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EXHIBIT 10.9.8
Dated 15th July, 1994
(1) SIMON-HORIZON LIMITED
(2) HORIZON EXPLORATION LIMITED
SUB-LEASE CONTRACT
Number 2
XXXXXXX & XXXXXXX
00 XXXXXXXX XXXXXX
XXXXXX XX0X 0XX
REF: 5A/P37800/AZM 1030m
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[Contract No: RS920/00171
THIS SUB-LEASE CONTRACT is made the 15th day of July, 1994
BETWEEN:
(1) Simon-Horizon Limited, registered no. 467924, of Xxxxxxx Xxxxx, Xxxxxx
Xxxxx, Xxxxxxx, Xxxx XX0 0XX ("Simon")
(2) Horizon Exploration Limited, registered no. 2804983 of 0 Xxxxxxxx
Xxxx, Xxxxxxxxx, Xxxx XX00 0XX ("the Lessee")
WHEREAS:
(A) Simon has pursuant to a Master Leasing Agreement dated 31st March 1992
between Simon and Royal Bank of Scotland (Industrial Leasing) Limited
(the "Owners") and a lease contract, contract number RS920/0017 (dated
31st March 1992) (together the "RBS Leasing Contracts") between Simon
and the Owner leased from the Owner all the assets and equipment the
subject of this Sub-Lease Contract and it is the intention of Simon
and the Lessee that the Lessee shall enter into this Sub-Lease
Contract upon terms and conditions substantially identical in all
material respects to the terms and conditions of the RBS Leasing
Contract
(B) The parties hereto have entered into a Master Leasing Agreement
("Master Agreement") of even date herewith.
(C) This Lease Contract (incorporating Schedules I, II and III hereto) is
entered into pursuant to the Master Agreement.
NOW IT IS HEREBY AGREED as follows.
1. (a) The terms defined in and for the purposes of the Master
Agreement shall have the same meanings herein.
(b) The provisions of the Master Agreement and any special terms
stated in Schedules II and III hereto shall be deemed to be
incorporated herein. In the event of any conflict between the
provisions of the Master Agreement and the remaining
provisions of this Agreement the latter shall prevail.
2. Simon shall let and the Lessee shall take on lease the Goods as
described in Schedule I hereto.
3. The Original Cost of the Goods exclusive
of recoverable Value Added Tax is L.1,000,212.47
Recoverable VAT is L. 175,037.18
TOTAL COST L.1,175,249.65
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4. (a) The Primary Period shall be deemed to have commenced on 1992
("the Prime Date"), and the last day of this period shall be 1
April 2001.
(b) The Secondary Period shall terminate in accordance with the
provisions of Clause 3.06 of the Master Agreement.
5. (a) The Rentals for the Goods during the Primary Period are
(subject to adjustment pursuant to Clause 5.04 of the Master
Agreement) set out in the table below:
Number of Rental Rental Rental Payments
Rentals Amount Frequency Commencing on
------- ------ --------- -------------
1 L.14,353.05 Monthly 1 May 1992
followed by
109 L.14,363.05 Monthly 1 June 1992
(b) The Rentals for the Goods during the Secondary Period shall be
L.938.10 p.a. All Secondary Period Rentals shall be paid
annually in advance with the first rental payment being due on
April 2001.
(c) Value Added Tax will be applied to the Primary and Secondary
Period Rentals at the applicable rate.
(d) Unless otherwise agreed by Simon the method for payment of
Rentals shall be by Standing Order. Payment of Rentals (and
any other payments falling due) shall be effected for full
value in cleared funds in the hands of Simon on or before the
relevant date of payment; if a date of payment is not a
business day in England then the date for payment shall be
deemed to be the previous such business day occurring.
(e) The bank account of Simon for payment of Rentals and other
amounts due is unless otherwise notified to the Lessee the
account of Royal Bank of Scotland (Industrial Leasing) Limited
account number 00000000 with The Royal Bank of Scotland plc,
00 Xxx Xxxxxxxxx, Xxxxxxxxxx, Xxxxxxxxxxxxxxx, XX00 0XX.
(f) The Rentals and Termination Sums are subject to the Special
Terms set out in Schedules II and III.
