Exhibit 99.1
SALEFORM 1993
MEMORANDUM OF AGREEMENT
Dated 22nd February, 2005
Owneast Shipping Limited, Hong Kong
hereinafter called the Sellers, have agreed to sell, and
Castalia Services Ltd, of Monrovia, Liberia
hereinafter called the Buyers, have agreed to buy
Name: m/v FIONA BULKER
Classification Society/Class: NK
Built: 1994 By: Ishikawajima-Harima Heavy Industries, Japan
Flag: Panama Place of Registration: Panama
Call Sign: 3FXJ3 Grt/Nrt: 22,147/12,665
Register Number: IMO Number: 9066758
hereinafter called the Vessel, on the following terms and conditions:
Definitions
"Banking days" are days on which banks are open both in the country of the
currency stipulated for the Purchase Price in Clause 1 and in the place of
closing stipulated in Clause 8.
"In writing" or "written" means a letter handed over from the Sellers to the
Buyers or vice versa, a registered letter, telex, telefax or other modern form
of written communication.
"Classification Society" or "Class" means the Society referred to in line 4.
1. Purchase price USD 25,600,000 cash (United States Dollars twenty five
million, six hundred thousand) only
2. Deposit
As security for the correct fulfilment of this Agreement the Buyers shall pay a
deposit of 10% (ten per cent) of the Purchase Price within 3 (three) banking
days from the date of this Agreement signed by both parties by fax. This deposit
shall be placed with [Bank] and held by them in a interest bearing joint account
for the Sellers and the Buyers, to be released in accordance with joint written
instructions of the Sellers and the Buyers. Interest, if any, to be credited to
the Buyers. Any fee charged for holding the said deposit shall be borne equally
by the Sellers and the Buyers.
3. Payment
The ten (10) per cent deposit is to be released and the balance of the purchase
money together with the payment for lubricants in exchange for the delivery
documents required by the Buyers, shall be paid in full free of bank charges to
[Bank] on delivery of the Vessel, but not later than 3 banking days after the
Vessel is in every respect physically ready for delivery in accordance with the
terms and conditions of this Agreement and Notice of Readiness has been given in
accordance with Clause 5.
4. Inspections
The Buyers have inspected and accepted the vessel during her stay at Houston,
Texas. The Buyers have waived their right to inspect the vessel's NK
classification records. The sale is thereffore "outright" subject only to the
terms and conditions herein provided.
5. Notices, time and place of delivery
a) The Sellers shall keep the Buyers well informed of the Vessel's itinerary
and shall provide the Buyers with 30, 20, 10, 5 and 3 days notice of the
estimated time of arrival at the intended place of underwater
inspection/delivery. When the Vessel is at the place of delivery and in
every respect physically ready for delivery in accordance with this
Agreement, the Sellers shall give the Buyers a written Notice of Readiness
for delivery.
b) The Vessel shall be delivered and taken over charterfree, free of cargo,
free of stowaways, safely afloat at a safe and accessible berth alongside
or anchorage within harbour limits at one safe port within full
ATLANTIC/MED/BLACKSEA/BALTIC/CARIBBEAN range always in the Sellers' option
Expected time of delivery: between 1st April, 2005 and 31st May, 2005 in
the Sellers option.
Date of cancelling (see Clauses 5c), 6b)(iii) and 14): 24:00 hours local
time, 31st May, 2005 in the Buyers option. Sellers undertake to deliver the
Vessel to the Buyers after performing one further voyage after her present
fixture to Nigeria.
c) If the Sellers anticipate that, notwithstanding the exercise of due
diligence by them, the Vessel will not be ready for delivery by the
cancelling date they may notify the Buyers in writing stating the date when
they anticipate that the Vessel will be ready for delivery and propose a
new cancelling date. Upon receipt of such notification the Buyers shall
have the option of either cancelling this Agreement in accordance with
Clause 14 within 7 running days of receipt of the notice or of accepting
the new date as the new cancelling date. If the Buyers have not declared
their option within 7 running days of receipt of the Sellers' notification
or if the Buyers accept the new date, the date proposed in the Sellers'
notification shall be deemed to be the new cancelling date and shall be
substituted for the cancelling date stipulated in line 61.
If this Agreement is maintained with the new cancelling date all other
terms and conditions hereof including those contained in Clauses 5 a) and 5
c) shall remain unaltered and in full force and effect. Cancellation or
failure to cancel shall be entirely without prejudice to any claim for
damages the Buyers may have under Clause 14 for the Vessel not being ready
by the original cancelling date.
d) Should the Vessel become an actual, constructive or compromised total loss
before delivery the deposit together with interest earned shall be released
immediately to the Buyers whereafter this Agreement shall be null and void.
