AGREEMENT dated as of the 8th day of February, 2001, by and among TBS
SHIPPING INTERNATIONAL LIMITED, a corporation organized under the laws of
Bermuda (hereinafter referred to as "International"), TBS WORLDWIDE SERVICES
INC., a corporation organized under the laws of the Xxxxxxxx Islands
(hereinafter referred to as "Worldwide") and its direct or indirect
subsidiaries, TBS PACIFIC LINER, LTD., TBS LATIN AMERICA LINER, LTD., TBS NORTH
AMERICA LINER, LTD., TBS EUROLINES, LTD. and TBS OCEAN CARRIERS, LTD., all
corporations organized under the laws of the Xxxxxxxx Islands (hereinafter
collectively referred to as the "Liner Companies"), on the one hand, and TBS
COMMERCIAL GROUP LTD., a corporation organized under the laws of Bermuda
(hereinafter referred to as "Commercial"), and BEACON HOLDINGS LTD., a
corporation organized under the laws of Bermuda (hereinafter referred to as
"Beacon"), on the other.
WHEREAS, the parties desire to formalize their existing agreements and
understandings concerning the performance of commercial, brokerage and port
agency services rendered to the Liner Companies by subsidiaries of Commercial
and Beacon,
NOW, THEREFORE, the parties agree as follows:
1. Engagement. The Liner Companies shall retain the services of the
subsidiaries of Commercial and Beacon listed in Exhibit A attached hereto
(hereinafter referred to as the "Service Subsidiaries") upon the terms and
conditions hereinafter set forth. International and Worldwide further agree that
all their subsidiaries, whether now organized and existing or to be organized
and existing in the future will retain the services of the Service Subsidiaries
upon the terms and conditions hereinafter set forth.
2. Term. The term of this Agreement shall be deemed to have commenced on
January 1, 2000 and shall continue for a period of four years from and after the
later of July 1, 2000 or the effective date of the plan of reorganization
confirmed in International's case under chapter 11 of title 11 of the United
States Code and shall terminate on the fourth anniversary of such effective
date; provided, however, that this Agreement shall continue in effect thereafter
unless 180 days' notice of cancellation is given by either party, which 180
days, notice may be given, at the earliest, 180 days prior to the end of the
original four year term.
Xxxxx Fargo Bank Minnesota, N.A. shall have power of attorney to terminate
this Agreement upon the occurrence of an Event of a Default as defined in the
Amended and Restated Indenture dated as of February 8, 2001, entered into
between TBS Shipping International Limited as issuer and Xxxxx Fargo Bank
Minnesota, N.A. as trustee when such Event of Default has been caused by a
failure to make payment of (a) interest under Section 7.01(i) thereof or (b)
principal under Section 7.01(ii) thereof and upon the giving of an Acceleration
Notice when such Event of Default has been caused by defaults other than a
failure to make payments under either Section 7.01(i) or Section 7.01(ii) of
such indenture. Xxxxx Fargo Bank Minnesota, N.A.'s option to terminate shall not
constitute an obligation to terminate.
3. Scope. During the term of this contract, the Liner Companies, and any
other subsidiary of International and Worldwide, now existing or to be organized
in the future, shall retain the services of the Service Subsidiaries,
exclusively, for the performance of commercial,
brokerage, and port agency services anywhere in the world where a Service
Subsidiary operates and the Service Subsidiaries shall perform such commercial,
brokerage and port agency services as are required by the Liner Companies or
other subsidiaries of International or Worldwide.
4. Compensation. International, Worldwide and the Liner Companies shall pay
to the Service Subsidiaries fees for their services in accordance with the fee
schedule appearing in Exhibit A hereto. Such fees shall remain the same for the
first two years of this Agreement and then will be adjusted in accordance with
the market price for such services for the remaining term of the Agreement,
provided however, that the annual increase shall be subject to the approval of
the board of directors of International.
5. Waiver of Liens. Commercial and Beacon hereby confirm that neither they
nor the Service Subsidiaries have any lien whatsoever against any vessel owned
by any company affiliated with the Liner Companies and all such present and
future liens are irrevocably waived and released, provided however, that, should
this Agreement be terminated, then Commercial, Beacon and/or the Service
Subsidiaries will be entitled to assert any liens that may arise by operation of
law against any such vessel for unreimbursed advances made by them in the
performance of services for the Liner Companies.
6. Governing Law. This Agreement shall be governed by the laws of the State
of New York, without regard to any conflicts-of-law provision which would
require the application of the law of a different jurisdiction.
7. Arbitration. Should any dispute or difference arise between the parties
hereto, such dispute or difference shall be referred to arbitration in New York,
with Commercial, Beacon and the Service Subsidiaries, on the one hand appointing
an arbitrator, and International, Worldwide and the Liner Companies, on the
other, appointing another, and the two arbitrators so appointed appointing a
third one. The decision of a majority of such arbitrators shall be final and
binding on both parties hereto.
8. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed in their corporate name by their corporate officers, as of the day and
year first above written.
TBS SHIPPING INTERNATIONAL LIMITED TBS COMMERCIAL GROUP LTD.
By: By:
----------------------------------- ---------------------------------
Title: Title:
TBS WORLDWIDE SERVICES INC. BEACON HOLDINGS LTD.
By: By:
----------------------------------- ---------------------------------
Title: Title:
TBS NORTH AMERICA LINER, LTD. TBS LATIN AMERICA LINER, LTD.
By: By:
----------------------------------- ---------------------------------
Title: Title:
TBS OCEAN CARRIERS, LTD. TBS PACIFIC LINER, LTD.
By: By:
----------------------------------- ---------------------------------
Title: Title:
TBS EUROLINES, LTD.
By:
-----------------------------------
Title:
3
EXHIBIT A
COMMISSIONS
Each Service Subsidiary shall receive such portion of the total cargo
commissions or other compensation normally payable to a chartering or cargo
broker or commercial agent as it may agree upon with the other participating
chartering or cargo brokers or commercial agents.
PORT AGENCY FEES
COMMISSION
AGENT DESCRIPTION RATE PORT AGENCY FEES
----- ----------- ---- ----------------
AQUARIUS $1,750/call
TECNISEA $1,500/call
LIMA $2,500/call
BRAZIL $4,000/call
BADEMAR Tramp Service
-------------
Eugran $2,500/call
M&R $1,500/call
Liner Service
-------------
Esmeraldes $1,500/call
Guayaquil $1,500/call
PCC/Xxxxxx $1,200/call
A-1
