TRIPARTY AGREEMENT
FOR
DELIVERY OF PERFORMANCE BOND
AND ACCEPTANCE OF VESSEL
This Agreement entered into as of this 1st day of August, 1997 by and
among NAVIGATOR HOLDINGS PLC, ("Navigator" as the "Owner"), CHINA SHIPBUILDING
TRADING COMPANY LIMITED ("CSTC") and JIANGNAN SHIPYARD (collectively with CSTC
as the "Builder") and TRACTEBEL GAS ENGINEERING GMBH ("Tractebel" as the Main
Supplier)
This Agreement is being delivered in connection with five (5) Amended
and Restated Shipbuilding Contracts dated the 26th day of June, 1997 by and
between Navigator and Builder (collectively, "Shipbuilding Contract") as to the
construction of five (5) 22,000 Cubic Meters Liquefied Ethylene Gas Carriers
bearing Hull Nos. 2245, 2246, 2247, 2248 and 2249 (each a "Vessel").
W I T N E S S E T H
NOW THEREFORE, in consideration of the respective representations,
warranties, covenants, agreement and conditions contained herein, and after good
and valuable consideration, the receipt of which is hereby acknowledged, the
parties hereto hereby agree as follows:
1. FINANCIAL GUARANTEES.
(a) The Builder hereby agrees to deliver to Navigator an
Irrevocable Performance Bond which shall guarantee the performances of the
Builder under the Shipbuilding Contract, provided, however the maximum amount to
be drawn under such Performance Bond shall not exceed US$32,474,600 and shall be
substantially in the form attached as Exhibit A to this Agreement which shall
become Exhibit B to the Shipbuilding Contract. The Performance Bond ("Builder
Performance Bond") shall be issued by Export-Import Bank of China, and the cost
of issuance of such Builder Performance Bond shall be borne equally by the
Builder and Navigator, by an adjustment of the Contract Price as to each Vessel.
(b) Tractebel as the Main Supplier agrees to deliver to
Navigator an Irrevocable Performance Bond issued by an Generale de Banque S.A.,
which shall guarantee the performance of the Builder under the Shipbuilding
Contract, provided, however, the maximum amount to be drawn under such
Performance Bond shall not exceed US$16,237,300; provided further, however,
Navigator (or its assignee) shall only be permitted to demand payments under
such Performance Bond after the amounts paid under the Builder Performance Bond
equal to US$32,474,600. The Performance Bond (the "Tractebel Performance Bond")
shall be substantially in the form of Exhibit B to this Agreement which shall
become Exhibit C to the Shipbuilding Contract (as amended to reflect the
obligation of US$16,237,300 and the requirement that a payment in full under the
Builder Performance Bond has been made). Prior to delivery of the Tractebel
Performance Bond, the Builder shall deliver to Tractebel the Payment Guarantees
as set forth in
paragraph (c) below. The cost of issuance of the Tractebel Performance Bond
shall be borne equally by Tractebel and Navigator.
(c) The Builder agrees to deliver to Tractebel Payment
Guarantees covering 95% of the cost of equipment and services to be provided by
Tractebel under the Supply Contract dated February 3, 1997 between the Builder
and Tractebel for supply of the gas plant to be incorporated into the Vessel.
The Payment Guarantee shall be issued by a financial institution acceptable to
Tractebel substantially in the form of Appendix V and Appendix VI set forth in
the Supply Contract. The execution and delivery of the Tractebel Payment
Guarantees by the parties thereto and the payment of the initial installments
due under the Supply Contract by Builder to Tractebel shall be a pre-condition
to Tractebel's obligation to deliver the Tractebel Performance Bond.
2. (a) Article III(1)(a)(iii) of the Shipbuilding Contracts
has been modified and provides that: "If delivery of the VESSEL is delayed for
any reason beyond the Original Delay Period, the Builder may elect to further
postpone the delivery of the Vessel beyond the Original Delay Period until March
31, 2001 provided SELLER pays liquidated damages monthly in advance to the BUYER
at the rate of US$18,000 per day from the end of the Original Delay Period to a
date which is 6 months thereafter (the "First Penalty Date"), and US$20,000 per
day from the First Penalty Date to the date which is 6 months thereafter (the
"Second Penalty Date"), and US$22,000 per day from the Second Penalty Date until
March 31, 2001. If the SELLER fails to make any liquidated damages payment,
BUYER, in its sole discretion, may either (i) reject the VESSEL or (ii) waive
its right to receive the payment of liquidated damages and further reduce the
Contract Price for the VESSEL by an amount equal to the liquidated damages which
would have been payable. Notwithstanding any other provision contained in this
Contract to the contrary, this Contract shall be deemed rescinded on April 1,
2001 and the Buyer shall be entitled to receive the amounts set forth in Article
II, Section 7(a) above.