6. Drydocking/Divers Inspection
[a) deleted]
b) (i) The Vessel is to be delivered without drydocking. However, the Buyers
shall have the right at their risk and expense to arrange for an underwater
inspection by a diver approved by the Classification Society prior to the
delivery and at the port of delivery of the Vessel. The Sellers shall at
their cost make the Vessel available for such inspection with NK class
surveyor in attendance onboard the vessel. The extent of the inspection and
the conditions under which it is performed shall be to the satisfaction of
the Classification Society. If the conditions at the port of delivery are
unsuitable for such inspection, the Sellers shall make the Vessel available
at a suitable alternative place near to the delivery port. Class surveyor
shall be the sole arbitrator as to suitability of the place/visibity for
underwater inspect and what constitutes damage that affects vessels clean
certificate of class.
If class surveyor states that damage requires immediate repair then clause
6 of this Memorandum of Agreement shall be fully applicable.
(ii) If the rudder, propeller, bottom or other underwater parts below the
deepest load line are found broken, damaged or defective so as to affect
the Vessel's class, then unless repairs can be carried out afloat to the
satisfaction of the Classification Society, the Sellers shall arrange for
the Vessel to be drydocked at their expense for inspection by the
Classification Society of the Vessel's underwater parts below the deepest
load line, the extent of the inspection being in accordance with the
Classification Society's rules. If the rudder, propeller, bottom or other
underwater parts below the deepest load line are found broken, damaged or
defective so as to affect the Vessel's class, such defects shall be made
good by the Sellers at their expense to the satisfaction of the
Classification Society without condition/recommendation*. In such event the
Sellers are to pay also for the cost of the underwater inspection and the
Classification Society's attendance. If such class condition however only
calls for repair at next scheduled drydocking, the Sellers shall have the
option to deliver the vessel 'as she is' without repairs and to settle in
cash in lieu of repairs of such damage. Such settlement to be based on the
average cost of repairs estimated by two reputable shipyards capable of
drydocking and repairing a vessel of this type, one selected by the Buyers
and one selected by the Sellers. The amount as agreed to be deducted from
the purchase price at the time of delivery.
(iii) If the Vessel is to be drydocked pursuant to Clause 6 b) (ii) and no
suitable drydocking facilities are available at the port of delivery, the
Sellers shall take the Vessel to a port where suitable drydocking
facilities are available, whether within or outside the delivery range as
per Clause 5 b). Once drydocking has taken place the Sellers shall deliver
the Vessel at a port within the delivery range as per Clause 5 b) which
shall for the purpose of this Clause, become the new port of delivery. In
such event the cancellation date provided for in Clause 5 b) shall be
extended by the additional time required for the drydocking and extra
steaming, but limited to a maximum of 14 running days.
c) If the Vessel is drydocked pursuant to Clause 6 a) or 6 b) above
(i) the Classification Society may require survey of the tailshaft system,
the extent of the survey being to the satisfaction of the Classification
surveyor. If such survey is not required by the Classification Society, the
Buyers shall have the right to require the tailshaft to be drawn and
surveyed by the Classification Society, the extent of the survey being in
accordance with the Classification Society's rules for tailshaft survey and
consistent with the current stage of the Vessel's survey cycle. The Buyers
shall declare whether they require the tailshaft to be drawn and surveyed
not later than by the completion of the inspection by the Classification
Society. The drawing and refitting of the tailshaft shall be arranged by
the Sellers. Should any parts of the tailshaft systems be condemned or
found defective so as to the affect the Vessel's class, those parts shall
be renewed or made good at the Sellers' expense to the satisfaction of the
Classification Society without condition/recommendation*.
(ii) the expenses relating to the survey of the tailshaft system shall be
borne by the Buyers unless the Classification Society requires such survey
to be carried out, in which case the Sellers shall pay these expenses. The
Sellers shall also pay the expenses. If the Buyers require the survey and
parts of the system are condemned or found defective or broken so as to
affect the Vessel's class"*.
(iii) the expenses in connection with putting the Vessel in and taking her
out of drydock, including the drydock dues and the Classification Society's
fees shall be paid by the Sellers if the Classification Society issues any
condition/recommendation* as a result of the survey or if it requires
survey of the tailshaft system. In all other cases the buyers shall pay the
aforesaid expenses, dues and fees.
(iv) the Buyers' representative shall have the right to be present in the
drydock, but without interfering with the work or decisions of the
Classification surveyor.