6. For the purposes of Clause 5.04 (a) (ii) of the Master Agreement it is
assumed that:
(a) the Owner shall be entitled to capital allowance in respect of
the Original Cost of the Goods namely, Writing Down Allowances
on the reducing balance of Original Cost, on the following
basis.
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Accounting Period Capital Allowances
of Owner Writing Down %
-------- --------------
31 March 1992 25%
(and thereafter)
(b) The Calculation Rates shall be at the rate specified below:
In the period from 01.04.90 xx 00.00.00 34%
01.04.91 xx 00.00.00 33% and
thereafter 33%
7. The Site of the Goods is on the seismic survey vessel the XX Xxxxx
Labrador.
8. If the Lessee acts as sales sub-agent for Simon or agent for the Owner
to dispose of the Goods the Lessee will be entitled to 98% of the net
sales proceeds by way of rebate or rentals under Clause 17.02 of the
Master Agreement. The Sales Agency shall end six months after the
Lease Period expires.
9. The discount rate (referred to in Clause 14.03(b)(ii) of the Master
Leasing Agreement) shall be 5% per annum.
10. This Contract shall be governed by and construed in accordance with
English law.
11. The Lessee's attention is drawn to Clause 5.09 of the Master
Agreement, under with irrespective of the accounting treatment to be
adopted by the Lessee, the Lessee is not entitled to claim capital
allowances on the Goods.
IN WITNESS whereof this Agreement has been entered into the day and year first
before written.
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SCHEDULE I
DESCRIPTION OF GOODS
4 Armoured Tow Leaders
60 Active Sections
15 Digitising Modules
1 Spooler Block
Gun Fish/Float Components
ISC-72 Computer
2 Lead-in Winches
32 RCL-5 Compass/Levellers
1 RTB I/P System
3 HGPS Transceivers
2 XSRS Transceivers
2 Streamer Diverter Bodies
66 Streamer Connections
2 Syntrak Cartridge Drive System
1 Storagetelle Tape Drive Unit
1 Tape Cleaner
1 Syntrak Memory Upgrade
Miscellaneous Small Value Items
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SCHEDULE II
SPECIAL TERMS
The Rentals in this contract are variable for interest throughout the Primary
Period. For the purposes of Clause 5.04 of the Master Agreement each Rental is
based on the assumption that on the first relevant date as shown below the
Sterling London Interbank Rate Offered by The Royal Bank of Scotland plc for
monies of the relevant amount and period at or about 11.00 am ("LIBOR") will be
10% p.a and that on each successive relevant date Three Month Sterling London
Interbank Rate Offered by the Royal Bank of Scotland Plc for monies of the
relevant amount at or about 11 a.m. "LIBOR") on the relevant date as shown
below will be 10% per annum. LIBOR will be conclusively certified by the Owner
to Simon who will notify the Lessee of such certification.
If LIBOR is greater on the relevant date the Lessee shall pay to Simon a
supplemental rental on the settlement date as shown below. If LIBOR is less on
the relevant date Simon shall following receipt of an equal amount from the
Owner pay to the Lessee a rebate of rental on the settlement date. The
supplemental rental or rebate of rental will be calculated by multiplying the
difference between LIBOR on the relevant date and log per annum (rounded to two
decimal places above) by the appropriate rental adjustment factor shown below.
Provided always that if there is any change to the rentals in accordance with
Clause 5.04 of the Master Agreement new rental adjustment factors will be
provided.
