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EXHIBIT 10.34.2
Tidewater Marine
February 12, 1996
Horizon Seismic Inc.
00000 Xxxxxxxxxx Xx., Xxxxx 000
Xxxxxxx, XX 00000
Attention: Mr. Xxxxx Xxxxx
Vice President
RE: Time Charter of M/V XXXXXXX TIDE, Official Number 663944
Gentlemen:
Pursuant to the terms and conditions of that certain Blanket Time
Charter dated February 9, 1996, entered into by and between Tidewater Marine,
Inc. ("OWNER") and Horizon Seismic Inc. ("CHARTERER'), this letter sets forth
our understanding and agreement that the above captioned vessel ("the Vessel"),
has been chartered by Owner to Charterer subject to the following:
1. Date of delivery: Delivery is to be on or about March 2, 1996.
2. Location of delivery: Quality Shipyards, Inc., Houma, Louisiana.
3. Location of redelivery: Quality Shipyards, Inc., Houma, Louisiana.
4. Area of Operations/Navigation Limits: Gulf of Mexico.
5. Minimum term of Charter: Six (6) months. Thereafter, unless cancelled
or extended for a specific term, the term hereof shall continue on an
indefinite basis.
6. Termination: After the aforesaid minimum term, unless this Short Form
Charter Agreement be extended for a specific term, OWNER may terminate
this Agreement at any time and for any reason by giving CHARTERER not
less than sixty (60) days' written notice of termination; and
CHARTERER may terminate this Agreement at any time and for any reason
by giving OWNER not less than fifteen (15) days' written notice of
termination. In the event this Short Form Charter Agreement is
terminated at any time prior to the end of the minimum term for any
reason other due to the fault or breach of contract of OWNER,
CHARTERER shall pay to OWNER an early termination fee consisting of
the remaining unamortized balance of the actual cost incurred by OWNER
at the outset of this Short Form Charter Agreement for the
modifications described hereinbelow.
7. Daily charter rate: The Vessel's daily charter rate payable to OWNER
by CHARTERER for its use of the Vessel shall be as follows:
a. Base Rate $3,700/day
b. Extra Crew
x. Xxxx- $ 150/day
ii. Xxxxxxx- $ 100/day
iii. Mate- $ 200/day
c. Modification Fee- $1,094/day
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Total daily charter rate- $5,244/day
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Note, the aforesaid Modification Fee consists of fifty (50%) percent
of the estimated modification cost specified hereinbelow amortized
over the minimum term hereof. Although OWNER and CHARTERER agree to
work closely with each other in order to minimize, as much as
possible, the modification cost, it is understood and agreed that the
estimate is not binding on either party hereto; and OWNER's actual
out-of-pocket expenses incurred in carrying out the modifications
shall be controlling. Therefore, after the actual modification cost
has been fully incurred and calculated, the aforesaid Modification Fee
shall be adjusted to ensure that OWNER's out-of-pocket expenses
incurred in carrying out the modifications are fully reimbursed to
OWNER. OWNER shall provide CHARTERER with reasonable supporting
documentation to verify the final calculation of OWNER's total
out-of-pocket expenses incurred in carrying out the modifications; and
once such costs have been fully amortized, CHARTERER's obligation to
pay the Modification Fee shall lapse.
8. Insured value of vessel: U.S.D. $2,420,000,00.
9. Special Provisions:
A. Special Seismic Modifications: At the outset of this Short
Form Agreement, OWNER shall carry out (or cause to be carried
out) certain modifications to the Vessel in order to permit
CHARTERER to operate the Vessel as a dual streamer seismic
vessel. Those modifications, which are for CHARTERER's
account and are described in more detail in Exhibit "M"
hereto, are estimated to cost $380,552.00. Of that amount, it
is estimated that OWNER will have an out-of-pocket expense of
$215,000 and the components stipulated in Exhibit M as being
provided by Horizon are estimated to cost $165,552.00. Prior
to the modifications being completed and the Vessel going into
service, CHARTERER shall pay to OWNER an "up-front"
modification he of $24,724.00, which consists of fifty (50%)
percent of the total estimated modification cost ($190,276.00)
less the said estimated cost of the Horizon-provided
components ($165,552.00). The said up-front modification fee
also represents the difference between OWNER's aforesaid
estimated out-of-pocket expenses ($215,000.OO) and fifty (50%)
percent of the total estimated modification cost
($190,276.00). As provided for in the note to Clause 7 above,
the remaining balance of OWNER's out-of-pocket modification
cost shall be repaid by CHARTERER to OWNER over the aforesaid
six (6) month minimum charter term, with imputed interest
built in at the rate of one (1%) percent per month on the
unpaid principal. At the conclusion of this Short Form
Agreement, the modifications shall be removed at CHARTERER's
expense; and, in accordance with Article VIII of the
referenced Blanket Time Charter, the Vessel must be restored
to the same condition as it was prior to the installation of
equipment or structural change, normal wear and tear excepted,
all at CHARTERER's expense. All of the equipment and
structural material provided or fully paid for by CHARTERER as
part of the modification costs shall, at the time of removal
from the Vessel at the end of this Short Form Agreement in
accordance with this paragraph, be or become the property of
CHARTERER.