(v) the Buyers shall have the right to have the underwater parts of the
Vessel cleaned and painted at their risk and expense without interfering
with the Sellers' or the Classification surveyor's work, if any, and
without affecting the Vessel's timely delivery. If, however, the Buyers'
work in drydock is still in progress when the Seller's have completed the
work which the Sellers are required to do, the additional docking time
needed to complete the Buyers' work shall be for the Buyers' risk and
expense. In the event that the Buyers' work requires such additional time,
the Sellers may upon completion of the Sellers' work tender Notice of
Readiness for delivery whilst the Vessel is still in drydock and the Buyers
shall be obliged to take delivery in accordance with Clause 3, whether the
Vessel is in drydock or not and irrespective of Clause 5b).
* Notes, if any, in the surveyor's report which are accepted by the
Classification Society without condition/recommendation are not to be taken
into account.
** 6 a) and 6 b) are alternatives; delete whichever is not applicable. In the
absence of deletions, alternative 6 a) to apply.
7. Spares/bunkers, etc.
The Sellers shall deliver the Vessel to the Buyers with everything belonging to
her on board on shore and on order. All grabs on board four (4) in number are
included in sale. All spare parts and spare equipment including spare tail-end
shaft if any, belonging to the Vessel at the time of inspection used or unused,
whether on board or not shall become the Buyers' property. Forwarding charges,
if any, shall be for the Buyers' account. The Sellers are not required to
replace spare parts which are taken out of spare and used as replacement prior
to delivery, but the replaced items shall be the property of the Buyers. The
radio installation and navigational equipment shall be included in the sale
without extra payment. Unused stores and provisions shall be included in the
sale and be taken over by the Buyers without extra payment.
The Sellers have the right to take ashore crockery, plates, cutlery, linen and
other articles bearing the Seller's flag or name, provided they replace same
with similar unmarked items. Library, forms, etc., exclusively for use in the
Sellers' vessel(s), shall be excluded without compensation. Captain's Officers',
managers (it being understood that reasonable managers items to be excluded will
not affect vessels flag or class requirement) and Crew's personal belongings
including the slop chest are to be excluded from the sale, as well as the
following additional items (including items on hire): oxygen/acetylene bottles
which to be removed by the Seller's at their expense prior to delivery.
Loadmaster with relevant programs-software shall be included in the sale.
The following hired items are excluded from the sale:
1. Oxygen bottles - 7 pcs
2. Acetylene bottles - 3 pcs
3. Freon gas bottles - 4 pcs
4. Lap top computer - 4 sets
The Buyers shall take over the remaining bunkers and unused lubricating oils in
storage tanks and sealed drums as onboard at the time of delivery as evidenced
by supporting vouchers. Bunkers and unused lubricating oils to be settled at the
Sellers cost price as evidence by supporting vouchers.
Payment under this Clause shall be made at the same time and place and in the
same currency as the Purchase Price.
8. Documentation.
The place of closing: Nordea Bank, Copenhagen, Denmark
In exchange for payment of the Purchase Price the Sellers shall furnish the
Buyers with delivery documents, as shall reasonably be required by the Buyers
for the purpose of registering the vessel under their intended flag. Such
documents to be mutually agreed and listed as an addendum to this agreement.
At the time of delivery the Buyers and Sellers shall sign and deliver to each
other a Protocol of Delivery and Acceptance confirming the date and time of
delivery of the Vessel from the Sellers to the Buyers.
At the time of delivery the Sellers shall hand to the Buyers the classification
certificate(s) as well as all plans etc., which are on board the Vessel. Other
certificates which are on board the Vessel shall also be handed over to the
Buyers unless the Sellers are required to retain same, in which case the Buyers
to have the right to take copies. Other technical documentation including all
instruction books, manuals, drawings, planned maintenance records etc which may
be in the Sellers' possession both onboard and ashore shall be promptly
forwarded to the Buyers at their expense. The Sellers may keep the Vessel's log
books but the Buyers to have the right to take copies of same. On delivery the
Buyers have the right to take photocopies of the vessel's oil record book and
maintenance books of machineries (main engine/auxiliary engines etc) as
available onboard.
9. Encumbrances
The Sellers warrant that the Vessel, at the time of delivery, is free from all
charters, encumbrances, faxes, mortgages and maritime liens or any other debts
whatsoever. The Sellers hereby undertake to indemnify the Buyers against all
consequences of claims made against the Vessel which have been incurred prior to
the time of delivery.
10. Taxes, etc.
Any taxes, fees and expenses in connection with the purchase and registration
under the Buyers' flag shall be for the Buyers' account, whereas similar charges
in connection with the closing of the Sellers' register shall be for the
Sellers' account.