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Rental Adjustment Factors
per L.1,000 of Original
Relevant Date Cost for each 1% p.a.
for Setting LIBOR Settlement Date movements in LIBOR
----------------- --------------- ------------------
01.04.92 01.07.92 L.2.52
01.07.92 01.10.92 L.2.50
01.10.92 01.01.93 L.2.46
01.01.93 01.04.93 L.2.14
01.04.93 01.07.93 L.2.14
01.07.93 01.10.93 L.2.10
01.10.93 01.01.94 L.2.05
01.01.94 01.04.94 L.1.86
01.04.94 01.07.94 L.1.86
01.07.94 01.10.94 L.1.80
01.10.94 01.01.95 L.1.74
01.01.95 01.04.95 L.1.60
01.04.95 01.07.95 L.1.57
01.07.95 01.10.95 L.1.52
01.10.95 01.01.96 L.1.45
01.01.96 01.04.96 L.1.36
01.04.96 01.07.96 L.1.30
01.07.96 01.10.96 L.1.24
01.10.96 01.01.97 L.1.18
01.01.97 01.04.97 L.1.10
01.04.97 01.07.97 L.1.04
01.07.97 01.10.97 L.0.97
01.10.97 01.01.98 L.0.89
01.01.98 01.04.98 L.0.84
01.04.98 01.07.98 L.0.77
01.07.98 01.10.98 L.0.69
01.10.98 01.01.99 L.0.60
01.01.99 01.04.99 L.0.57
01.04.99 01.07.99 L.0.49
01.07.99 01.10.99 L.0.40
01.10.99 01.01.00 L.0.30
01.01.00 01.04.00 L.0.29
01.04.00 01.07.00 L.0.20
01.07.00 01.10.00 L.0.10
01.10.00 and thereafter NIL
If any of the above dates are not business days the previous business day will
be used.
The calculation of the supplemental rental or debate of rental are subject to a
minimum LIBOR of 7% per annum.
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SCHEDULE III
Termination Termination Termination Termination
Date Sum Date Sum
----- ---- ----- ---
1 May 1992 1030.49 1 November 1995 754.88
1 June 1992 1026.37 1 December 1995 746.87
1 July 1992 1021.89 1 January 1996 738.97
1 August 1992 1017.76 1 February 1996 731.00
1 September 1992 1013.56 1 March 1996 722.52
1 October 1992 1008.98 1 April 1996 706.91
1 November 1992 1004.70 1 May 1996 698.44
1 December 1992 1000.04 1 June 1996 690.07
1 January 1993 995.64 1 July 1996 681.42
1 February 1993 990.68 1 August 1996 672.87
1 March 1993 984.75 1 September 1996 664.23
1 April 1993 973.17 1 October 1996 655.30
1 May 1993 967.71 1 November 1996 646.48
1 June 1993 962.48 1 December 1996 637.37
1 July 1993 956.89 1 January 1997 628.34
1 August 1993 951.55 1 February 1997 619.29
1 September 1993 946.14 1 March 1997 609.63
1 October 1993 940.38 1 April 1997 593.77
1 November 1993 934.86 1 May 1997 584.23
1 December 1993 928.98 1 June 1997 574.75
1 January 1994 923.31 1 July 1997 565.01
1 February 1994 917.35 1 August 1997 555.32
1 March 1994 910.51 1 September 1997 545.53
1 April 1994 896.88 1 October 1997 535.49
1 May 1994 890.42 1 November 1997 525.49
1 June 1994 884.15 1 December 1997 515.24
1 July 1994 877.54 1 January 1998 505.02
1 August 1994 871.13 1 February 1998 494.82
1 September 1994 864.64 1 March 1998 484.12
1 October 1994 857.82 1 April 1998 468.38
1 November 1994 851.20 1 May 1998 457.70
1 December 1994 844.24 1 June 1998 447.04
1 January 1995 837.45 1 July 1998 436.15
1 February 1995 830.50 1 August 1998 425.26
1 March 1995 822.76 1 September 1998 414.25
1 April 1995 807.83 1 October 1998 403.03
1 May 1995 800.38 1 November 1998 391.79
1 June 1995 793.08 1 December 1998 380.33
1 July 1995 785.46 1 January 1999 368.85
1 August 1995 778.00 1 February 1999 357.44
1 September 1995 770.45 1 March 1999 345.62
1 October 1995 762.59 1 April 1999 330.28
1 May 1999 318.40 1 May 2000 165.73
1 June 1999 306.47 1 June 2000 152.45
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1 July 1999 294.35 1 July 2000 139.01
1 August 1999 282.18 1 August 2000 125.47
1 September 1999 269.88 1 September 2000 111.78
1 October 1999 257.39 1 October 2000 97.93
1 November 1999 244.83 1 November 2000 83.96
1 December 1999 232.09 1 December 2000 69.89
1 January 2000 219.27 1 January 2001 55.76
1 February 2000 206.54 1 February 2001 41.62
1 March 2000 193.57 1 March 2001 27.36
1 April 2000 178.90 1 April 2001 14.36
The Termination Sums detailed above (which are stated per L.1000 of Original