Notwithstanding anything to the contrary contained herein, all
additional modifications and/or equipment installations
requested by CHARTERER that are not specified in Exhibit "M"
for inclusion in the aforesaid cost estimate shall be
considered as separate items and shall be provided and/or
carried out by CHARTERER at its full cost and expense.
B. Meals, Victuals and Lodging: Notwithstanding anything to the
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contrary contained in Article VI of the reference Blanket Time
Charter, CHARTERER agrees that it will provide all victuals
for the Vessel. OWNER will provide a xxxx and a xxxxxxx to
prepare and serve the meals aboard the Vessel; and,
notwithstanding anything to the contrary confined in Article
XVIII. there will be no charge to CHARTERER for meals and
lodging provided by OWNER to Charterer's personnel aboard the
Vessel.
C. Standby Rate: For the time that modifications and/or
additions are being removed from the Vessel for CHARTERER's
account and for the time that modifications and/or additions
are being added to the Vessel for CHARTERER's account at the
beginning of this charter (except during such time as the
Vessel is also undergoing routine, periodic drydocking of the
Vessel for OWNER's own account), CHARTERER shall pay to OWNER
a standby rate of hire in the amount of $3,500 per day plus
the aforesaid Modification Fee, unless the modification cost
has been completely amortized and the obligation to pay the
Modification Fee has lapsed.
D. Crew Size: OWNER agrees that the crew complement required for
the operation of the Vessel, and which shall be furnished by
OWNER and is included in the Vessel's daily charter rate,
shall be a total of eight (8) persons, consisting of: a
master, two (2) mates, a chief engineer, a xxxx/able xxxxxx, a
xxxxxxx/ordinary xxxxxx, an xxxxx, and another able xxxxxx.
E. Except as otherwise provided in this Short Form Agreement,
OWNER, for a period of 180 days, warrants that all work and
installations carried out as part of the above-described
special seismic modifications to the Vessel will be free of
defects in material and workmanship, and all equipment
incorporated into the said special seismic modifications,
except that supplied, chosen or specified by CHARTERER, shall
be of good marine quality. However, OWNER does not warrant
that any material or equipment purchased by it for
installation on the Vessel is free from manufacturer's
defects; and OWNER hereby specifically disclaims any
warranties, expressed or implied, with respect to such
material or equipment. OWNER does hereby extend the
manufacturers warranty or guarantee, if any, to CHARTERER; and
OWNER agrees to use its best efforts and will cooperate with
CHARTERER in order to enforce any claims against the
manufacturers for defects that may occur.
The sole and exclusive remedy of CHARTERER for any warranty
claims under the Short Form Agreement shall be the obligation
of OWNER, during the aforesaid 180 day warrant period, to
repair and/or replace, or cause to be repaired or replaced,
any such defective workmanship or installation of materials
and equipment, provided such defects have not been caused by
the negligence of CHARTERER. In no event shall OWNER be
responsible for any sum in excess of the cost of the repairs
or replacement as specified herein, it being specifically
understood that OWNER is not responsible for delay, demurrage,
loss of profits, loss of use or any other consequential
damages arising in connection with the aforesaid special
seismic modifications to the Vessel.
Some of the equipment to be installed on the Vessel as part of
the above-described special seismic modifications will be
supplied, chosen or specified by CHARTERER and some of it will
be used equipment, perhaps requiring refurbishment or repair
in order to make it operational. It is hereby understood and
agreed that any costs incurred by OWNER in repairing or
refurbishing equipment supplied, chosen or specified by
CHARTERER will be for CHARTERER's
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account as part of the total modification cost. OWNER makes
no representations or warranties, express or implied,
regarding the condition, suitability for the purpose intended
or seaworthiness of the equipment supplied, chosen or
specified by CHARTERER, it being understood and agreed that
OWNER shall employ due diligence to repair, refurbish and
incorporate into the modifications any such equipment
supplied, chosen or specified by CHARTERER. Furthermore, the
repair and/or replacement of any equipment supplied, chosen or
specified by CHARTERER occasioned by latent defects shall be
for CHARTERER's account and any delay of loss of time caused
thereby shall be at CHARTERER's expense and risk.
All other terms and conditions of the referenced Blanket Time Charter
not inconsistent herewith, shall remain as originally written. If the
foregoing meets with your approval, please sign both original counterparts
hereof and return one (1) of them to us for our files.
Yours very truly,
TIDEWATER MARINE, INC.
/s/ Xxxxxxx Xxxxx
Vice President
MQ/ss
Enclosure
Agreed and Accepted
Horizon Seismic, Inc.
By: /s/ X. Xxxxx (X. Xxxxx)
Its: Vice President
PARENT COMPANY GUARANTEE
Exploration Holdings Limited, a U.K. corporation, hereby guarantees
to OWNER (Tidewater Marine, Inc.) the due performance of all of the obligations
of CHARTERER (Horizon Seismic Inc.) under the foregoing short form letter
agreement relating to the time charter of the M/V XXXXXXX TIDE, including,
without limitation, the obligation to make timely charter hire payments.
GUARANTOR:
Exploration Holdings Limited
By: /s/ X.X. Xxxxxxxx
Managing Director
Attest:
/s/ Xxxx A.M. Xxxxxxxx
Corporate Secretary
(Corporate Seal)
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