transfer of their allocations to another Sector Member at any time during the year, with the prior approval of the Sector Manager. 5.01.7. The Sector Manager, with approval of the Board, may arrange for transfer of ACE between or among Sectors at any time during the year. The Sector Manager, at the request of a Sector Member and with the Board’s approval, may arrange for transfer of any Member’s unused allocation to another Sector Member or another Sector at any time during the year. 5.01.8. The Sector will cooperate with the Permit Bank operated by the Penobscot East Resource Center in order to obtain additional ACE to benefit the Sector, but the Penobscot East Resource Center reserves the right to direct the ACE to Members selected by the Center, at the Center’s sole discretion. 5.01.9. In the event of a Member non-approved withdrawal during the Commitment Period under Section 3.03.6, or the expulsion of a Member by the Board under Section 8.03.6, the Board, in its sole discretion, shall establish a fair compensation for the Member’s unused allocation of the Sector ACE, taking into account the following factors: (i) the ability of the Sector’s Members to use the allocation; (ii) the ability to trade the allocation within the Sector or with other Sectors; (iii) any other third party arm’s-length transaction price for transfer of the same stock allocations; and/or (iv) the price actually obtained by Sector Members for fish landed using the re-allocation of the departing Member. Prior to payment of the Board-established compensation to the departing or expelled Member, the Board may set-off from the amount of the compensation all administrative costs incurred by the Sector or its Members in negotiating and closing the transfer transaction, or in defense of any litigation pertaining to the departing Member’s withdrawal or expulsion, or the underlying cause of withdrawal or expulsion. The Sector shall not be obligated to reimburse the departing or expelled Member if the Sector or its Members do not utilize, or do not realize a profit from, the unused allocation of the departing or expelled Member.

Annual Distributions and Transfers. 5.01.1. Each Member hereby acknowledges and agrees that the portion of the Total Allowable Catch (“TAC”) allocated by NMFS to the Sector (the "Annual Catch Entitlement" or “ACE”) shall be harvested in accordance with the initial Harvest Plan which is set forth as Exhibit B hereto, or as subsequently adopted or amended by the Board or Sector Manager in order to comply with applicable Sector laws and rules. 5.01.2. Each Member agrees to cause its Participating Vessels to, exercise all commercially reasonable efforts to (i) assist in harvesting the regulated species in an amount equal to, but not greater than, the ACE, consistent with the applicable Harvest Plan, and (ii) to comply with all of the other Sector requirements set forth in this Agreement. 5.01.3. The initial Harvest Plan allocates a portion of the Sector’s ACE to each Member in an amount equal to the Member’s Potential Sector Contribution minus a reserve of up to ten percent, established by the Board consistent with the provisions of this Article. 5.01.4. If the Sector ACE is adjusted upward or downward after the commencement of the fishing year, the Board shall have the authority to revise the Harvest Plan and to recalculate the Member allocations to reflect the adjustment and to assure compliance with the Sector ACE and Member allocations. 5.01.5. If the Board determines that the ACE may not be fully harvested during the fishing year, the Board may, subject to the Reserve Provisions of this Article, revise the Harvest Plan, recalculate the Member allocations, and lease the unutilized ACE consistent with applicable NMFS laws and rules, in order to ensure that the ACE is fully harvested. 5.01.6. Members may arrange transfer of their allocations to another Sector Member at any time during the year, with the prior approval of the Sector Manager. 5.01.7. The Sector Manager, with approval of the Board, may arrange for transfer of ACE between or among Sectors at any time during the year. The Sector Manager, at the request of a Sector Member and with the Board’s approval, may arrange for transfer of any Member’s unused allocation to another Sector Member or another Sector at any time during the year. 5.01.8. The Sector will cooperate with the Permit Bank operated by the Penobscot East Resource Center in order to obtain additional ACE to benefit the Sector, but the Penobscot East Resource Center reserves the right to direct the ACE to Members selected by the Center, at the Center’s sole discretion. 5.01.9. In the event of a Member non-approved withdrawal during the Commitment Period under Section 3.03.6, or the expulsion of a Member by the Board under Section 8.03.6, the Board, in its sole discretion, shall establish a fair compensation for the Member’s unused allocation of the Sector ACE, taking into account the following factors: (i) the ability of the Sector’s Members to use the allocation; (ii) the ability to trade the allocation within the Sector or with other Sectors; (iii) any other third party arm’s-length transaction price for transfer of the same stock allocations; and/or (iv) the price actually obtained by Sector Members for fish landed using the re-allocation of the departing Member. Prior to payment of the Board-established compensation to the departing or expelled Member, the Board may set-off from the amount of the compensation all administrative costs incurred by the Sector or its Members in negotiating and closing the transfer transaction, or in defense of any litigation pertaining to the departing Member’s withdrawal or expulsion, or the underlying cause of withdrawal or expulsion. The Sector shall not be obligated to reimburse the departing or expelled Member if the Sector or its Members do not utilize, or do not realize a profit from, the unused allocation of the departing or expelled Member.