Cost) have been calculated on the basis of the assumptions contained in Clause
5.04(a) of the Master Agreement and Clause 6 of this Sub-Lease Contract. The
Termination Sums also assume that LIBOR in Rental Period during which
termination occurs is 10% per annum, and that termination will occur on one of
the dates detailed above. In the event that a termination occurs on any date
other than a date detailed above, or that any of the other aforementioned
assumptions prove to be incorrect as at the date of termination, with the
result that the Return of the Owner in relation to the Goods in respect of
which such termination has occurred is altered, the amount of the Termination
Sums which falls due on such termination date shall be adjusted upwards or
downwards by such amount required to ensure that the Return of the Owner, in
relation to those Goods, is the same as it would have been had the relevant
assumption (and all other assumptions) proved to be correct.
The above Termination Sums will not apply in the event of the Lessee
repudiating the Master Agreement by a breach of the terms thereof in which case
the terms of Clause 14.03(b) apply. The above Termination Sums have been
calculated on the assumption that the Goods are sold for their tax written down
value in the accounts of the Owner at the time such disposal is completed; in
the event that this assumption proves to be incorrect the above Termination
Sums will be adjusted in such a manner as to maintain the Owner's Return taking
into account the actual disposal proceeds.
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AS WITNESS the hands of the representatives duly authorized on behalf of the
parties hereto the day and year first written above.
SIGNED BY ___________________ SIGNED BY _____________________
SIGNATURE /s/ [illegible signature] SIGNATURE /s/ X.X. Xxxxxxxx
DESIGNATION _________________ DESIGNATION ___________________
for and on behalf of Simon for and on behalf of the Lessee
in the presence of: in the presence of:
WITNESS /s/ Xxxxxx X. Xxxxxx WITNESS /s/ Xxxxxx X. Xxxxxx
*FULL NAME Xxxxxx X. Xxxxxx FULL NAME Xxxxxx X. Xxxxxx
ADDRESS _____________________ ADDRESS _______________________
_____________________________ _______________________________
_____________________________ _______________________________
*Complete name in full in typewriting or block capitals
Note
Lessee must complete acceptance certificate overleaf.
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ACCEPTANCE CERTIFICATE
Attachment to Sub-Lease Contract
To be completed by the Lessee in Duplicate (where required)
From:
Name in Full Horizon Exploration Limited
Business The Provision of Geophysical Services
Address 6 Pembroke Road
Sevenoaks
Kent TN 13 1XR
Bankers
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Insurance Broker
or Company
---------------------------------------------
Address
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To Simon-Horizon Limited
We hereby confirm and certify to you that:
(i) We have duly received the Goods and we hereby acknowledge that these
goods are the Goods referred to in Schedule I to the Sub-Lease
Contract detailed below;
(ii) We have duly inspected the Goods on at and we are
satisfied that the Goods are complete and the Goods are in all
respects in good working order and condition;
(iii) All safety regulations in relation to the Goods have been complied
with and all required or recommended safety apparatus or appliances
(if any) have been correctly installed or supplied with the Goods as
the case may be;
(iv) Insurance cover in respect of the Goods has been effected in
accordance with the terms of the Master Agreement.
Description of Goods
As per Schedule I to the said Sub-Lease Contract No. 2 dated 15th July
1994
For and on behalf of Horizon Exploration Limited.
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Dated
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