"Any waiver by the BUYER of its right to receive liquidated
damages monthly in advance is not a waiver of the BUYER's right to (a) demand
payment of such liquidated damages at a later date, (b) demand monthly advances
as to Liquidated Damages for any subsequent months of delay or (c) reject the
VESSEL at such later date if liquidated damages are not paid upon demand. The
liquidated damages calculated pursuant to this paragraph are in addition to the
reduction in the fifth installment of the Contract Price as calculated pursuant
to (ii) above for the Original Delay Period (as such terms are defined in the
Shipbuilding Contracts)."
(b) It is agreed between the Builder and Tractebel that the
liquidated damages to be paid to the Buyer (if any) under Article III, Section
1(a)(iii) of the Shipbuilding Contract shall be shared between the Builder and
Tractebel in the proportion of 2/3 for the Builder and 1/3 for Tractebel except
if the delays causing the liquidated damages are due to force majeure taking
place either in China or in Germany or due to the willful acts of either the
Builder or Tractebel. In case damages resulted from delays caused by force
majeure taking place in Germany or through willful acts by Tractebel, Tractebel
will bear the entire cost of damages. In case the damages result from delays
caused by force majeure in China or through willful acts by the Builder, the
Builder will bear the entire cost of damages. If the Tractebel Performance Bond
is called in part
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or in full, Tractebel shall have the right to obtain from the Builder
reimbursement of the amount paid under the Tractebel Performance Bond that it is
excess of Tractebel's liabilities to the Builder under the contracts between the
Builder and Tractebel and the sharing of liability between the parties shall be
in the proportions set forth above. If the Builder Performance Bond is called in
part or in full, the Builder shall have the right to obtain from Tractebel
reimbursement of the amount paid under the Builder Performance Bond to the
extent such amount is payable under Tractebel liabilities to the Builder under
the contracts between the Builder and Tractebel and the sharing of liability
between the parties shall be in the proportions set forth above.
(c) The Refund Guarantee, Builder Performance Bond and
Tractebel Performance Bond shall expire on May 1, 2001. The Builder hereby
commits itself not to undertake any new building orders from other shipowner
which would interfere with the delivery schedule of the five (5) Vessels.
(d) The Builder hereby agrees to instruct the United States
Trust Company of New York as Collateral Agent (the "Collateral Agent") under the
Collateral Agency and Intercreditor Agreement to pay a portion of the initial
installment due under the Shipbuilding Contracts for Vessels bearing Hull Nos.
2245 and 2246 directly to Tractebel in an amount equal to US$697,500 for Hull
No. 2245 and US$697,500 for Hull No. 2246; which in each case represents 5.0% of
the contract price payable under the purchase contracts between the Builder and
Tractebel for the respective Vessels. The aforementioned payment shall be made
by the Collateral Agent on the Issue Date as defined in the Collateral Agency
and Intercreditor Agreement.
3. LAW APPLICABLE The parties hereto agree that the validity,
enforcement and interpretation of this Triparty Agreement and of each Article
and part hereof be governed by and interpreted in accordance with the Laws of
England.
4. AMENDMENTS No representative of either party shall have authority to
make, and neither party shall be bound by, nor liable for, any statement,
representation, promise or agreement not set forth herein. No changes,
amendments or modifications shall be valid unless reduced to writing and signed
by the parties hereto. In addition the parties hereto further agree that no
changes, amendments or modifications shall be made to the Shipbuilding Contracts
unless such agreement is reduced to writing, signed by the Builder and the Owner
(or its assigns), and consented to by Tractebel.
5. COUNTERPARTS This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all such
counterparts shall together constitute one and the same Agreement.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed on the day and year first above written.
The Owner The Builder
NAVIGATOR HOLDINGS PLC CHINA SHIPBUILDING TRADING
COMPANY, LIMITED
By: /s/ Xxxxxxx Xxxxxx By: /s/ Xxxx Xxxxxx
--------------------------- -------------------------------
Name: Xxxxxxx Xxxxxx Name: Xxxx Xxxxxx
------------------------ -----------------------------
Title: Director Title: Vice President
----------------------- ----------------------------
JIANGNAN SHIPYARD
By: /s/ Gong Jingen
-------------------------------
Name: Gong Jingen
-----------------------------
Title: Vice President
----------------------------
The Main Supplier
TRACTEBEL GAS ENGINEERING
GMBH
By: /s/ Xxxxxxxx Xxxxxxxx
-------------------------------
Name: Xxxxxxxx Xxxxxxxx
-------------------------------
Title: CEO
-------------------------------
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