11. Condition on delivery
The Vessel with everything belonging to her shall be at the Sellers' risk and
expense until she is delivered to the Buyers, but subject to the terms and
conditions of this Agreement she shall be delivered and taken over substantially
in the same condition as when inspected fair wear and tear excepted. However,
the Vessel shall be delivered with her present class maintained free of
recommendations and free of average damage affecting the Vessel's class, and
with her classification certificates and national/international certificates, as
well as clean, valid and unextended for a minimum period of three (3) months
from the date of delivery. Hull and machinery continuous survey cycles, if any,
to be completed and up to date at the time of delivery with no outstandings.
"Inspection" in this Class 11, shall mean the Buyers' inspection according to
Clause 4 a) or 4 b), if applicable, or the Buyers' inspection prior to the
signing of this Agreement. If the Vessel is taken over without inspection, the
date of this Agreement shall be the relevant date.
12. Name/markings
Upon delivery the Buyers undertake to change the name of the Vessel and alter
funnel markings.
13. Buyers' default
Should the deposit not be paid in accordance with Clause 2, the Sellers have the
right to cancel this Agreement, and they shall be entitled to claim compensation
for their losses and for all expenses incurred together with interest.
Should the Purchase Price not be paid in accordance with Clause 3, the Sellers
have the right to cancel the Agreement, in which case the deposit together with
interest earned shall be released to the Sellers. If the deposit does not cover
their loss, the Sellers shall be entitled to claim further compensation for
their losses and for all expenses incurred together with interest.
14. Sellers' default
Should the Sellers fail to give Notice of Readiness in accordance with Clause 5
a) or fail to be ready to validly complete a legal transfer by the date
stipulated in line 61 the Buyers shall have the option of cancelling this
Agreement provided always that the Sellers shall be granted a maximum of 3
banking days after Notice of Readiness has been given to make arrangements for
the documentation set out in Clause 8. If after Notice of Readiness has been
given but before the Buyers have taken delivery, the Vessel ceases to be
physically ready for delivery and is not made physically ready again in every
respect by the date stipulated in line 61 and new Notice of Readiness given, the
Buyers shall retain their option to cancel. In the event that the Buyers elect
to cancel this Agreement the deposit together with interest earned shall be
released to them immediately.
Should the Sellers fail to give Notice of Readiness by the date stipulated in
line 61 or fail to be ready to validly complete a legal transfer as aforesaid
they shall make due compensation to the Buyers for their loss and for all
expenses together with interest if their failure is due to proven negligence and
whether or not the Buyers cancel this Agreement.
15. Buyers' representatives
After this Agreement has been signed by both parties and the deposit has been
lodged, the Buyers have the right to place two representatives on board the
Vessel at their sole risk and expense upon arrival at first port of call. These
representatives are on board for the purpose of familiarisation and in the
capacity of observers only, and they shall not interfere in any respect with the
operation of the Vessel. The Buyers' representatives shall sign the Sellers'
letter of indemnity prior to their embarkation.
16. Arbitration
a)* This Agreement shall be governed by and construed in accordance with
English law and any dispute arising out of this Agreement shall be referred
to arbitration in London in accordance with the Arbitration Acts 1950 and
1979 or any statutory modification or re-enactment thereof for the time
being in force, one arbitrator being appointed by each party. Arbitrators
to be members of the London Maritime Arbitrators Association. On the
receipt by one party of the nomination in writing of the other party's
arbitrator, that party shall appoint their arbitrator within fourteen days,
failing which the decision of the single arbitrator appointed shall apply.
If two arbitrators properly appointed shall not agree they shall appoint a
third arbitrator and the decision of any of two of them shall be final.
*16 a), 16 b) and 16 c) are alternatives; delete whichever is not applicable.
In the absence of deletions, alternative 16 a) to apply.
17. This sale is to be kept strictly private and confidential between the
Buyers, Sellers and brokers involved and is not to be reported.
18. On delivery the Sellers are to hand the Buyers a 'Letter of Undertaking'
stating that to the best of their knowledge vessel is not blacklisted by Arab or
any other nations or organisations.
19. Vessel shall be delivered with swept clean/dry holds.
20. The Sellers crew is Philippino and the Sellers shall retain the liability
for any and all claims, seafarers recruited and deployed by their xxxxxxx agent
may file after the sale and/or delivery of the vessel.
For the Sellers: For the Buyers:
OWNEAST SHIPPING LIMITED, HONG KONG CASTALIA SERVICES LTD, OF MONROVIA,
LIBERIA
Name: /s/ Xxxxxx Xxxxxxx-Xxxxxxxx Name: /s/ Theodoros Konnivis
--------------------------- -------------------------
Xxxxxx Xxxxxxx-Xxxxxxxx Xxxxxxxxx Konnivis
Title: Director Title: Attorney in Fact
23.02.05
16:30 hrs. Local Time (GR)