Annual Distributions and Transfers. 5.01.1. Each Member hereby acknowledges and agrees that the portion of the Total Allowable Catch (“TAC”) allocated by NMFS to the Sector (the "Annual Catch Entitlement" or “ACE”) shall be harvested in accordance with the initial Harvest Plan which is are set forth as Exhibit B hereto, or as subsequently adopted or amended by the Board or Sector Manager in order to comply with applicable Sector laws and rules. 5.01.2. Each Member agrees to, and agrees to cause its Participating Vessels to, exercise all commercially reasonable efforts to (i) assist in harvesting the regulated species in an amount equal to, but not greater than, the ACE, consistent with the applicable Harvest Plan, and (ii) to comply with all of the other Sector requirements set forth in this Agreement. 5.01.3. The initial Harvest Plan allocates a portion of the Sector’s ACE to each Member in an amount equal to the Member’s Potential Sector Contribution minus a reserve of up to ten percent, established by the Board consistent with the provisions of this Article. 5.01.4. If the Sector ACE is adjusted upward or downward after the commencement of the fishing year, the Board shall have the authority to revise the Harvest Plan and to recalculate the Member allocations to reflect the adjustment and to assure compliance with the Sector ACE and Member allocations. 5.01.5. If the Board determines that the ACE may not be fully harvested during the fishing year, the Board may, subject to the Reserve Provisions of this Article, revise the Harvest Plan, recalculate the Member allocations, and lease the unutilized ACE consistent with applicable NMFS laws and rules, in order to ensure that the ACE is fully harvested. 5.01.6. Members may arrange transfer of their allocations to another Sector Member at any time during the year, with the prior approval of the Sector Manager. 5.01.7. The Sector Manager, with approval of the Board, may arrange for transfer of ACE between or among Sectors at any time during the year. The Sector Manager, at the request of a Sector Member and with the Board’s approval, may arrange for transfer of any Member’s unused allocation to another Sector Member or another Sector at any time during the year. 5.01.8. The Sector will cooperate with the Permit Bank operated by the Penobscot East Resource Center in order to obtain additional ACE to benefit the Sector, but the Penobscot East Resource Center reserves the right to direct the ACE to Members selected by the Center, at the Center’s sole discretion. 5.01.9. In the event of a Member non-approved withdrawal during the Commitment Period under Section 3.03.6, or the expulsion of a Member by the Board under Section 8.03.6, the Board, in its sole discretion, shall establish a fair compensation for the Member’s unused allocation of the Sector ACE, taking into account the following factors: (i) the ability of the Sector’s Members to use the allocation; (ii) the ability to trade the allocation within the Sector or with other Sectors; (iii) any other third party arm’s-length transaction price for transfer of the same stock allocations; and/or (iv) the price actually obtained by Sector Members for fish landed using the re-allocation of the departing Member. Prior to payment of the Board-established compensation to the departing or expelled Member, the Board may set-off from the amount of the compensation all administrative costs incurred by the Sector or its Members in negotiating and closing the transfer transaction, or in defense of any litigation pertaining to the departing Member’s withdrawal or expulsion, or the underlying cause of withdrawal or expulsion. The Sector shall not be obligated to reimburse the departing or expelled Member if the Sector or its Members do not utilize, or do not realize a profit from, the unused allocation of the departing or expelled Member.