Exhibit 10.8
PURCHASE AGREEMENT
Dated this day of _____, 2005
BETWEEN:
TEEKAY SHIPPING CORPORATION, a company organized under the laws of the Republic
of The Xxxxxxxx Islands, with its head office at TK House, West Bay St., & Blake
Road, Nassau, The Bahamas (hereinafter "TEEKAY")
AND:
Teekay LNG Operating L.L.C., a limited liability company formed under the laws
of the Republic of The Xxxxxxxx Islands, with its head office at TK House, West
Bay St., & Blake Road, Nassau, The Bahamas, (hereinafter "TEEKAY LNG
OPERATING").
WHEREAS
1. Teekay LNG Operating is the holder of all of the membership
interests in Granada Spirit L.L.C. (the "COMPANY").
2. The Company is the registered owner of the M/T GRANADA SPIRIT (the
"VESSEL").
3. The Vessel is under short-term, fixed rate time charter, dated the
date hereof (the "TIME CHARTER"), to Teekay Chartering Limited (the
"CHARTERER"), a wholly owned subsidiary of Teekay.
4. Teekay and Teekay LNG Operating have agreed that Teekay shall
purchase the Vessel or all of the membership interests in the
Company (at Teekay's election) upon the termination of the Time
Charter.
5. The Time Charter will terminate upon the earliest of (a) delivery to
Teekay LNG Operating or its subsidiary of the newbuilding Toledo
Spirit, (b) December 31, 2005 or (c) the purchase of the Vessel or
the Company in accordance with 1.b(2) below.
1. TEEKAY'S AGREEMENT TO PURCHASE THE VESSEL
Teekay shall purchase the Vessel or all of the membership interests in the
Company (at Teekay's election) upon the termination of the Time Charter and
in accordance with the following:
a PURCHASE ON SCHEDULED DELIVERY DATE
If the Toledo Spirit delivers on the scheduled delivery date of July
20, 2005, Teekay shall:
i) purchase the Vessel (including spares on board and ashore); or
ii) purchase 100% of the membership interests of the Company,
for its own account or name a nominee to purchase the Vessel or the
Company (the "PURCHASE") for a purchase price of US$19,500,000 (the
"PURCHASE PRICE").
b OTHER PURCHASE DATE
(1) If the Toledo Spirit is delivered after July 20, 2005, Teekay shall
complete the Purchase for the Purchase Price less $250,000 per full
month after July 20, 2005 that the Toledo Spirit delivers (or less a
pro rata portion of $250,000 for any portion of any month following
July 20, 2005 that is less than 30 days).
(2) Teekay shall have the right to make the Purchase at any time prior
to the delivery of the Toledo Spirit and cause the Charterer to
terminate the Time Charter. If Teekay exercises this right, or if
the Toledo Spirit delivers prior to July 20, 2005, Teekay will
complete the Purchase for the Purchase Price plus $600,000 for each
full month (or pro rata portion of $600,000 for any pro rata portion
for any period that is less than 30 days) that Teekay LNG Operating
does not have the benefit (directly or indirectly) of the Time
Charter prior to July 20, 2005.
c PURCHASE CONTRACT
FORM OF CONTRACT (VESSEL)
The purchase of the Vessel pursuant to this Agreement will be concluded on
the basis of the Norwegian Shipbrokers' Association's memorandum of
agreement for the sale and purchase of ships as adopted by BIMCO in
"SALEFORM 1993", or such later edition current as of the date of such
purchase, logically amended as appropriate in compliance with this
agreement and including the following other terms:
(1) no drydocking or inspection of underwater parts will be made; and
(2) the Vessel will be taken over "as is, where is" at the time of
completion of the Purchase; and
(3) all property in items such as bunkers, gas oil which prior to
completion of the Purchase are the property of Charterer, shall
remain the property of Charterer.
d FORM OF CONTRACT (COMPANY)
The purchase of 100% of the membership interests of the Company pursuant
to this Agreement will be concluded on the basis of the execution by
Teekay LNG Operating of the Certificate of Limited Liability Interests of
the Company and its transfer of 100% of the membership interests to Teekay
upon payment of the Purchase Price plus or minus any adjustments for the
Purchase before or after July 20, 2005 in accordance with Section 1a and
1b.
e CHARTER TERMINATION
If not previous terminated, the Time Charter will terminate upon closing
of the Purchase.
2. ASSIGNMENT
Teekay may assign any of its rights and obligations contained herein. Assignor
and assignee shall be jointly and severally liable for the performance of the
obligations arising from this Agreement and will execute such undertaking in
writing simultaneously with the assignment. Teekay LNG Operating will cooperate
to the extent required to complete any assignment as and when reasonably
required by Teekay.
3. AMENDMENTS OR WAIVERS
Any waiver or amendment of this Agreement must be specifically stated as such in
writing.
4. GOVERNING LAW AND JURISDICTION
This Agreement shall be governed by and construed under the laws of England. Any
dispute arising out of or in connection with this contract, including any
question regarding its existence, validity or termination, shall be submitted to
the exclusive jurisdiction of the High Court of Justice of England and Wales
sitting in London (England).
In witness whereof, the Parties have signed this document on the date first
above written.
TEEKAY SHIPPING CORPORATION TEEKAY LNG OPERATING L.L.C.
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By: By:
Title: Title:
