EXHIBIT (10(g)
TIME CHARTER OF
S/S ENERGY INDEPENDENCE
BETWEEN
INTERNATIONAL SHIPHOLDING CORP., OR NOMINEE
AS OWNER, AND
NEW ENGLAND POWER COMPANY, OR NOMINEE
AS CHARTERER
DATED AS OF
INDEX TO TIME CHARTER
Page
1. PERIOD. . . . . . . . . . . . . . . . . . . . . . . . 1
2. DELIVERY/REDELIVERY EVENTS. . . . . . . . . . . . . . 2
3. CLASSIFICATION OF VESSEL. . . . . . . . . . . . . . . 2
4. BUNKER COAL AND FUEL OIL. . . . . . . . . . . . . . . 3
5. DESCRIPTION OF VESSEL . . . . . . . . . . . . . . . . 5
6. CONDITION OF VESSEL . . . . . . . . . . . . . . . . . 8
7. SUEZ/PANAMA CANALS. . . . . . . . . . . . . . . . . . 9
8. CARGOES . . . . . . . . . . . . . . . . . . . . . . . 9
9. TRADING LIMITS. . . . . . . . . . . . . . . . . . . . 10
10. RATE OF HIRE. . . . . . . . . . . . . . . . . . . . . 10
11. PAYMENT OF HIRE . . . . . . . . . . . . . . . . . . . 12
12. LOSS OF VESSEL. . . . . . . . . . . . . . . . . . . . 12
13. FINAL VOYAGE. . . . . . . . . . . . . . . . . . . . . 12
14. LIENS . . . . . . . . . . . . . . . . . . . . . . . . 13
15. SPACE AVAILABLE TO CHARTERER. . . . . . . . . . . . . 13
16. ANNUAL DAYS OF USE BY CHARTERER . . . . . . . . . . . 13
17. OWNER TO PROVIDE. . . . . . . . . . . . . . . . . . . 14
18. CHARTERER TO PROVIDE. . . . . . . . . . . . . . . . . 14
19. BUNKER COAL AND FUEL OIL AT DELIVERY AND REDELIVERY
EVENTS. . . . . . . . . . . . . . . . . . . . . . . . 14
20. DUTIES OF MASTER. . . . . . . . . . . . . . . . . . . 15
21. INSTRUCTIONS AND LOGS/CHARTER ADMINISTRATION. . . . . 15
22. CONDUCT OF VESSEL'S PERSONNEL . . . . . . . . . . . . 16
23. BILLS OF LADING . . . . . . . . . . . . . . . . . . . 16
24. SCHEDULED OVERHAUL. . . . . . . . . . . . . . . . . . 17
25. NEGLIGENCE OF PILOTS, ETC.. . . . . . . . . . . . . . 17
26. TUGBOATS. . . . . . . . . . . . . . . . . . . . . . . 18
27. EQUIPMENT . . . . . . . . . . . . . . . . . . . . . . 18
28. SALVAGE . . . . . . . . . . . . . . . . . . . . . . . 19
29. POLLUTION FINANCIAL RESPONSIBILITY. . . . . . . . . . 19
30. EXCEPTIONS. . . . . . . . . . . . . . . . . . . . . . 20
31. WAR CLAUSE. . . . . . . . . . . . . . . . . . . . . . 20
32. ADDITIONAL COST OF HOSTILITIES. . . . . . . . . . . . 21
33. REQUISITION . . . . . . . . . . . . . . . . . . . . . 21
34. DEMISE. . . . . . . . . . . . . . . . . . . . . . . . 21
35. WAR RISKS . . . . . . . . . . . . . . . . . . . . . . 22
36. BOTH-TO-BLAME . . . . . . . . . . . . . . . . . . . . 23
37. NEW JASON CLAUSE. . . . . . . . . . . . . . . . . . . 23
38. CLAUSE PARAMOUNT. . . . . . . . . . . . . . . . . . . 24
39. LAWS. . . . . . . . . . . . . . . . . . . . . . . . . 24
40. BENEFIT OF LIMITATIONS. . . . . . . . . . . . . . . . 24
41. ARBITRATION . . . . . . . . . . . . . . . . . . . . . 25
42. BROKER'S COMMISSIONS. . . . . . . . . . . . . . . . . 25
43. INSPECTION AND SUPERCARGOES . . . . . . . . . . . . . 25
44. SUBCHARTER. . . . . . . . . . . . . . . . . . . . . . 26
45. RESTRICTIONS ON USE OF VESSEL . . . . . . . . . . . . 26
46. OPERATIONAL AND COMMERCIAL OFF-HIRE . . . . . . . . . 26
47. ATTACHMENT, ARREST, ETC.. . . . . . . . . . . . . . . 28
48. ASSIGNMENTS . . . . . . . . . . . . . . . . . . . . . 29
49. WAR RISK INSURANCE. . . . . . . . . . . . . . . . . . 29
50. ICE SECTION . . . . . . . . . . . . . . . . . . . . . 29
51. BILL OF LADING SECTIONS . . . . . . . . . . . . . . . 30
52. TERMINATION . . . . . . . . . . . . . . . . . . . . . 30
53. OPTION TO SHORTEN CHARTER PERIOD. . . . . . . . . . . 30
54. INSURANCE . . . . . . . . . . . . . . . . . . . . . . 31
55. INTERIM VOYAGES BY OWNER. . . . . . . . . . . . . . . 31
56. STEVEDORE DAMAGE. . . . . . . . . . . . . . . . . . . 32
57. LIGHTERING. . . . . . . . . . . . . . . . . . . . . . 32
58. MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . 33
59. NOTICES . . . . . . . . . . . . . . . . . . . . . . . 33
Appendix 1 -- Vessel Description and Performance
Appendix 2A -- Speed Warranty Calculations
Appendix 2B -- Fuel Warranty Calculations
Appendix 3 -- Unloader Test Procedures and Warranty Calculations
Appendix 4 -- Charterer's Purchase of Owner's Rights in the
Vessel
TIME CHARTER
This agreement is entered into this _____ day of ________,
1994 between International Shipholding Corporation, on its own
behalf and on behalf of its Guaranteed Nominee, to be named, as
Owner (hereinafter called "Owner") of the S/S ENERGY INDEPENDENCE
(hereinafter called "Vessel") and New England Power Company
(hereinafter called "Charterer").
WHEREAS, Charterer has agreed to purchase the Vessel from
Intercoastal Bulk Carriers, Inc. ("IBC") pursuant to Charterer's
options contained in a Time Charter dated 27 December 1989, and
Owner and Charterer have entered into a simultaneous Memorandum
of Agreement ("MOA") wherein Charterer agrees to sell to and
Owner agrees to acquire the Vessel from Charterer; and
WHEREAS, Owner and Charterer desire that the Vessel continue
to be chartered by Charterer for coal deliveries to its two
Massachusetts power plants;
NOW THEREFORE, Owner and Charterer hereby mutually agree
that the Owner will let and the Charterer will hire the use and
services of the Vessel for the carriage of coal and such other
lawful merchandise as may be suitable for a Vessel of its
description, for the period and on the terms and conditions set
forth below. Hereinafter, this document, including any
extensions, shall be referred to as the "Charter".
1. PERIOD
A. Owner agrees to let and Charterer agrees to hire the
Vessel for a period of days specified herein in each of 15
successive years (a "Charter Year"), commencing from the time and
date of delivery of the Vessel. Owner and Charterer acknowledge
that pending fulfillment of the MOA and delivery of the Vessel
hereunder, this Charter is an executory contract which shall
become null and void if the MOA is not fulfilled or the Vessel is
not delivered under this Charter.
B. The number of days of hire for each Charter Year shall
be as follows:
For Charter Years One and Two: 300 total days each year;
For Charter Years Three through and including Eight: 240
total days each year;
For Charter Years Nine through and including Fifteen: 210
total days each year.
C. Charterer shall have the option to increase, but may
not under any circumstances decrease without the concurrence of
Owner, the number of total days in any Charter Year specified
above, and shall exercise such option in accordance with the
provisions set forth in Clause 16.
2. DELIVERY/REDELIVERY EVENTS
At the commencement of this Charter, the Vessel will be
delivered to the Charterer upon Owner giving Notice to Charterer
that the Vessel has completed her contemplated dry docking and is
in all respects ready to perform her first voyage hereunder.
Upon termination of the Charter including extensions, if
any, the Vessel will be redelivered to the Owner at any port on
the United States East Coast at Charterer's option, free of
cargo. Charterer is to give the Owner 30 days prior notice of
the place of redelivery.
It is recognized by the parties that there will be
re-occurring delivery and redelivery events during the period of
this Charter. All such events other than delivery and redelivery
at the commencement and termination, respectively, of this
Charter, shall be guided by Clause 46 herein.
3. CLASSIFICATION OF VESSEL
A. The Owner warrants that the Vessel at the time of its
delivery to the Charterer and during the period of this Charter,
is properly documented under the laws of the United States so as
to qualify the Vessel for the United States coastwise trade. It
is the essence of this Charter that the Vessel, during the term
of service under this Charter, will remain qualified to engage in
United States coastwise trade. The Vessel will be qualified to
engage in international trade as well. The Owner agrees to pay
any annual fees and expenses in maintaining its obligations under
this paragraph.
If the Vessel, by reason of any action of the Owner or its
agent, contractor or employee during the term of the Charter,
were not to qualify for United States coastwise trade, the
Charterer shall have the right, but not the obligation, to
terminate this Charter upon written notice to the Owner (except
with respect to obligations and liabilities hereunder, actual or
contingent, which have arisen on or prior to such date of
termination), without being required to purchase the Vessel.
B. The Owner warrants that, as of the date hereof and
during the entire term of the Charter, it and any financial
institution having a direct or indirect interest in the Vessel
will be citizen(s) of the United States as defined in Section 2,
Shipping Act, 1916 as amended (46 U.S.C. App. 802). If the
Owner, or such other parties having a direct or indirect interest
in the Vessel, for any reason beyond their control during the
term of the Charter, were not to qualify as a citizen of the
United States as defined in this paragraph but the Vessel were
still qualified for United States coastwise trade, Charterer
shall have the right, but not the obligation, to terminate the
Charter (except with respect to obligations and liabilities
hereunder, actual or contingent, which have arisen on or prior to
such date of termination) and to purchase the Vessel, all in
accordance with Clause 52 and Appendix 4, except that the
Charterer need not give 180-days' notice, and the sale is to be
consummated as quickly as reasonably possible. If such
disqualification as a U.S. citizen were due to any reason within
the control of Owner or such other parties having a direct or
indirect interest in the Vessel, then Charterer has the option to
terminate the Charter without being required to purchase the
Vessel. Owner will be allowed a period of up to 10 days to cure
the disqualification before Charterer can exercise the
aforementioned option.
C. The Vessel shall be classed A1, BULK CARRIER, AMS, ACC,
for ocean service, American Bureau of Shipping. On delivery the
Vessel shall have in effect all certificates of inspection and
other approvals and permits required for lawful operation. Owner
shall maintain the Vessel in class through the period of the
Charter.
4. BUNKER COAL AND FUEL OIL
A. Owner warrants that the Vessel is capable of burning,
and will be able during the term of the Charter, to burn either
coal or fuel oil, as described below, in the main boilers;
(i) Bunker Coal:
Bunker Supply
Contract Min/Max Reject
Specifications Limits
-------------- -------
Ash (As Received (A/R) Basis) 7.0% Max 8.0% Max
Moisture (A/R Basis) 7.0% Max 8.0% Max
Sulfur (A/R Basis) 1.2% Max 1.5% Max
Volatile (Dry Basis) 28.0% Min 26.0% Min
BTU/lb (A/R Basis) 13,000 Min 12,850 Min
Ash Fusion Temperature (H=W) 2,600 Min 2,450 Min
Size 1-1/4" x 0 1-1/2" x 0
Size (% less than 1/4") 10.0% 15.0%
(ii) Fuel Oil:
Bunker Supply
Contract Min/Max
Specifications
---------------
Density at 15 Deg. gms/ml 0.991 - 0.995
Viscosity Kinematic at 50 o C 380 - 500
CCR Max 22
Flash Point PMCC (o F) Min 140 o
Water Content (Vol) Max 1.0%
Ash Content (Vol) Max 0.2%
Sulphur Content (Wt) Max 3.5%
Pour Point (o C) Max 30 o
Vanadium Content (PPM) Max 600
Aluminum Content (PPM) Max 30
BTU/bbl 6.05 mmbtus
B. By mutual agreement, the Owner may purchase and supply
fuel oil to the Vessel. Subject to the qualifications described
below, the Charterer agrees to reimburse the Owner for the cost
of that fuel oil and the reasonable expenses incurred in
transporting and delivering the fuel oil to the Vessel. Any fuel
oil which is to be purchased by the Owner (and for which the
Charterer has agreed to reimburse the Owner):
(i) will be at prices no higher than the prevailing
market prices at the ports in which it is furnished;
(ii) will be of a quality that is no higher than that
specified in paragraph (A) above; and
(iii) will not in any event result in a delivered cost
to Charterer which is more than the cost of bunker coal.
The cost of bunker coal ("Coal Cost") shall be determined
annually as the average cost based on records from the
preceding twelve months of (a) actual costs of coal
deliveries to the Vessel and (b) for each case where the
Vessel is bunkered with fuel oil instead of coal, the best
price quoted for contemporaneous and/or comparable
deliveries of coal to the Vessel. Estimated consumption of
coal will be based on Clause 4 A (i) above and Clause 5 A
below. Allowance for fuel oil consumed at discharge, will
be deducted from total fuel oil used for purposes of
calculating comparative cost of fuel used vis-a-vis "Coal
Cost".
The above notwithstanding, if the Owner is able to purchase
bunker fuel at a lower contract price than the prevailing market
price at the port of bunkering, the price charged to Charterer
shall be at the lower contract price.
(B) Charterer will purchase and will supply coal that is to
be burned as fuel ("bunker coal") for the Vessel at no cost to
Owner. In addition, upon request of Owner, Charterer will
arrange for the sampling and analysis of the bunker coal and the
delivery of those analyses to Owner or its agent.
(C) Prior to loading the bunker coal on board the Vessel,
Owner has the right to review analyses of "cartop" or otherwise
representative samples of the bunker coal to determine whether
the bunker coal meets the reject specifications set forth in
paragraph (A)(i) above. If the "cartop" or otherwise
representative samples were not to meet those reject
specifications, Owner may reject the bunker coal. In the event
of such a rejection:
(i) Charterer may elect to supply replacement bunker
coal, or in the event Charterer fails to supply bunker coal
in a timely manner and elects to have the Vessel wait for
bunker coal, the Vessel will remain on-hire while bunker
coal that meets the specifications is supplied by Charterer;
or
(ii) Charterer may decline to supply replacement coal
in which event the Vessel may burn oil to the extent it
lacks sufficient coal bunkers and not be penalized
therefore. If, however Owner does not reject the bunker
coal, Owner will be responsible for the bunker coal as if it
purchased the bunker coal for its own account and supplied
the bunker coal to the Vessel.
(D) At the conclusion of each month, Owner will provide a
statement to the Charterer which sets forth:
(i) the amounts expended by Owner for fuel oil for the
Vessel;
(ii) third-party expenses reasonably incurred in
supplying that fuel oil to the Vessel; and
(iii) the adjustment, if any, to reduce the amount
chargeable to Charterer to applicable Coal Cost.
Copies of invoices supporting those amounts and expenses
will be annexed to the statement. Charterer will pay the amount
of each statement within 30 days of its receipt.
5. DESCRIPTION OF VESSEL
EXCEPT AS SPECIFICALLY PROVIDED IN THIS CHARTER, IT IS
AGREED THAT AS OF THE DATE HEREOF, OWNER MAKES NO WARRANTY OR
REPRESENTATION, EITHER EXPRESS OR IMPLIED, AS TO TITLE TO, AS TO
THE DESIGN, CONDITION, MERCHANTABILITY OR SEAWORTHINESS OF, AS TO
THE QUALITY OF THE MATERIAL OR WORKMANSHIP IN, OR AS TO THE
CONSUMABLE STORES ABOARD, THE VESSEL, OR AS TO THE FITNESS OF THE
VESSEL FOR ANY PARTICULAR PURPOSE OR AS TO THE ELIGIBILITY OF THE
VESSEL FOR ANY TRADE OR ANY OTHER WARRANTY OR REPRESENTATION
WHATSOEVER.
A. Owner agrees that at the date of delivery under this
Charter, the Vessel will be of the description and performance
set out in Appendix 1, and will maintain the Vessel during the
period of service under this Charter. Should the Vessel during
the period of service under this Charter fail to comply in any
respect with the said description and performance, Owner shall
indemnify Charterer for such failure. Owner warrants that the
Vessel is capable of maintaining an average speed between sea
buoys of not less than 14.47 knots in Moderate Weather (defined
as periods when wind speed is up to and including Beaufort Scale
Number 5) calculated by averaging voyage legs in laden and
unladen condition with a maximum average consumption for all
purposes as follows:
(1) at sea: 119 mmbtus per hour
(2) at load port: 38 mmbtus per hour
(3) at disport 42 mmbtus per hour
B. On each anniversary date of initial delivery of the
Vessel during the period of service under this Charter (and upon
the termination of the Charter), the average speed and bunker
consumption under this Charter for each Charter Year shall be
calculated. Subject to the provisions of the speed warranty
calculation in Appendix 2A, the speed calculations will be based
on the distance made and time taken by the Vessel to complete all
non-slow steaming sea passages in Moderate Weather from sea buoy
to sea buoy but excluding time while the Vessel is off-hire. The
fuel consumption will be based:
(i) at sea, from the time the Vessel departs from its
load port sea buoy until the time that it arrives at its
discharge port sea buoy, and from the time that it departs
from its discharge port sea buoy until it arrives at its
load port sea buoy;
(ii) at the load port, from the time the Vessel arrives
at its loading berth (finished with engines) until the time
that it departs from its loading berth (standby engines);
and
(iii) at the discharge port, from the time the Vessel
arrives at its discharge berth (finished with engines) until
the time that it departs from its discharge berth (standby
engines).
C. If any of the calculations made under paragraph (B) of
this Clause show that, during any Charter Year:
(a) the average speed of the Vessel on non-slow
steaming sea passages in Moderate Weather has fallen short
of the average speed in service set out in paragraph (A) of
this Clause, and/or
(b) the average daily bunker consumption in mmbtus on
non-slow steaming sea passages in Moderate Weather has
exceeded the maximum consumption per day set out in
paragraph (A) of this Clause, and/or
(c) the average daily in-port bunker consumption has
exceeded the maximum consumption per day set out in
paragraph (A) of this Clause, then Charterer shall be
compensated by Owner by no later than the time for payment
of the first payment of hire due after completion of the
claim procedure set out below. The time lost due to Owner's
failure to meet the speed warranty will be valued at the
Vessel's daily hire rate as of the time the warranty was not
met. The fuel consumed due to the Owner's failure to meet
the fuel warranty will be valued at their Cost to the
Charterer. "Cost to Charterer" shall mean the weighted
average of the cost of fuel oil or bunker coal, as the case
may be, plus the reasonable expenses incurred in supplying
the fuel oil or bunker coal to the Vessel, during the course
of the year in question. Although the calculation to
determine whether the speed and certain fuel oil and bunker
coal consumption warranties have been met is to be based on
the sea passage portions of the non-slow steaming voyages in
Moderate Weather, the calculation to determine the amount to
be deducted under this paragraph (C) and paragraph (D) below
shall be based on the sea passages from sea buoy to sea buoy
of all voyages completed during the period in question. Any
amounts payable by Owner to Charterer shall be calculated in
accordance with Appendix 2.
No later than 30 days after the end of each Charter Year,
Owner will present to Charterer all information necessary to
determine whether a breach of warranty has occurred for the prior
Charter Year. Within 90 days of receiving such information from
Owners, if the Charterer were to have a claim for breach of the
speed or fuel warranties above, it will submit its claim, with
supports, to the Owner. If the Owner were to dispute Charterer's
claim, the Owner will present the reasons for its disagreement to
the Charterer within 60 days of the receipt of Charterer's claim,
failing which the Owner will be deemed to have accepted
Charterer's claim and will be barred thereafter from contesting
Charterer's claim.
D. Payments due under this Clause for the period between
the last complete Charter Year and the termination of this
Charter or any extension thereof shall in the first instance be
settled in accordance with Charterer's estimate made two months
before the end of the Charter period as so specified. Any
necessary adjustment after the end of the Charter shall be made
by payment by Owner to Charterer or by Charterer to Owner as the
case may require.
E. Owner warrants that, during the period of the Vessel's
service, the Vessel will be capable of discharging its entire
cargo of coal at the average rate of no less than 3,100 short
tons per hour.
(1) Charterer has the right twice during the calendar
year (the times of which are to be selected by Charterer in
its sole discretion) to cause a full load discharge test to
be made to determine whether the Vessel is meeting its
discharge warranty. Charterer shall give Owner seven
calendar days' notice of such test. The test shall take
place at Charterer's Brayton Point or Salem Harbor
generating stations, or at any other mutually agreeable
location. Charterer may withdraw its request at any time up
to 24 hours prior to the commencement of the test. Tonnage
discharged during the test shall be based on the bill of
lading, adjusted by coal retained on board. The test shall
be conducted in accordance with Appendix 3.
(2) If the results of such a test indicate that the
Vessel cannot meet its discharge capability warranty, Owner
agrees, at its sole risk and expense, to take such steps as
are necessary to cause the Vessel to meet its discharge
capability warranty by the time the Vessel next discharges a
cargo. Compliance with this paragraph E(2) will be
determined by a test the same as that described in paragraph
E(1) (such test or tests to be in addition to the two tests
allowed to Charterer pursuant to paragraph E(1) above).
(3) Charterer's sole remedy for Owner's breach of its
discharge rate warranty is damages if Owner fails to comply
with its obligation set forth in subparagraph E(2) above.
Damages will be based on time lost at the daily rate of
hire, and shall be calculated in accordance with Appendix 3.
F. Notwithstanding anything herein contained to the
contrary, if the Vessel's characteristics and/or performance are
modified or affected by reason of compliance with the laws,
regulations or requirements of any governmental or state agency,
as provided in Clause 29 herein, the Vessel's description and
performance or capability warranties shall be adjusted
accordingly 36 months after such modifications and/or additions
have been made to the Vessel in compliance with such
requirements.
6. CONDITION OF VESSEL
Owner shall throughout the period of service of this
Charter, exercise due diligence (i) to make the Vessel tight,
staunch, strong, seaworthy and in good order and condition, and
in every way fit for the service for which it is intended,
including but not limited to the carriage and self-unloading of
coal, with its machinery, boilers, liners and equipment in good
working order, and (ii) to cause the Vessel to have a full and
efficient complement of Master, Officers and crew. Owner agrees
throughout the period of the Charter to use due diligence to
cause the Vessel and its machinery, boilers and appurtenances to
be maintained in a condition to permit the Vessel to prosecute
all voyages at speed specified in Clause 5 and to meet its other
warranties under the Charter. Owner agrees to furnish to
Charterer by January 1 and July 1 of each year a written report
of any operational or equipment problems experienced by the
Vessel, or any problems which Owner expects to experience with
the equipment of the Vessel, during the coming semi-annual
period. Owner shall supply to Charterer all American Bureau of
Shipping and U.S. Coast Guard reports concerning the Vessel and
afford Charterer access to all American Bureau of Shipping and
U.S. Coast Guard files concerning the Vessel. This provision
constitutes Owner's irrevocable permission and instruction to ABS
and the U.S. Coast Guard to comply with Charterer's requests
pursuant to this Clause.
7. SUEZ/PANAMA CANALS
Owner undertakes that throughout the period of service under
this Charter it will at its expense comply with the regulations
in force from time to time so as to enable the Vessel to pass
through the Suez and Panama Canals by day and night without
delay.
8. CARGOES
Owner and Charterer have the right to ship coal, and any
other cargoes which are not injurious to the Vessel and its
unloading equipment, and as may be suitable for a Vessel of its
description including the unloading equipment. Carriage of any
cargo is subject to meeting all Trim and Stability restrictions
and requirements, and the approval of the National Cargo Bureau,
American Bureau of Shipping and United States Coast Guard. In
particular and without limiting the generality of the foregoing,
it is the intention of the Charterer to trade the Vessel with
coal. If, however, the Charterer were to change from coal to
another cargo or thereafter from another cargo to coal, any
expenses incurred to prepare the Vessel to carry another cargo or
thereafter to carry coal, including the expenses incurred for
cleaning the Vessel's holds, but excluding any wages or overtime
of the Master, Officers or crew (except as provided in Clause 32
or as otherwise agreed by Charterer and Owner), shall be for the
Charterer's account and the Vessel shall not be off-hire provided
that the Vessel has not otherwise incurred an event of off-hire
as described in Clause 46. Upon Charterer's request, Owner will
promptly provide Charterer with its best estimate of such costs
for any such cargo.
9. TRADING LIMITS
It is intended that the Vessel shall be used to trade
coastwise on the East Coast of the United States and to Venezuela
and Colombia. Under this Charter, the Vessel may be employed in
trading in any part of the world between safe ports in such
lawful trades as Charterer may direct, subject to American
Institute Trade Warranties Limits. Charterer shall be allowed to
breach institute warranties only in the event that risks
resulting from such breach are insurable, and upon payment by
Charterer of any additional insurance premiums and assumption by
Charterer of any increased deductibles, if required by
underwriters.
Charterer shall exercise due diligence to ensure that the
Vessel is only employed between and at safe ports, docks, places,
berths and anchorages where it can always lie safely afloat.
Notwithstanding anything contained in this or any other Clause of
this Charter, Charterer shall not be deemed to warrant the safety
of any port, place, berth, dock or anchorage and shall be under
no liability in respect thereof, except for loss or damage caused
by its failure to exercise due diligence as aforesaid. Subject
as above, the Vessel shall be loaded and discharged in any dock,
or at any wharf or place or anchorage, or alongside lighters or
other vessels as Charterer may direct where the Vessel can always
safely lie afloat.
10. RATE OF HIRE
A. The amount Charterer shall pay as hire to Owner monthly
in advance for use and services of the Vessel during the period
of this Charter set forth in Clause 1(B) shall be $46,015 per day
on-hire or pro rata, commencing with the date and time of the
commencement of the Charter and continuing (always assuming the
Vessel to be on-hire at the time) until the date and hour of the
termination or end (for any reason) of the Charter. Any hire
paid in advance but not earned shall be returned to Charterer
promptly upon written request. Charterer has the option
declarable within twelve (12) months after the commencement of
the Charter to pay charter hire for days on-hire pursuant to
Clause 1(B) during each of fifteen (15) consecutive years as
follows:
Years 1 thru 5* $50,000 per diem
Years 6 thru 8 $45,500 per diem
Years 9 thru 15 $41,000 per diem
(* or so much of Year 1 as shall remain after exercise of the
option), provided that should the Charter terminate or end (for
any reason), Owner will return any additional hire paid by reason
of this option over and above that which would otherwise but for
such acceleration have been paid, valued on the date of such
termination.
The above rates of charter hire shall be adjusted for
Amortization of Expenses, as defined in Clause 11 of the MOA,
such expenses to be calculated at or promptly after commencement
of this Charter.
B. The amount Charterer shall pay as hire to Owner monthly
in advance for use and services of the Vessel during the period
of this Charter set forth in Clause 1(C) shall be $29,983 per day
on-hire or pro rata.
C. Any hire paid in advance but not earned shall be
returned to Charterer promptly upon written request.
D. The total charter hire described above includes an
operating cost component that shall be subject to an annual
adjustment as of each anniversary of the commencement of the
Charter and continuing through the term of the Charter in
accordance with the following:
$31,788 times the quantity A divided by B where:
"A" is comprised 50% of the Consumer Price Index for
Urban Wage Earners and Clerical Workers, unadjusted for
seasonal variations, all items, U.S. city average, as
published in the Bureau of Labor Statistics' CPI Detailed
Report (the "CPI Index") plus 50% of the Producer Price
Index for Intermediate Goods, unadjusted for seasonal
variations, as published by U.S. Department of Labor Bureau
of Labor Statistics in its monthly Producer Price Indexes,
(the "PPI Index"), in each case referring to the CPI/PPI
Index for the last preceding month for which such index is
published before the annual adjustment date; and
"B" is comprised 50% of CPI Index plus 50% of the PPI
Index, in each case referring to the CPI/PPI Index for the
last preceding month for which such index is published
before commencement of the Charter.
If publication of the CPI and/or PPI Index described above
were to be discontinued, the parties will agree to a similar
index to replace the discontinued index. If the base period of
the CPI/PPI Index is changed, the parties will make appropriate
adjustments to the above calculation. If the parties were not to
agree, the disagreement will be submitted to arbitration pursuant
to Clause 41 and the arbitrators will select the replacement
index or indices or make the appropriate adjustments, as the case
may be.
It is agreed that while the Vessel is on-hire Charterer
shall pay the cost of the following:
1) expenses and cost of extra victualling incurred by
the Master on Charterer's account, and
2) cost of all telephone calls, wireless telegraph
messages and telegrams sent for Charterer's
account.
11. PAYMENT OF HIRE
Payment of charter hire shall be made monthly in advance at
the rates required under Clause 10. For each Charter Year, the
monthly payment shall be one-twelfth the amount of hire to be
paid based on the number of days of hire specified in Clause
1(B), plus any additional hire for optional days pursuant to
Clauses 1(C) and 16, subject to annual adjustment for the number
of days the Vessel was actually on-hire in such Charter Year.
Charterer shall pay hire by bank telegraphic/electronic transfer
to a bank as may, from time to time, be designated in writing by
the Owner, monthly in advance in United States dollars.
Charterer acknowledges and agrees that, except as otherwise
expressly provided in this Charter, its obligations to pay
charter hire for the number of days per year each year in which
the Vessel is on-hire, and all other sums required to be paid by
Charterer under this Charter, all in accordance with the terms
and provisions of this Charter, are absolute and unconditional
and not subject to any abatement, reduction, setoff, defense,
counterclaim or recoupment for any reason whatsoever. Nothing
contained herein shall be construed to be a waiver, modification,
alteration or release of any claim which Charterer may have at
any time for damages or equitable relief against Owner.
12. LOSS OF VESSEL
If the Vessel should be missing or lost, or become a
constructive total loss, Owner shall promptly notify Charterer in
writing. Hire shall cease at noon on the day of the Vessel's
loss or on the actual date of the casualty giving rise to the
constructive total loss and, if missing, at noon on the date when
last heard from. Any hire paid in advance and not earned shall
be returned promptly to Charterer. If the Vessel is missing at
the time when hire becomes payable, payment for said hire shall
be suspended until safety is ascertained. If the missing
Vessel's safety is ascertained within 10 days of receipt of
notice, this Charter shall continue as if no such notice had been
given, and hire shall be adjusted accordingly. If the missing
Vessel's safety is not ascertained within 10 days of receipt of
notice, this Charter shall terminate effective at noon on the
date when last heard from, except with respect to obligations and
liabilities hereunder, actual or contingent, which have arisen on
or prior to such date of termination.
13. FINAL VOYAGE
Should the Vessel be on a voyage towards the port of
redelivery at the time a payment of hire is due, payment of hire
shall be made for such length of time as Owner and Charterer may
agree upon as being the estimated time necessary to complete the
voyage, less any disbursements made or expected to be made or
expenses incurred or expected to be incurred by Charterer for
Owner's account and less the cost of fuel estimated remaining at
the termination of the voyage, and when the Vessel is redelivered
any overpayment shall be refunded by Owner or under-payment paid
by Charterer. Should the Vessel be performing a voyage at the
expiry of the period of this Charter, Charterer may have the use
of the Vessel at the same rate and conditions, for such extended
time as may be necessary to complete loading and/or discharge of
the cargo as required by Charterer, and if necessary until the
Vessel's return to a port of redelivery as provided by this
Charter.
14. LIENS
Owner shall have a lien upon all cargoes, and all freights
and subfreights for any amounts due under this Charter, and
Charterer shall have a lien on the Vessel for all monies paid in
advance but not earned, and for the cost of bunker coal and oil,
and for all claims for damages arising from any breach of this
Charter by Owner.
15. SPACE AVAILABLE TO CHARTERER
The whole reach, burden and decks of the Vessel shall be at
Charterer's disposal, reserving only proper and sufficient space
for the Vessel's Master, Officers, crew, tackle, apparel,
furniture, provisions and stores, provided that the weight of
stores on board excluding spare parts shall not, unless
specifically agreed, exceed 150 tons at any one time during the
period of the Charter. The Vessel shall load and discharge cargo
as rapidly as possible by night as well as by day.
16. ANNUAL DAYS OF USE BY CHARTERER
Charterer shall have the option to increase, but not to
decrease, the number of total days of any one year of the period
of this Charter specified in Clause 1(B). Such option shall be
exercised as follows:
(i) 30 days prior to the commencement of each calendar
quarter of each year, Charterer shall declare the total
number of days in that quarter and in the next successive
three calendar quarters, in which it intends to use the
Vessel. Such number of days shall be agreed by Owner within
ten days of making such declaration, following which such
days so declared may be changed for Charterer's operational
purposes only but not otherwise except with the consent of
the Owner in its sole discretion, such consent not to be
unreasonably withheld.
(ii) Under no condition may Charterer exercise an
option to reduce the number of days set forth in Clause 1(B)
without the written consent of the Owner in its sole
discretion, such consent not to be unreasonably withheld.
Charterer may assist Owner to find alternative employment
for days in which Charterer does not hire the Vessel.
Any declaration of number of days made by Charterer at any
time shall include an anticipated redelivery date and place to
Owner, and an estimated date and time for the next delivery
event. Such notice shall be updated to Owner 30/15/5 and one
days prior to redelivery.
Similarly, Owner shall provide notice to Charterer 30/15/5
and one days prior to each delivery event, such notice to specify
date and place of redelivery.
17. OWNER TO PROVIDE
Owner shall exercise due diligence to man, victual,
navigate, operate, obtain fuel oil, water, supply, maintain, and
arrange for tugs and pilotage for the Vessel, and properly and
carefully carry, keep and care for the cargo, all in accordance
with good operating practice. Owner shall provide and pay for
all provisions, deck and engine room stores, and galley and cabin
stores; maintenance and repair; insurance on the Vessel; wages
and overtime of the Master, Officers, and crew; consular and
agency fees pertaining to the Vessel, Master, Officers and crew;
all deratization exemption certificates; all fresh water used by
the Vessel. Fumigation expenses required because of cargoes
loaded and ports visited at Charterer's direction will be for
Charterer's account; and for any other reason, will be for
Owner's account.
18. CHARTERER TO PROVIDE
Except during periods when the Vessel is off-hire, Charterer
shall pay for fuel as provided in Clause 4, all port charges,
light dues, and Panama and other canal dues, pilotage, consular
and agency fees (except those agency fees which pertain to: (i)
voyages on the East Coast of the United States or (ii) the
Vessel, Master, Officers and Crew), tugs necessary for assisting
the Vessel into, within and/or out of port for the purpose of
carrying out this Charter, agencies pertaining to the cargo,
commissions, and expenses of loading and unloading cargoes. In
making any expenditures to Charterer's account, Owner shall use
its best efforts to procure all items and services at the best
terms available in the local market.
19. BUNKER COAL AND FUEL OIL AT DELIVERY AND REDELIVERY EVENTS
Except for the delivery at the commencement of this Charter,
because fuel on board is the property of Charterer, Charterer
will accept and pay for all fuel oil and bunker coal on board at
the time of each delivery event, and Owner will accept and pay
for all fuel oil and bunker coal remaining on board at each
redelivery event. At all times, the then most recent invoiced
prices for such items shall serve as the basis for payment.
Any and all surveys for bunkers at each delivery and
redelivery event shall be conducted by an independent third
party, the expenses for which shall be borne equally by the Owner
and the Charterer. The Vessel shall remain on-hire in the event
such survey is conducted when the Vessel is redelivering to
Owner, and shall remain off-hire in the event such survey is
conducted when the Vessel is delivering to Charterer for further
trading under this Charter.
20. DUTIES OF MASTER
The Master shall prosecute voyages with the utmost dispatch
and shall render all reasonable assistance with the Vessel's
Officers and crew and equipment. The cargo shall be loaded,
stowed, trimmed, and discharged under the supervision of the
Master, without being an agent, servant or employee of Charterer.
The Master, in good faith and to the fullest extent reasonably
possible, shall cooperate with Charterer, Charterer's agents and
the personnel at the loading and discharging facilities so as to
effect prompt and complete loading and discharging.
21. INSTRUCTIONS AND LOGS/CHARTER ADMINISTRATION
A. Charterer shall, from time to time, furnish the Master
with all requisite instructions and sailing directions. Both the
Master and the engineers shall keep full and correct logs of the
voyages, which are to be open to, and may be copied by, Charterer
and its Agents, and abstracts of which are to be sent to
Charterer at the same time they are sent to Owner on a voyage by
voyage basis. Charterer and Owner agree that these log abstracts
shall constitute the basis of calculations for warranty or other
Charter purposes, unless Owner or Charterer, by written notice to
the other, challenges any statements contained therein with
proper explanation. Twice in each Charter Year, at regular
intervals, Owner will send to Charterer copies of any of Owner's
reports (both internal reports and those prepared by outside
professionals) relating or referring to the maintenance and
condition of the Vessel. Notwithstanding the foregoing, Owner
shall remain responsible for providing the Master with the
required charts and other data necessary for the prompt and safe
prosecution of the voyage and compliance with applicable Coast
Guard regulations.
B. Either Owner or Charterer shall be entitled to call for
a meeting of pertinent personnel, from time to time, to discuss
any matter whatsoever relating to the parties performance or the
efficient administration of this Charter. Any request for such a
meeting shall specify: a proposed date, time, and location for
the meeting; a statement as to the perceived urgency of the
requested meeting; a proposed agenda; a prospective list of
attenders from the party calling for such meeting; a suggested
list of third party attenders (if applicable); any specific
proposals that the initiating party may seek to discuss at the
meeting. The party receiving the request shall use all best
efforts to accommodate the request for a meeting, in a timely
manner, and with commitment of personnel and resources that
yields a productive meeting on the proposed agenda. The
receiving party shall be entitled to submit agenda items for the
proposed meeting, consistent with the guidelines mentioned
herein.
22. CONDUCT OF VESSEL'S PERSONNEL
If Charterer shall complain of the conduct of the Master or
any of the Officers, Owner and Charterer jointly shall
immediately investigate the complaint. This right to complain
shall not in any way render the Master or Officers to be the
agents, servants or employees of the Charterer. If the complaint
proves to be well founded, Owner shall, without delay, make a
change in the appointments; provided, however, that the Owner
shall have the right to abide by grievance procedures in union
bargaining contracts to the extent applicable. When requested by
Charterer, Owner shall furnish to Charterer copies of the union
contracts referred to, including all amendments thereto.
23. BILLS OF LADING
Without being an agent, servant or employee of Charterer,
the Master (although appointed by Owner) shall, when Vessel is
on-hire to Charterer under this Charter, follow all orders and
direction of Charterer as regards employment of the Vessel,
agency or other arrangements. Bills of Lading are to be signed
at any rate of freight Charterer or its Agents may direct,
without prejudice to this Charter, the Master attending as
necessary at the offices of Charterer or its Agents to do so.
Charterer hereby indemnifies Owner against all consequences or
liabilities that may arise from the Master, Charterer or its
Agents signing Bills of Lading or other documents, or from the
Master otherwise complying with Charterer or its Agents' orders,
as well as from any irregularities in papers supplied by
Charterer or its Agents. The said indemnity shall not extend to
any consequences or liabilities or apply to any loss or damage
arising from orders to proceed to, enter, remain in or at, depart
from or shift berth in or at any port, place, berth, dock,
anchorage or submarine line, other than consequences or
liabilities or loss or damage resulting from or caused by failure
to exercise due diligence as required by Clause 9 hereof.
24. SCHEDULED OVERHAUL
Owner intends to schedule overhaul periods of the Vessel
between twenty-four (24) months to sixty (60) months. Owner
shall provide Charterer a minimum of 3 months prior notice of any
anticipated overhaul period. This Clause shall not be construed
so as to prevent Owner from taking the Vessel out of service when
necessary to make essential repairs. Overhaul periods will take
place during commercial off-hire periods as defined in Clause 46.
Once the overhaul period has commenced, Owner shall provide
Charterer with updates of the Vessel's anticipated return to
service at 10/5/3/2 and one days prior to its anticipated return
to service. Any delay or waiting time in the scheduling of
Charterer's operations due to Owner's failure to provide such
notices and with reasonable accuracy, shall be for Owner's
account and calculated at the rate of hire prevailing at the time
of such delay to or wait by the Vessel. The Vessel shall be
off-hire under Clause 46 from the time the Vessel deviates to the
dry docking or overhaul port, until the time the Vessel is in a
position equivalent to the position it would have been in had
deviation for the overhaul period not occurred.
Incidental towage, pilotage, fuel, water and all other
expenses connected with the overhaul shall be for Owner's
account.
25. NEGLIGENCE OF PILOTS, ETC.
Neither Charterer, nor any one of its associated or
affiliated companies, including but not limited to New England
Electric System and all subsidiaries thereof (each of which
companies shall hereinafter be referred to as a "Related Company"
or, collectively, as "Related Companies"), nor any of the
employees, servants, representatives and agents of any of the
foregoing, shall be responsible for any losses, damages, delays
or liabilities arising from any negligence, incompetence or
incapacity of any pilot, stevedore, longshoreman or the personnel
of any tug or tugs (whether or not owned by the Charterer or a
Related Company) or arising from the terms of the contract of
employment thereof and of any tug or tugs, launches or other
crafts (whether or not owned by the Charterer or a Related
Company), which terms Owner hereby agrees to accept and be bound
by, or arising from any unseaworthiness or any insufficiency of
any tug or tugs, launches or any other craft the service for
which are arranged or owned by Charterer or a Related Company.
Owner agrees to indemnify and hold Charterer harmless against any
and all such losses, damages, delays or liabilities but such
indemnity shall not exceed the amount to which Owner would have
been entitled to limit its liability if Owner had itself arranged
for such pilots, stevedores, longshoremen, tug personnel, tug or
tugs, launches or other craft. When any licensed pilot, captain
or other officer (whether or not said person is an employee,
servant or representative of Charterer or its agents or of any of
its Related Companies or of their agents) of a tug furnished to
or engaged in the service of supplying tug power or assistance to
the Vessel making use of or having available its own propelling
power goes on board the Vessel, or any other licensed pilot goes
on board the Vessel, it is understood and agreed that such person
or persons are to be considered independent contractors and
become the borrowed servant of the Owner and the Vessel for all
purposes and in every respect, and shall be subject to the
exclusive supervision and control of the Vessel and her
personnel. Neither Charterer nor its Related Companies nor those
providing the tug or tugs nor Owner, agents, or Charterer shall
be under any liability for errors of navigation, management of
the Vessel or other losses, damages, delays and liabilities
resulting therefrom. This shall include, but not be limited to
the giving of orders to any tug or tugs engaged in assisting
Vessel in respect to the handling of the Vessel and to the order
of the number and horsepower of tugs assisting or standing by the
Vessel. In respect to the foregoing, Owner hereby agrees to
indemnify and hold harmless Charterer (or any of its Related
Companies or its agents or the employees, servants or
representatives of the foregoing in the event that said licensed
pilot, captain or other officer is employed by such company) from
any and all losses, damages, delays and liabilities whatsoever
whether to third parties or otherwise, arising from the acts or
omissions of such person or persons.
26. TUGBOATS
Charterer shall have the option of using its own tugs or
those owned by a Related Company in the docking, undocking, or
assisting in other ways of the Vessel. In this event the terms
and conditions for such services prevailing in the port where
such services are rendered, and used by independent tugboat
owners, as well as pilotage provisions under Clause 25 above,
shall be applicable. Charterer and its Related Companies shall
be entitled to all the exemptions from and limitations of
liability applicable to said independent tugboat owners and their
published terms and conditions and to the aforementioned pilotage
provisions under Clause 25 above.
27. EQUIPMENT
Charterer, subject to Owner's approval which shall not be
unreasonably withheld, shall be at liberty to fit any additional
gear for loading, discharging, weighing or sampling cargo it may
require beyond what is on board at the commencement of the
Charter, and to make all the necessary connections, such work to
be done at its expense. Owner shall use its best efforts to
assist Charterer in the design, acquisition, installation,
certification, operation and maintenance of such equipment. Such
gear so fitted shall be considered Charterer's property, and
Charterer shall be at liberty to remove it at its expense and
time during or at the expiration of this Charter; the Vessel to
be left in its original condition to Owner's satisfaction less
normal wear and tear.
28. SALVAGE
All salvage monies earned by the Vessel shall be divided
equally between Owner and Charterer after deduction of Master's,
Officers' and Crews' share, legal expenses, hire of Vessel during
lost time, value of fuel consumed, repairs of damage, if any, and
any other extraordinary loss or expense sustained as a result of
the services, which shall always be a first charge on such
monies.
29. POLLUTION FINANCIAL RESPONSIBILITY
A. During the period of this Charter, Owner warrants that
Owner shall comply with all financial capability, responsibility,
security or like laws, regulations and/or other requirements of
whatsoever kind with respect to oil or other pollution damage
applicable to the Vessel entering, leaving, remaining at or
passing through any ports or places or waters in the performance
of this Charter and shall make all equipment modifications and
additions as necessary to so comply, at Charterer's risk and
expense. Any such modification or addition shall be deemed to
be, and shall be treated as, "equipment" under Clause 27 herein.
Immediately upon receipt of a notice from any governmental or
state agency which would (or could) require a modification of
existing equipment or an installation of additional equipment
under this paragraph, the Owner shall notify the Charterer and
keep Charterer fully informed. If there were to be more than one
strategy for compliance, the Owner shall choose the compliance
strategy which a prudent owner bearing all costs thereof would
choose based upon a comparison of the life-cycle costs of each
alternative. Owner shall provide Charterer with all data and
assumptions used in such comparisons. Owner at its sole risk and
expense shall make all arrangements by bond, insurance or
otherwise and obtain all such certificates or other documentary
evidence and take all such other action, as may be necessary, to
satisfy such laws, regulations and/or other requirements. Copies
of all documents shall be supplied to Charterer. Owner shall
indemnify Charterer against all consequences (including lost time
to the Vessel) resulting from any failure, inability or omission
of Owner and/or the Vessel to do the foregoing.
B. If any governmental or state agency shall require the
installation of additional equipment, including pollution control
devices, such equipment will be installed on the Vessel by Owner
at Charterer's risk and expense. Owner will use its best efforts
to properly maintain and operate such equipment effectively and
assumes responsibility for its effectiveness.
30. EXCEPTIONS
Neither the Vessel nor the Master or Owner shall be held
liable for any loss of or damage or delay to the cargo or for any
failure in performing hereunder arising or resulting from: any
act, neglect, default or barratry of the Masters, pilots,
mariners or other servants of Owner in the navigation or
management of the Vessel; fire, unless caused by the personal
design or neglect of Owner; collision, stranding or peril, danger
or accident of the sea or other navigable waters; saving or
attempting to save life or property; wastage in weight or bulk,
or any other loss or damage to the cargo arising from inherent
defect, quality, or vice of the cargo; any act or omission of
Charterer or the Owner, shipper or consignee of the cargo, their
agents or representatives; insufficiency of packing;
insufficiency or inadequacy of marks; explosion, bursting of
boilers, breakage of shafts, any latent defect in hull equipment
or machinery, or unseaworthiness of the Vessel, unless caused by
want of due diligence on the part of Owner to make the Vessel
seaworthy or to have it properly manned, equipped and supplied;
or from any other cause of whatsoever kind arising without the
actual fault or privity of Owner. And neither the Vessel, its
Master or Owner, nor Charterer, shall, unless this Charter
expressly provides otherwise, be responsible for any loss of or
damage or delay to or failure to discharge or deliver the cargo
or for any failure in performing hereunder arising or resulting
from: act of God, act of war, perils of the seas, act of public
enemies, pirates or assailing thieves, arrest or restraint or
restraint of princes, rulers or people, or seizure under legal
process provided bond is promptly furnished to release the Vessel
or cargo, laws or governments regulation, strike or lockout or
stoppage or restraint of labor from whatever cause whether
partial or general or riot or civil commotion or any other cause
of whatsoever kind arising without the actual fault or privity of
the party affected. The Vessel shall have liberty to sail with
or without pilots, to tow or to be towed, to go to the assistance
of vessels in distress, and to deviate for the purpose of saving
life or property or of landing any ill or injured person on
board. This Clause is not to be construed as in any way
affecting the provisions for cessation of hire as provided in
this Charter.
31. WAR CLAUSE
No contraband of war shall be shipped. Coal or other cargo
shall not be deemed contraband of war for the purpose of this
Clause unless shipped or intended to be shipped to or intended
for a country involved in war. The Vessel shall not be required
to enter any port that is in a state of blockage, or where
hostilities are in progress, or any war zone, or zone deemed a
danger zone in consequence of existence of war, or actual
hostilities, without the consent of Owner. If such consent be
given, then Charterer will pay the increased cost of insuring the
Vessel against war risks in an amount mutually agreed to by Owner
and Charterer. Said valuation shall be Owner's insured value for
hull and machinery plus increased value, but shall not include
any coverage for any other reasons such as loss of hire,
anticipated profits or insurance on charter hire, etc.
32. ADDITIONAL COST OF HOSTILITIES
In the event of the existence of war, or actual hostilities
and the continuance of this Charter, the Charterer shall assume
the proved additional cost of wages and insurance properly
incurred in connection with the Master, Officers and crew as a
consequence of such war or actual hostilities.
33. REQUISITION
If the Vessel should be requisitioned for title or for use
by any government or governmental authority during the period of
this Charter, an event of commercial off-hire shall be deemed to
have occurred, and all terms and conditions of commercial
off-hire in this Charter shall apply, in addition to the
following:
A. If the Vessel should be requisitioned for title by any
government or governmental authority during the period of this
Charter, Owner shall promptly notify Charterer in writing. Hire
shall cease at noon on the day of such requisition for title.
Any hire paid in advance and not earned shall be promptly
returned to Charterer.
B. If the Vessel should be requisitioned for use by any
government or governmental authority during the period of this
Charter, Owner shall promptly notify Charterer in writing.
Charterer shall have the right to complete the voyage then in
progress, and shall remain liable to pay Charter hire and all
other sums due and payable under this Charter until the then
current voyage is completed and the Vessel redelivers to Owner
for a commercial off-hire period.
C. Any provision of this Charter to the contrary
notwithstanding, the time the Vessel is on any such requisition
shall count as part of the period provided in Clause 1 of this
Charter and as commercial off-hire even if it reduces the number
of days on-hire in one or more Charter Years below the minimum
specified in Clause 1.
34. DEMISE
Nothing herein contained shall be construed as creating a
demise of the Vessel to Charterer. The Owner shall remain
responsible for the navigation of the Vessel, insurance, crew and
all other matters same as trading for its own account.
35. WAR RISKS
A. If any port of loading or of discharge named in this
Charter or to which the Vessel may properly be ordered pursuant
to the terms of the Bills of Lading be blockaded, or
B. if owing to any war, hostilities, warlike operations,
civil war, civil commotions, revolutions or the operation of
international law, the Master or Owner in his or its discretion
considers (1) entry to any such port of loading or of discharge,
or the loading or discharging of cargo at any such port dangerous
or prohibited or (2) it is dangerous or impossible for the Vessel
to reach any such port of loading or discharge then Charterer
shall have the right to order the cargo, or such part of it as
may be affected, to be loaded or discharged at any other safe
port of loading or of discharge within the range of loading or
discharging ports respectively established under the provisions
of this Charter (provided such other port is not blockaded or
that entry thereto or loading or discharge of cargo thereat is
not, in the Master's or Owner's discretion, dangerous or
prohibited). If in respect of a port of discharge no orders be
received from Charterer within 48 hours after it or its agents
have received from Owner a request for the nomination of a
substitute port, Owner shall then be at liberty to discharge the
cargo at any safe port which it or the Master may in its or his
discretion decide on (whether within the range of discharging
ports established under the provisions of this Charter Party or
not) and such discharge shall be deemed to be due fulfillment of
the contract or contracts of affreightment so far as cargo so
discharged is concerned. In the event of the cargo being loaded
or discharged at any such other port within the respective range
of loading or discharging ports established under the provisions
of this Charter, this Charter shall be read in respect of freight
and all other conditions whatsoever as if the voyage performed
were that originally designated. In the event, however, that the
Vessel discharges the cargo at a port outside the range of
discharging ports established under the provisions of this
Charter, freight shall be paid as for the voyage originally
designated and all extra expenses involved in reaching the actual
port of discharge and/or discharging the cargo thereat shall be
paid by the Charterer or cargo owner. In this latter event Owner
shall have a lien on the cargo for all such extra expenses.
C. The Vessel shall have liberty to comply with any
directions or recommendations as to departure, arrival, routes,
ports of call, stoppages, designations, zones, waters, delivery
or in any otherwise whatsoever given by the government of the
nation under whose flag the Vessel sails or any other government
or local authority including any de facto government or local
authority or by any person or body acting or purporting to act as
or with the authority of any such government or authority or by
any committee or person having under the terms of the war risks
insurance on the Vessel the right to give any such direction or
recommendation. If by reason of or in compliance with any such
direction or recommendation anything is done or is not done such
shall not be deemed a deviation. If by reason of or in
compliance with any such direction or recommendation the Vessel
does not proceed to the port or ports of discharge originally
designated or to which it may have been ordered pursuant to the
terms of the Bills of Lading, the Vessel may proceed to any safe
port of discharge which the Master or Owner in his or its
discretion may decide on and there discharge the cargo. Such
discharge shall be deemed to be due fulfillment of the contract
or contracts of affreightment and Owner shall be entitled to
freight as if discharge had been affected at the port or ports
originally designated or to which the Vessel may have been
ordered pursuant to the terms of the Bills of Lading. All extra
expenses involved in reaching and discharging the cargo at any
such port of discharge shall be paid by Charterer and/or cargo
owner and Owner shall have a lien on the cargo for freight and
all such expenses.
36. BOTH-TO-BLAME
If the Vessel comes into collision with another ship as a
result of the negligence of the other ship and any act, neglect
or default of the Master, mariner, pilot or the servants of the
Owner in the navigation or in the management of the Vessel, the
owners of the cargo carried hereunder shall indemnify the Owner
against all loss or liability to the other or non-carrying ship
or its owners insofar as such loss or liability represents loss,
or damage to, or any claim whatsoever of the owners of said
cargo, paid or payable by the other or recovered by the other or
non-carrying ship or her owners as part of their claim against
the carrying ship or Owner. The foregoing provisions shall also
apply where the owners, operators or those in charge of any ships
or objects other than, or in addition to, the colliding ships or
object are at fault in respect of a collision or contact.
37. NEW JASON CLAUSE
In the event of accident, danger, damage or disaster before
or after the commencement of any voyage, resulting from any cause
whatsoever, whether or not due to negligence for which, or the
consequences of which, the Owner is not responsible by statute,
contract or otherwise, the goods, shippers, consignees or owners
of the goods shall contribute with the Owner in general average
to the payment of any sacrifices, losses or expenses of a general
average nature that may be made or incurred and shall pay salvage
and special charges incurred in respect of the goods. If salving
ship is owned or operated by the Owner salvage shall be paid for
as fully as if the said salving ship or ships belonged to
strangers. Such deposits as the Owner or his agents may deem
sufficient to cover the estimated contribution of the goods and
any salvage and special charges thereon shall, if required, be
made by the goods, shippers, consignees or owners of the goods to
carrier before delivery. In lieu of said deposit, Charterer has
the option to give, and Owner will accept, written guarantee of
Charterer to cover any contribution of the goods and any salvage
and special charges thereon as may be required to be made by the
goods, shippers, consignees or owners of the goods.
38. CLAUSE PARAMOUNT
This Charter and Bills of Lading issued hereunder shall have
effect subject to the provisions of the Carriage of Goods by Sea
Act of the United States, approved April 16, 1936. The
applicable act, ordinance or legislation (hereinafter called the
"Act") shall be deemed to be incorporated in the Bills of Lading
issued hereunder. Nothing therein contained shall be deemed a
surrender by the Owner or carrier of any of their rights or
immunities or an increase of any of their responsibilities or
liabilities under the Act. If any term of this Charter or the
Bills of Lading issued hereunder should be repugnant to the Act
to any extent, such term shall be void to that extent but no
further.
39. LAWS
This Charter shall be governed by the general maritime law
of the United States (and to the extent maritime law is not
applicable, the laws of the State of New York) except in cases of
general average, which shall be adjusted, stated and settled
according to York/Antwerp Rules 1974 and, as to matters not
provided for by these rules, according to the laws and usages at
the port of New York. If a General Average statement is
required, it shall be prepared at such port or place in the
United States as directed by Owner, unless otherwise mutually
agreed by an Adjuster appointed by Owner and approved by
Charterer, who shall attend to the settlement and collection of
the General Average, subject to customary charges. General
Average Agreements and/or security shall be furnished by Owner
and/or Charterer, and/or Owner and/or consignee of cargo, if
requested. Any cash deposit being made as security to pay
General Average and/or salvage shall be remitted to the Average
Adjuster and shall be held by him at his risk in a special
account in a duly authorized and licensed bank at the place where
the General Average statement is prepared. Should the Vessel put
into a port of distress or be under average, it is to be
consigned to the Owner's agents, paying them the usual charges
and commissions.
40. BENEFIT OF LIMITATIONS
Any provision of this Charter to the contrary
notwithstanding, Owner shall have the benefit of all limitations
of, and exemptions from, liability accorded to the Owner or
chartered owner of vessels by any applicable statute of rule of
law for the time being in force.
41. ARBITRATION
Any and all differences and disputes of whatsoever nature
arising out of this Charter which cannot be resolved by the
parties shall be put to arbitration in the City of New York
pursuant to the laws relating to arbitration there in force,
before a board of three persons, consisting of one arbitrator to
be appointed by the Owner, one by Charterer and one by the two so
chosen. The decision of any two of the three on any point or
points shall be final. Either party hereto may call for such
arbitration by service upon any officer of the other, wherever he
may be found, of a written notice specifying the name and address
of the arbitrator chosen by the first moving party and a brief
description of the disputes or differences which such party
desires to put to arbitration. If the other party shall not, by
notice served upon an officer of the first moving party within
two weeks of the service of such first notice, appoint its
arbitrator to arbitrate the disputes or differences specified
then the first moving party shall have the right without further
notice to appoint a second arbitrator, who shall be a
disinterested person, with precisely the same force and effect as
if said second arbitrator had been appointed by the other party.
In the event that the two arbitrators fail to appoint a third
arbitrator within twenty days of the appointment of the second
arbitrator, the appointment of a third arbitrator shall be made
by the acting president of the Society of Maritime Arbitrators,
Inc. (New York) and the appointment of such arbitrator shall have
precisely the same force and effect as if such arbitrator had
been appointed by the two arbitrators. Until such time as the
arbitrators finally close the hearings, either party shall have
the right by written notice served on the arbitrators and on an
officer of the other party to specify further disputes or
differences under this Charter for hearing and determination.
Awards made in pursuance of this Clause may include costs,
including a reasonable allowance for attorney's fees, but may not
include punitive or multiple damages. Judgment may be entered
upon any award made hereunder in any court having jurisdiction in
the premises. Should either party desire it, arbitration
proceedings hereunder will be consolidated with any arbitration
under the MOA.
42. BROKER'S COMMISSIONS
Owner warrants that there are no brokerage commissions
payable with respect to this Charter and will indemnify, hold
harmless and defend Charterer against any claim for brokerage
commission.
43. INSPECTION AND SUPERCARGOES
Charterer or its agents or designees shall have the right at
any time, and from time to time, during the term of this Charter
to, at its own expense, (a) inspect, survey and/or audiogauge
and/or photograph or videotape the entire reach of the Vessel,
including its underwater parts, cargo and machinery spaces, to
the fullest possible extent, and (b) place a technical consultant
and/or supercargo on the Vessel.
44. SUBCHARTER
Charterer shall not subcharter the Vessel to any party
whatsoever unless written consent shall first be obtained from
Owner, which consent shall not be unreasonably withheld. In the
event of any subcharter, Charterer shall reimburse Owner for any
expenses incurred by Owner for the operation of the Vessel in
connection with any subcharter which exceed the expenses which
Owner would have otherwise not have incurred in the employment of
the Vessel in the U.S. East coast carriage of coal to Charterer's
Massachusetts generating stations; provided, however, that
Charterer shall not be required to reimburse Owner for any extra
wages or overtime of the Master, Officers or crew (except as
provided in Clause 32 or as otherwise agreed by Charterer and
Owner, or except where such excess expenses result from overtime
incurred at the specific request of Charterer which is in excess
of the overtime incurred in the Vessel's regular employment).
Upon Charterer's request Owner will promptly provide Charterer
with its best estimate of such costs for any proposed subcharter
specified by Charterer.
45. RESTRICTIONS ON USE OF VESSEL
Notwithstanding any other provisions of this Charter, the
Vessel shall not without the prior approval of the United States
Maritime Administration, trade to or from any country listed by
the United States Maritime Administration in its General Order
No. 59 (46 CFR 221.7), as the same may be amended from time to
time. Charterer agrees to take no action that would cause the
Vessel to cease to qualify as "Section 38 property" as defined in
Section 48 of the Internal Revenue Code.
46. OPERATIONAL AND COMMERCIAL OFF-HIRE
Under this Charter there shall be two categories of
off-hire: Operational and Commercial. They are defined as
follows:
A. Operational off-hire shall be deemed to have occurred
in the event of loss of time continuing for more than four hours
through:
(1) deficiency of personnel;
(2) deficiency of stores;
(3) breakdown (whether partial or otherwise) of
propulsion and/or cargo unloading machinery or boilers;
(4) accident or damage to the Vessel including
collision or stranding;
(5) a strike of Officers or crew of the Vessel (but not
a strike of the longshoremen, miners or other facilities
notwithin the control of the Owner); or
(6) any other cause preventing the efficient working of
the Vessel.
B. Commercial off-hire shall be deemed to have occurred in
the event the Charterer provides adequate written notice to
Owner, and which has been accepted and agreed by Owner in
accordance with Clause 16.
C. In the event of an operational off-hire period that
appears to Charterer will extend longer than 35 consecutive days,
Owner shall be obligated to provide suitable coal transport
capacity in the form of other colliers or barges, at a cost per
short ton equivalent no greater than the equivalent cost of coal
transport for the voyage then underway, at the time charter rate
then payable. The first delivery of such coal shall be made
within 45 days from the date the Vessel first entered an
operational off-hire period, unless otherwise directed by
Charterer. Charterer will discuss with Owner the possible use of
non U.S. flag substitute tonnage, to the extent suitable and
provided Charterer does not use its own sources for non U.S. flag
tonnage. In any event, Charterer will be under no obligation to
accept non U.S. tonnage from Owner.
D. The commencement of an operational off-hire period
shall be four hours after the Vessel experiences an operational
off-hire event defined in this Clause 46A, as reported by the
Vessel, at which time hire shall cease to be payable.
Operational off-hire shall terminate upon the Vessel reaching an
equivalent position with respect to vessel's operations underway
at the time the operational off-hire period commenced. Any
provision of this Charter to the contrary notwithstanding, the
Charterer shall not pay hire for any period of operational
off-hire even if the period(s) of operational off-hire in any one
Charter Year reduce(s) the number of days on-hire below the
minimum specified in Clause 1.
E. The commencement of a commercial off-hire period shall
be when the Vessel passes sea buoy at the entrance to Chesapeake
Bay in ballast condition or comparable point of deviation, at
which time hire shall cease to be payable. Commercial off-hire
shall terminate, and hire shall be payable upon, the Vessel
reaching the following points:
(i) if Charterer orders the Vessel to a South America
coal load port as the first voyage after delivery of the
Vessel after termination of a commercial off-hire period,
then delivery shall take place 24 hours after dropping last
outbound sea pilot at the last port where Vessel called for
the Charterer or where the Vessel called during the
commercial off-hire period, or whichever is less;
(ii) if Charterer orders the Vessel to a US East Coast
coal load port as the first voyage after delivery of the
Vessel after termination of a commercial off-hire period,
then delivery shall take place on passing the sea buoy at
the entrance to Chesapeake Bay or comparable position prior
to arrival at that next load port;
(iii) if Charterer orders the Vessel to any other port
not specified in (i) or (ii) above, after delivery of the
Vessel after termination of a commercial off-hire period,
then delivery shall take place at such time as the Vessel
would have reached an equivalent position on a round trip
voyage basis had the commercial off-hire period not taken
place.
F. Upon redelivery of the Vessel to Owner at the
commencement of pre-agreed commercial off-hire periods, or upon
delivery of the Vessel to Charterer at the end of such periods,
or as soon thereafter as practicable, surveys of bunker coal
and/or fuel oils shall be conducted. Expenses for fuel surveys
shall be borne equally by Owner and Charterer. Time required for
such surveys shall be for Owner's account when delivering to the
Charterer, and shall be for the Charterer's account when
redelivering to Owner. Surveyed quantities shall be adjusted up
or down to account for the advance periods of delivery and
redelivery specified above, in accordance with vessel records of
fuel actually consumed during these periods. With regard to
fuels actually consumed during these periods, Owner agrees to
make available to Charterer adequate records of same.
47. ATTACHMENT, ARREST, ETC.
A. If the Vessel shall be detained (otherwise than in the
normal course of her business or operations) attached, arrested
or if the Vessel shall be otherwise levied upon or taken into
custody by virtue of proceedings in any court or tribunal in the
United States or any foreign country or by any governmental or
other authority, Owner shall cause (i) the Vessel to be released
as promptly as practicable and in any event within five days
after any such attachment, arrest, levy or taking occurring in
the United States, and (ii) any lien to be discharged to the
extent that such lien is not being contested in good faith by or
on behalf of the Owner through appropriate proceedings without
risk of a sale, forfeiture or loss of the Vessel. In the event
the Vessel is detained (otherwise than in the normal course of
her business or operations), arrested, attached or levied upon or
taken into custody by any authority whatsoever, and it appears
that such will interfere with the next anticipated redelivery
event, Owner will immediately notify the Charterer.
B. Subject to Section 46, in the event of loss of time of
the Vessel by virtue of a detention, attachment, arrest, levy or
other taking into custody of the Vessel (but excluding loss of
time due to action or inaction of Charterer or its agents or due
to liens or claims which predate Owner's title in the Vessel),
the Vessel will be on operational off-hire for all time so lost.
However, in all cases of such detention, attachment, arrest, levy
or other taking into custody, Owner will ensure that its P&I Club
will post the appropriate bond, letter of undertaking or other
security to promptly release the Vessel.
48. ASSIGNMENTS
A. This Charter shall not be assigned by either party
without the prior written consent of the other party. In any
such event and notwithstanding any such assignment and consent,
assignor shall continue to perform its duties and obligations
under this Charter Party and shall remain responsible as primary
obligor therefor, unless it provides acceptable assurances to the
other party covering any liabilities of the assignee.
B. Owner's rights and obligations under this Charter are
not transferable by sale without Charterer's consent. In the
event of the Vessel being sold without its consent Charterer may
(including a requisition for title pursuant to Clause 33A), at
its absolute discretion, terminate the Charter upon written
notice to the Owner (except with respect to obligations and
liabilities hereunder, actual or contingent, which have arisen on
or prior to such date of termination), without being required to
purchase the Vessel, without prejudice to any of Charterer's
other rights or remedies.
49. WAR RISK INSURANCE
Any increase in War Risk Insurance costs because of
increased rate over those in effect on date of this Charter, and
prompted by voyages to war risk zones by the Charterer shall be
for Charterer's account. The Vessel's valuation in such
insurance shall be mutually agreed to by Owner and Charterer.
50. ICE SECTION
The Vessel shall not be ordered to or bound to enter any
icebound port or place or any place where lights, lightships,
marks or buoys on Vessel's arrival are or are likely to be
withdrawn by reason of ice, or where there is a risk that
ordinarily Vessel will not be able on account of ice to enter,
reach or leave the place. Vessel shall not be obliged to force
ice nor to follow icebreakers. If on account of ice the Master
considers it dangerous to enter or remain at any loading or
discharging place for fear of the Vessel being frozen in and/or
damaged, he shall have the liberty to sail to another place or
port which is free from ice and there await Charterer's further
instructions. This Clause shall be deemed incorporated in Bills
of Lading under applicable circumstances.
51. BILL OF LADING SECTIONS
All Bills of Lading issued under this Charter shall contain
the Clause Paramount, War Risks, Both-to-Blame, New Jason and Ice
Section in form and substance as set forth herein.
52. TERMINATION
This Charter may be terminated by Charterer at any time
after seven years from initial delivery hereunder for any reason
upon not less than 180 days prior written notice from Charterer
to Owner and provided that it include or be accompanied by a
Notice of Intention to Exercise Purchase Option for the Vessel,
in accordance with Appendix 4 of this Charter. Such notice shall
specify a provisional Termination Date.
If, however, a Notice of Intention to Exercise Purchase
Option is made by Charterer pursuant to this Clause, and the
purchase is not consummated on the provisional Termination Date,
or within 30 days thereof, such Notice of Intention to Exercise
Purchase Option shall be deemed to have been withdrawn. This
Charter shall thereupon continue as though no such Notice had
been given, except that Charterer agrees to reimburse Owner for
costs, if any, directly related to the planned purchase of the
Vessel, subject to a cap of $50,000.
53. OPTION TO SHORTEN CHARTER PERIOD
a. Charterer will have the option declarable the latest by
the end of the 12th Charter Year to change the charter period to
thirteen (13) consecutive years, in which case Charterer will pay
Owner in addition to the aforementioned charter hire (plus
escalation as applicable) for the days on-hire during the 13
consecutive years, a lump sum charter hire of Thirteen Million
Three Hundred Thousand Dollars ($13,300,000) on the last day of
the Charter.
b. Charterer will also have the option declarable the
latest by the end of the 13th Charter Year to change the charter
period to fourteen (14) consecutive years, in which case
Charterer will pay Owner in addition to the aforementioned
charter hire (plus escalation as applicable) for the days on-hire
during the 14 consecutive years, a lump sum charter hire of Six
Million Six Hundred Fifty Thousand Dollars ($6,650,000) on the
last day of the Charter.
c. Upon exercising either option Charterer shall have the
right to prepay the said lump sum charter hire (with adjustment
for accelerated payment) in installments over the remaining term
of the Charter, at the time of each monthly payment of hire is
made, with effect from the first day of the month in which the
declaration is made. The adjustment for accelerated payment
shall be calculated by discounting for the relevant period of
acceleration the applicable lump sum, using the interpolated
United States Treasury rate corresponding to the period of time
from the date of the exercise of the option until the anticipated
end of the Charter.
54. INSURANCE
At all times during the term of this Charter, the Owner
shall cause the Vessel to be insured, through responsible and
experienced marine underwriters, for all customary risks
including but not limited to hull, increased value, protection
and indemnity, including pollution coverage, war risk, and second
seaman's war risk in amounts no less than commercially reasonable
and appropriate amounts. Owner shall also carry excess liability
insurance in such amount as Owner and Charterer shall agree. All
policies shall be with companies and under policy forms approved
by Owner and Charterer, such approvals not to be unreasonably
withheld.
All policies shall name as assureds, as interests may
appear, Owner and Charterer with a waiver of subrogation as
against the Charterer. Owner shall provide and/or afford
Charterer access to all documentation and records relating to
insurance for or relating to the Vessel.
55. INTERIM VOYAGES BY OWNER
It is recognized by the parties that there will be
reoccurring periods of commercial off-hire. Redelivery and
delivery events will therefore occur when the Charterer places
the Vessel in commercially off-hire mode in accordance with
Clause 46, and when the Charterer desires the return of the
Vessel to its customary trades, respectively.
During these periods of commercial off-hire, the Owner may
trade the Vessel in any lawful cargo and between any ports which
it chooses. Upon completion of any commercial off-hire period,
Owner shall deliver the Vessel to Charterer with holds clean and
dry, free of cargo, and ready in all respects to load steam coal.
Any provision of this Charter to the contrary
notwithstanding, Charterers shall have no responsibility or
liability whatsoever for or relating to the Vessel or her
operation during periods of commercial off-hire or any
consequences thereof.
56. STEVEDORE DAMAGE
Stevedores will be appointed by and paid for by Charterer.
Should any damage be caused to the Vessel or her fittings by the
stevedores, the Master has to try to let stevedores repair such
damage and try to settle the matter directly with them. The
Master also shall endeavor to obtain written acknowledgment of
the damage and liability from the concerned stevedores
immediately at the occurrence. Charterer shall not be
responsible for any damage caused by stevedores to the Vessel
unless the Master immediately notifies Charterer or its agents of
such damage within 24 hours from the occurrence. Such notice
will specify the damage in detail and invite Charterer to appoint
a surveyor to participate in assessing the extent of such damage.
If Charterer is responsible hereunder:
A. In the case of any damage(s) affecting the Vessel's
seaworthiness and/or the safety of the crew and/or affecting the
trading capabilities of the Vessel, the Charterer will
immediately arrange for repairs of such damage(s) at its expense
and the Vessel is to remain on-hire until such repairs are
completed and, if required, passed by the Vessel's classification
society.
B. Any damage(s) not described under A above will be
repaired, at Charterer's option, before or after redelivery
concurrently with Owner's work. In such case no hire and/or
expenses will be paid to Owner except when the time and/or the
expenses required for the repairs for which Charterer is
responsible exceed the time and/or expenses necessary to carry
out Owner's work.
57. LIGHTERING
Vessel may lie safely alongside another
vessel/coasters/lighters at a safe dock, wharf or place
(including anchorages) for transshipment and/or discharge of
cargo and/or bunkering if such operation is customarily carried
out at such places. Such operation will be carried out always
subject to good weather, smooth and calm sea, slight wind and
current when Master thinks fit and safe under the supervision of
and at the discretion of the Master. The Master may at any time
order the vessel/coasters/lighters away from his Vessel, or
remove his own Vessel, at Charterer's time and expense. If the
Master considers the double banking by ship's own propelling
unsafe, the Master may include tug services at Charterer's time
and expense. Charterer will supply extra fenders and/or securing
materials, if necessary, and indemnify Owner/Vessel against all
cargo claims as a result of such operation. Charterer also will
indemnify Owner from any additional insurance premium to cover
additional risks for Vessel, loss of hire and/or shipowner
liabilities, and Charterer will give Owner due advance notice of
their intention to perform such operation advising approximate
type and quantity of cargo involved, the other vessel concerned
destination of cargo and location of operation. Charterer will
always indemnify Owner for any damages to Vessel, claims from the
other alongside vessel and/or loss of hire resultantly incurred
from the unsafety of the operations and/or any omission
occasioned by crew members of both vessels.
58. MISCELLANEOUS
This Charter, including all Appendices referenced herein,
constitutes the entire understanding of the parties with respect
to the subjects referenced herein and there are no
representations, understandings, agreements, oral or written,
which are not included herein. The terms and provisions hereof
shall extend to and be binding upon the successors and assigns of
the parties hereto. Any amendment hereto shall be evidenced by a
writing signed by a duly authorized representative of each party.
Should any provision of this Agreement be held invalid, such
provision shall be considered severable and such invalidity shall
not affect the remainder of the provisions herein. The failure
of either party to insist in any one instance or more upon strict
performance of any of the terms and conditions hereof, or to
exercise any right or privilege herein conferred, shall not be
construed as waiver of such terms, conditions, rights or
privileges, but the same shall continue and remain in full force
and effect. The article headings in this Charter are for
descriptive purposes only.
59. NOTICES
Except as otherwise provided in this Charter, all notices,
demands, designations, certificates, requests, offers, consents,
approvals and other instruments given pursuant to this Charter
shall be in writing and shall be validly given when sent by
overnight courier delivery or by telefax (a) if to Owner,
addressed to International Shipholding Corporation, One Whitehall
Street, New York, New York 10004, Attention: Niels M. Johnsen,
Vice President, and (b) if to Charterer, addressed to New England
Power Company at 25 Research Drive, Westborough, Massachusetts
01582, Attention: Sheridan A. Glen, Director, Coal and Oil.
Owner and Charterer each may from time to time specify any
address in the United States as its address for purposes of this
Charter by giving 15 day's written notice to the other party.
IN WITNESS WHEREOF, the parties by each of its duly
authorized representative signs in the spaces set forth below
this 1st day of November, 1994.
WITNESS International Shipholding Corp. on
its own behalf and on behalf of its
Nominee
WITNESS New England Power Company
APPENDIX 2A
S.S. ENERGY INDEPENDENCE
CHARTER PARTY DATED OCTOBER 27, 1994
Speed Warranty Calculation
1. The sea passage portion of both the laden and ballast legs
of all voyages (load port to load port) shall be used,
excluding in their entirety both legs of any voyage during
which:
(a) the Vessel reduced its speed at Charterer's request or
due to fog or due to other adverse weather conditions
or as provided in paragraph 4 below; or
(b) the Vessel encountered winds in excess of Beaufort 5
for a sustained period of 2 hours or greater.
All voyages not so excluded are referred to as the
"Qualifying Speed Voyages". Owner will ensure at least
three (3) Qualifying Speed Voyages per year.
2. The log records shall be used to determine the time and
distance of the sea passages on all Qualifying Speed
Voyages. The sea passage shall begin at the load port sea
buoy (or the discharge port sea buoy, as the case may be)
and end at the discharge port sea buoy (or the load port sea
buoy, as the case may be). For ballast voyages from Salem
Harbor utilizing the Cape Cod Canal, the discharge port sea
buoy shall be the Buzzard's Bay pilot station.
3. The average speed on the Qualifying Speed Voyages shall be
calculated by dividing (a) the total nautical miles
travelled on the sea passages of all of the Qualifying Speed
Voyages by (b) the total time in hours utilized on such sea
passages. If such average speed is less than 14.47 knots,
the speed guarantee payment to be paid by Owner to Charterer
pursuant to Clauses 5B, C and D of the Charter shall be
calculated in accordance with the following example:
Assumption:
Qualifying Speed Voyages -
Total Elapsed Time Sea Buoy to Sea Buoy Legs: 1,200 hrs.
Average Speed: 14.4 knots
Total Nautical Miles: 17,280
Warranty Speed: 14.47 knots
Total Time in Calendar Year (excluding time under Paragraph 4
below) Sea Buoy to Sea Buoy: 4,000 hrs.
Daily Hire for Charter Year: $45,000
Calculation:
Time Allowed on Qualifying Speed Voyages at Warranty Speed:
17,280 mi = 1,194.19 hrs.
---------
14.47 kts
Excess Time on Qualifying Speed Voyages = 1,200.00 hrs.
- 1,194.19 hrs.
-------------
5.81 hrs.
Excess Time Percentage: 5.81 = 0.484%
-----
1200
Penalty Hours: 0.484% x 4,000 hrs. =
19.36
Penalty Days: 19.36 = 0.8067
-----
24
Total Penalty: 45,000 x 0.8067 = $36,301.50
4. In the event the Vessel's maximum speed is reduced during
any sea passages from sea buoy to sea buoy by 10% or more as
a result of a breakdown of the Vessel, the entire period
during which the Vessel is required to operate at such
reduced speed ("Breakdown Speed Period") shall be eliminated
from the speed performance calculations of the calendar year
in question under paragraphs 1 through 3 above. Owner shall
notify Charterer of any Breakdown Speed Period within five
(5) days of the occurrence of the breakdown. Charterer's
claim for speed deficiency for all sea passages from sea
buoy to sea buoy during any Breakdown Speed Period shall be
made separately as against the same warranted speed and in
the same manner as provided in paragraphs 1 through 3 above
based upon voyages which would otherwise be Qualifying Speed
Voyages but for the breakdown.
5. Amounts payable under this Appendix 2A shall not be netted
against any amounts payable under Appendices 2B or 3.
APPENDIX 2B
S.S. ENERGY INDEPENDENCE
CHARTER PARTY DATED OCTOBER 27, 1994
Fuel Warranty Calculation
Sea Passage Warranty
1. The sea passage portion of both the laden and ballast legs
of all voyages (load port to load port) shall be used,
excluding in their entirety both legs of any voyage during
which:
(a) the Vessel reduced its speed at Charterer's request or
due to fog or due to other adverse weather conditions
or breakdown of the Vessel; or
(b) the Vessel encountered winds in excess of Beaufort 5
for a sustained period of 2 hours or greater.
All voyages not so excluded are referred to as the
"Qualifying Fuel Voyages".
2. The log records shall be used to determine the time and
distance of the sea passages on all Qualifying Fuel Voyages.
The sea passage shall begin at the load port sea buoy (or
the discharge port sea buoy, as the case may be) and end at
the discharge port sea buoy (or the load port sea buoy, as
the case may be). For ballast voyages from Salem Harbor
utilizing the Cape Cod Canal, the discharge port sea buoy
shall be the Buzzard's Bay pilot station.
3. Fuel consumption on any sea passage shall be determined as
recorded in the ship's logs.
4. The average fuel consumption on sea passages on the
Qualifying Fuel Voyages shall be equal to (a) the total fuel
consumed on the sea passages of the Qualifying Fuel Voyages,
divided by (b) the time taken on such sea passages (in
hours).
Load Port/Discharge Port Warranty
1. The portion of all voyages during which the Vessel is at
berth in the load/discharge port shall be used. Such
voyages are referred to as the "Qualifying Ports".
2. The log records shall be used to determine the time and fuel
consumption at the load/discharge ports on all Qualifying
Ports. The time spent at berth in the load/discharge port
shall begin at FWE and end at STBY Engines.
3. The fuel consumption per day at the load/discharge berth on
the Qualifying Ports shall be equal to (a) the total fuel
consumed at the load/discharge berth on the Qualifying
Ports, divided by (b) the total time in hours spent at
load/discharge berth on such voyages.
Warranty Charge Calculation Formula:
The fuel warranty charge (if any) payable by Owner to
Charterer pursuant to Clauses 5B, C and D of the Charter
shall be calculated in accordance with the following:
A. Load Port: (Warranty: 38 mmbtus per hr.)
Total time in LP = sum of (FWE - STBY) for
all Qualifying Ports
Allowed consumption in LP = (Total Time (hrs) x 38)
= a1 mmbtus
Actual consumption in LP = b1 (from log books) mmbtus
Adjustment = b1 - a1 mmbtus
$ Adjustment only if b1 - a1
is positive:
(b1-a1) x Avg. Fuel
Cost/Year in $ per mmbtus = A1$
B. Discharge Port: (Warranty: 42 mmbtus per hr.)
Total time in DP = sum of (FWE - STBY)
for all Qualifying Ports
Allowed consumption in DP = (Total Time (hrs) x 42)
= a2 mmbtus
Actual consumption in DP = b2 (from log books) mmbtus
Adjustment b2 - a2 = mmbtus
$ Adjustment only if b2 - a2
is positive:
(b2 - a2) x Avg. Fuel
Cost/Year in $ per mmbtus = A2 $
C. Sea Passage/Navigation: (Warranty: 119 mmbtus per hr.)
Total fuel consumed in Charter Year = X
Fuel consumption in all LP/DP = (b1 + b2)
Actual Sea/Navigation consumption = [X - (b1 + b2)]
= X1
Total time at sea = Hours from sea buoy to sea buoy
(from logbooks)
Allowed consumption at sea = (Total Time x 119) = c1
Actual consumption at sea = d1 (from log books) mmbtus
Engine Efficiency:
(only if d1 > c1) = d1 = y1
c1
$ Adjustment Allowed only if y1
is > 1.0:
[x1 - x1] x Avg. Fuel
y1
Cost/Year in $ per mmbtus = A3 $
Payment of a fuel warranty charge is due only if A1, A2
and/or A3 are positive numbers, with no netting of one against
the other or against any payment due under Appendices 2A or 3.
Example:
The following example illustrates application of this
formula:
Assumptions:
Performance on Qualifying Fuel Voyages, Loadings and
Discharges:
at sea - 130 mmbtus/hour
at load port - 40 mmbtus/hour
at discharge port - 44 mmbtus/hour
Warranted Performance:
at sea - 119 mmbtus/hour
at load port - 38 mmbtus/hour
at discharge port - 42 mmbtus/hour
Average cost of fuel delivered to the Vessel during calendar
year:
$1.85/mmbtus
Actual usage during the calendar year:
Total: 795,000 mmbtus (from ship's log)
at load port 68,000 mmbtus (from ship's log)
at discharge port 77,000 mmbtus (from ship's log)
at sea (sea buoy 520,000 mmbtus (from ship's log)
to sea buoy)
balance is:
navigation passage: 130,000 mmbtus
sum of:
sea and navigation: 650,000 mmbtus
Calculations:
A. Load Port:
Total time in LP = 72 x 24 = 1,728 hours
Allowed consumption in LP = 1,728 x 38
= 65,664 mmbtus
Actual consumption in LP = 68,000 mmbtus
Adjustment 68,000 - 65,664 = 2,336 mmbtus
$ Adjustment 2,336 x 1.85 = (A1)
= $ 14,321.60
B. Discharge Port:
Total time in DP = 74 x 24 = 1,776 hours
Allowed consumption in DP = 1,726 x 42
= 72,492 mmbtus
Actual consumption in DP = 77,000 mmbtus
Adjustment 77,000 - 72,492 = 4,508 mmbtus
$ Adjustment 4,508 x 1.85 = (A2)
= $ 8,339.80
C. Sea Passage/Navigation
Actual sea/navigation
consumption:
Total - LP/DP = 650,000 mmbtus
Total time at sea = 4,000 hours
Allowed consumption at sea = 4,000 X 119
= C1
= 476,000 mmbtus
Actual consumption at sea = d1
= 520,000 mmbtus
Engine efficiency = d1/c1 = Y1
= 1.0924
Dollar adjustment:
(650,000 - 650,000) x $1.85 = A3
1.0924 = 54,980 x 1.85
= $101,713
Payment adjustment:
from Owner to Charterer:
A1 = $ 4,321.60
A2 = $ 8,339.80
A3 = $101,713.00
Total due:
from Owner to Charterer:
$ A1 + A2 + A3 = $114,374.40
APPENDIX 3
S.S. ENERGY INDEPENDENCE
CHARTER PARTY DATED OCTOBER 27, 1994
Unloader Test Procedure
And Warranty Calculation
1. The time utilized for unloading the Vessel during any test
shall be measured from the time the Vessel commences
operation of her unloading equipment until she ceases such
operation upon completion of discharge without deductions
for any reason other than reduction or cessation of
unloading at the request of Charterer.
2. The tonnage unloaded shall equal (a) the coal on board prior
to loading, as reported in the Vessel's logs, plus (b) the
coal loaded as stated in the bill of lading, less (c) the
coal remaining on board after discharging, as reported in
the Vessel's logs, provided the Vessel shall not be deemed
to have effected a complete unloading until the amount of
cargo coal remaining on board is less than 200 short tons.
3. The test unloading rate shall be the tonnage unloaded, as
determined in paragraph 2 above, divided by the time
utilized for unloading the Vessel, as determined in
paragraph 1 above. If a test requested by Charterer is
completed and results in an average unloading rate of less
than 3,100 short tons per hour, the Vessel shall be
considered out of compliance with the discharge warranty
provided in Clause 5E of the Charter, until such time as the
Vessel completes a full load discharge test pursuant to
Clause 5E and this Appendix 3 at an average discharge rate
of 3,100 short tons per hour or more. In the event that the
Owner fails to make necessary repairs to the Vessel so that
it passes such unloading test at the next discharge port,
damages payable by Owner to Charterer shall be calculated in
accordance with the following example:
Assumptions:
Performance in the discharge test requested by
Charterer: 2,900 short tons/hour
Number of short tons unloaded between failing the
initial unloading test and passing a compliance test in
accordance with the above procedure (but not including the
tonnage unloaded in either test): 240,000
Hours unloading @ 3,100 ST/HR = 240,000 = 77.42 hours
3,100
Hours unloading @ 2,900 ST/HR = 240,000 = 82.76 hours
2,900
Time deemed lost due to non-compliance:
82.76 - 77.42 hrs. = 5.34 hrs. = 0.2225 days
Daily rate at $45,000 per day
Damages payable by Owner:
0.2225 days x $45,000 = $10,012.50
4. Amounts payable under this Appendix 3 shall not be netted
against any amounts payable under Appendices 2A or 2B.
APPENDIX 4
Charterer's Purchase of Owner's
Rights in the Vessel
1. Acknowledgment. Owner acknowledges that Clause 52 of
this Charter, as worded, entitles Charterer for any reason
whatsoever in its absolute and unfettered discretion to terminate
this Charter effective any time after seven charter years have
elapsed from the commencement of the Charter, provided such
termination is pursuant to a Notice of Intention to Exercise
Purchase Option given not less than 180 days in advance of such
termination.
2. Termination Date. As used in this Charter, the
Termination Date is the date on which Charterer consummates its
purchase of Owner's Rights in the Vessel, under Clause 3B or
Clause 52 of this Charter. Unless otherwise terminated, the
Charter shall remain in full force and effect until the
Termination Date.
3. Owner's Rights in the Vessel. As used in this Charter,
the term "Owner's Rights in the Vessel" shall mean and include
all of Owner's right, title and interest in and to the Vessel,
and all rights, claims, causes of action, benefits and other
legal or equitable interests deriving from, or accruing to Owner
as a result of constructing, owning, leasing, financing,
operating, chartering or using the Vessel including, without
limitation, all of Owner's right, title and interest in and to
the following:
(a) the Vessel, together with her engines, boilers,
machinery, masts, boats, anchors, cables, chains, tackle,
apparel, furniture, capstans, pumps, hatches, unloading
systems and all other appurtenances thereto, and also any
and all additions, improvements and replacements made in or
to the Vessel or said appurtenances and all spare parts
ashore and on board;
(b) contracts, now in existence or hereafter entered
into, relating to the construction, reconstruction and
repair of the Vessel;
(c) all agreements and commitments relating to the
financing of the Vessel, including, as the case may be, the
construction, reconstruction, repair and/or purchase of the
Vessel, to the extent such rights and benefits are
transferable, and providing Charterer opts to purchase the
Vessel subject to any mortgage lien on the Vessel;
(d) any charters and/or sub-charters with respect to
the Vessel and hire due thereunder on and after the
Termination Date;
(e) all proceeds payable under insurance policies or
insuring agreements with respect to the Vessel, to the
extent such proceeds are not in reimbursement of any amounts
theretofore paid by or for the account of Owner;
(f) the proceeds of salvage and general average, to
the extent that such proceeds relate to physical damage to
or loss of the Vessel arising out of salvage or general
average, and to the extent said damage or loss has not been
repaired or replaced by Owner; and
(g) the compensation, award or proceeds arising out of
or relating to such period of requisition of use of the
Vessel, if any, which extends after the Termination Date,
providing such requisition has not previously resulted in
termination of this Charter.
4. (a) Purchase Free of Mortgage Lien. In connection
with a Notice of Intention to Exercise Purchase Option, Charterer
may elect to purchase Owner's Rights in the Vessel free and clear
of any mortgage lien on the Vessel, in consideration for which
Charterer shall pay to Owner or its designee a purchase price in
U.S. dollars (the "Purchase Value") equal to the applicable
number set forth in Column 2 of Table 1 below opposite the period
in which the date of purchase occurs (period 1 commencing with
the delivery of the Vessel under the Charter and ending on and
including _________, 1995 and each succeeding period being each
of the following semi-annual periods of this Charter occurring
thereafter). If Charterer shall purchase Owner's Rights in the
Vessel pursuant to this subparagraph (a), Owner shall on the
Termination Date convey good title to the Charterer or its
designee in and to Owner's Rights in the Vessel free of (i) all
charges, liens, security interests and encumbrances arising from
acts of Owner taken without the consent of the Charterer, other
than those arising out of current operations of the Vessel in
accordance with this Charter, and (ii) any mortgage lien on the
Vessel. Charterer or its designee will accept such interest or
title in Owner's Rights in the Vessel.
Table 1
Beginning of Eighth Year Purchase Option Effective at
in Semi-Annual Periods Beginning of Each Semi-Annual Period
- ------------------------ ------------------------------------
15 55175730
16 52259363
17 49300160
18 46780743
19 44223519
20 41631385
21 39007526
22 36355449
23 33679008
24 30982444
25 28270423
26 25548076
27 22821047
28 20095548
29 17378406
30 146771343
(b) Purchase Subject to Mortgage and Debt. In the
alternative, subject to the approval of lenders, Charterer may
elect to purchase Owner's Rights in the Vessel subject to any
mortgage lien on the Vessel, in consideration for which Charterer
shall (i) assume the obligations with respect to any such
mortgage lien on the Vessel, including the debt, and cause any
person liable with respect thereto to be released from all
liability thereunder, and (ii) pay to Owner an amount equal to
the purchase price which would otherwise be payable pursuant to
subparagraph (a) of this Clause 4, less the outstanding principal
amount of the Debt and accrued and unpaid interest thereon from
the last date through which Charter hire was paid under this
Charter to the date of purchase. If Charterer shall purchase
Owner's Rights in the Vessel pursuant to this subparagraph (b),
Owner shall, on the Termination Date, convey good title to
Charterer or its designee in and to Owner's Rights in the Vessel
free of all charges, liens, security interests and encumbrances
arising from acts of Owner taken without the consent of the
Charterer, other than the assumed mortgage lien and those arising
out of current operations of the Vessel in accordance with the
provisions of this Charter. Charterer or its designee will
accept such interest or title in and to Owner's Rights in the
Vessel.
5. Payment. On the Termination Date (a) Charterer shall
pay and deliver to Owner the consideration specified by Charterer
pursuant to Clause 4(a) or Clause 4(b) of this Appendix 4 for
Charterer's purchase of Owner's Rights in the Vessel, together
with all Charter hire, if any, and other sums then due and
payable hereunder to but not including such Termination Date, and
(b) Owner shall deliver to Charterer or its designee a Bill of
Sale in recordable form together with all other instruments
necessary to convey and assign all of Owner's Rights in the
Vessel with the quality of interest or title thereto specified in
connection with such purchase in Clause 3 of this Appendix 4, and
originals or copies of all applicable construction documents,
repair records, applicable Certificates of the United States
Coast Guard and classification societies, log books and such
other records as may be reasonably requested by Charterer in
connection with the purchase and operation of the Vessel.
6. Reservation Relating to Charter. Upon purchase of the
Vessel, Charterer has agreed to accept Owner's Rights in the
Vessel in accordance with the provisions of this Charter;
provided, however, that such acceptance does not relieve Owner of
any of its obligations pursuant to this Charter and does not
constitute a waiver by Charterer with respect to any breach
thereof, nor does it foreclose the exercise by Charterer of any
of Charterer's rights, powers or remedies with respect thereto.
7. Termination. Unless terminated earlier in accordance
with the provisions of this Charter or by operation of law, this
Charter shall terminate upon the completion of Charterer's
purchase, except with respect to obligations and liabilities of
the parties, actual or contingent, which have arisen under this
Charter on or prior to such date of purchase.
8. Owner's Further Assurances and Assistance. Owner shall,
at Charterer's expense, take such steps as Charterer may
reasonably require to furnish further assurances of the transfer
to Charterer of Owner's Rights in the Vessel and for the purpose
of enforcing Charterer's rights as transferee and assignee of
Owner's Rights in the Vessel.
9. Transition Clause. (a) After delivery by Charterer of
a Notice of Intention to Exercise Purchase Option and until
delivery (the "Interim Operations Period"), the Vessel shall
continue to be operated in accordance with the Charter.
(b) During the Interim Operations Period, as permitted
under the terms of the Charter, Charterer may on its own behalf
and/or on behalf of its designee purchaser cause a qualified
consultant to accompany the Vessel on her voyages in order to
ensure that the Vessel is maintained in good condition and in
American Bureau of Shipping ("ABS") Class as required under the
Charter and to keep Charterers informed of the Vessel's
condition. Charterer shall pay the expense of any such
consultant.
(c) Charterer may on its own behalf and/or on behalf of its
designee purchaser place its representative at any drydock or
overhaul events occurring within the Interim Operations Period.
Upon request, Owner will promptly give to Charterer a copy of the
requisition of work to be performed during the drydocking period.
Upon request, Owner will provide Charterer with a copy of said
requisition. Upon request, Owner will permit Charterer's
representative to make a complete survey of the Vessel at the
shipyard and in drydock. If Charterer makes such a survey,
Charterer will promptly thereafter advise Owner of any additional
work which needs to be performed in order to maintain class with
ABS so that the Vessel will leave the drydock period with a clean
American Bureau of Shipping certificate, confirming that the
Vessel is in class, free of outstanding recommendations, and with
confirmation that the Vessel is in compliance with this Charter,
in particular Clauses 3 and 6 thereof. The cost of the
aforementioned shipyard work to comply with class requirements
will be paid for by Owner.
(d) In the event Charterer requests any requisition for
work items to be added for drydock or overhaul periods which are
not necessary to maintain the Vessel's classification status, or
to free the Vessel from outstanding recommendations, or return
the Vessel to seaworthy condition, Owner agrees to use its best
efforts to accommodate Charterer's request for such work to be
completed at drydock. Any such work and resulting extra time, if
any, for drydocking charges, shall be for Charterer's account.
10. Place and Time of Delivery. The Vessel shall be
delivered hereunder on the Termination Date, safely afloat, at a
safe berth in a safe port, as directed by Charterer. Owner shall
give 30/15 days approximate notice of the delivery date, followed
by 10/5 days definite notice of Vessel's expected readiness, and
shall keep Charterer advised of Vessel's itinerary. If Charterer
requires delivery to a designee, whether or not related to
Charterer, Owner's delivery obligation shall be performed and
satisfied by duly conveying Owner's Rights in the Vessel to
Charterer's designee.
11. Drydocking. (a) Prior to delivery of the Vessel, the
Charterer (or its designee) may cause the Vessel to be placed in
drydock at the port of delivery for inspection by ABS
representatives of the bottom and other underwater parts below
the Summer Load Line. If the ABS representatives find the
rudder, propeller, bottom or other underwater parts below the
Summer Load Line to be broken or defective so as to affect the
Vessel's clean certificate of class, such defects shall be made
good at Owner's expense to ABS satisfaction without
qualification.
(b) While the Vessel is in drydock, and if requested by the
Charterer (or its designee) or the ABS representative, the
tail-end shaft shall be drawn. Should same be condemned or found
defective so as to affect the Vessel's clean certificate of
class, it shall be renewed or made good at Owner's expense to ABS
satisfaction without qualification.
(c) The expenses of drawing and replacing the tail-end
shaft shall be borne by Owner. In all other cases the Charterer
(or its designee) shall pay the aforesaid expenses, dues and
fees.
(d) The expenses in connection with putting the Vessel in
and taking her out of drydock, including drydocking dues and the
ABS surveyor's fee, shall be paid by Owner if the rudder,
propeller, bottom, other underwater parts below the Summer Load
Line or the tail-end shaft be found broken, damaged or defective
so as to affect the Vessel's clean certificate of class. In all
other cases the Charterer (or its designee) shall pay the
aforesaid expenses, dues and fees.
(e) During the above-mentioned inspections by ABS,
representatives of Charterer and/or its designee shall have the
right to be present in the drydock, but without interfering with
the ABS surveyors' decisions.
(f) Promptly after delivery of the Vessel, the Charterer
(or its designee) may have the manufacturer of the inclined lift
conveyor system inspect the same and issue its report to
Charterer, as designee and Owner stating whether the system is in
operating condition adequate to meet the discharge rate warranty
in the Charter, or, if not, what repairs are required to bring
the system up to such operating condition. Any repairs and/or
refurbishment, including repairs to the teflon panels in the
cargo holds/hoppers, which are necessary to place the system in
such operating condition, will be performed at Owner's expense.
Owner's representative shall have the right to be present while
such inspection is being made, but without interfering with the
manufacturer's decisions.
12. Condition On Delivery. Any other provision of this
Charter to the contrary notwithstanding, if at the time scheduled
for delivery, work remains to be done to maintain or bring the
Vessel within ABS Class free of outstanding recommendations
("Remaining Work"), Charterer (or its designee) at its own option
may (a) accept delivery of the Vessel as is, where is, under
terms of this Appendix 4 and the Remaining Work will thereafter
be done at Owner's expense or (b) reschedule the Termination Date
and the delivery of the Vessel to take place after completion of
the Remaining Work.
13. Encumbrances. Providing Owner is able to deliver and
pass title to the Vessel to Charterer, should any claims and/or
liens which have been incurred prior to the time of delivery (but
not before original delivery to Owner under MOA dated October 27,
1994) be asserted against the Vessel or interfere with the
Vessel's operation, Charterer shall take delivery and title,
provided, however, that Owner shall hold Charterer harmless from
and indemnify Charterer against Charterers' payment of any such
claims and/or liens against the Vessel, but in no event shall
Owner be liable for Charterer's incidental or consequential
damages or losses, howsoever arising, whether claimable in law,
equity or otherwise, including, without limitation, any loss of
profits.
14. Revocable Notice. Charterer at any time for any reason
shall have the unfettered right to withdraw its Notice of
Intention to Exercise Purchase, provided, however, that Charterer
shall give Owner as much notice of its intention to withdraw said
Notice as is feasible and shall pay Owner the direct operational
costs, if any, theretofore caused by or resulting from said
Notice, subject to a cap of $50,000.
NEW YORK, NEW YORK
SEPTEMBER 22, 1995
ADDENDUM NUMBER ONE
TO TIME CHARTER OF S/S ENERGY INDEPENDENCE BETWEEN INTERNATIONAL
SHIPHOLDING CORPORATION OR ITS GUARANTEED NOMINEE, AS OWNER, AND
NEW ENGLAND POWER COMPANY OR ITS NOMINEE, AS CHARTERER, DATED
OCTOBER 27, 1994
It is this day mutually agreed that this Charter is amended, as
follows:-
CLAUSE 2. "DELIVERY/REDELIVERY EVENTS"
Is DELETED and substituted for by the following Clause:-
-------
"2. "DELIVERY/REDELIVERY EVENTS"
Under the terms and conditions of the MEMORANDUM OF AGREEMENT
(MOA) dated October 27, 1994 between New England Power Company
(NEP), as Seller, and International Shipholding Corporation (ISC)
and a Guaranteed Nominee of ISC to be named, as Buyers, Clause 6
thereof stipulates, in part, that "Buyers shall accept delivery
of the Vessel as is, where is, free of registered encumbrances".
Delivery under this Charter will take place simultaneously with
delivery under the aforementioned MOA at the same time and same
place. Thereupon the terms and condition of this Charter are in
full force and effect. After the simultaneous delivery under the
MOA and this Charter, the terms and conditions of both the
aforementioned MOA and this Charter are applicable to the period
and to the events that occur after said simultaneous delivery of
the Vessel. Any time used after the initial delivery under this
Charter for purposes of performing drydocking and shipyard work
will be off-hire (but NEP remains responsible for reimbursement
payments as per Clause 11 and hire payments, if any, as per
Clause 9 (f) - "Dry Docking" of the MOA). If the drydocking and
shipyard work occupy more than 65 days, Charter Year One must be
extended so that at the initial commencement of on-hire it
includes a minimum of 300 days as contemplated in Clause 1 of
this Time Charter. Upon termination of the Charter including
extensions, if any, the Vessel will be redelivered to the Owner
at any port on the United States East Coast at Charterer's
option, free of cargo. Charterer is to give the Owner 30 days
prior notice of the place of redelivery.
"It is recognized by the parties that there will be re-occurring
delivery and redelivery events during the period of this Charter.
All such events other than delivery and redelivery at the
commencement and termination, respectively, of this Charter,
shall be guided by Clause 46 herein."
APPENDIX 4 - Paragraph 4 (a) - DELETE "(period 1 commencing on
May 1, 1995 and ending six months later, on November 1, 1995, and
each succeeding period being each of the following semi-annual
periods occurring thereafter)" and SUBSTITUTE "(period 1
commencing on the date on which the purchase actually occurs and
ending six months later, and each succeeding period being each of
the following semi-annual periods occurring thereafter)".
All other terms and conditions of this Charter remain unaltered
and in full force and effect.
INTERNATIONAL SHIPHOLDING
CORPORATION ON ITS OWN BEHALF
AND ON BEHALF OF ITS
GUARANTEED NOMINEE NEW ENGLAND POWER COMPANY
s/ Niels W. Johnsen s/ Jeffrey D. Tranen
BY: _______________________ By: __________________________
Name: Niels W. Johnsen Name: Jeffrey D. Tranen
Title: Chairman Title: President
NEW YORK, NEW YORK
SEPTEMBER 22, 1995
ADDENDUM NUMBER TWO
TO TIME CHARTER OF S/S ENERGY INDEPENDENCE BETWEEN INTERNATIONAL
SHIPHOLDING CORPORATION OR ITS GUARANTEED NOMINEE, AS OWNER, AND
NEW ENGLAND POWER COMPANY OR ITS NOMINEE, AS CHARTERER, DATED
OCTOBER 27, 1994
It is this day mutually agreed that from and as of the date
hereof International Shipholding Corporation (ISC) and New
England Power Company (NEP) amend the Charter to provide that all
of the rights and obligations of the "Owner" under the Charter
have been assigned, set over and delegated to, and assumed and
accepted by Central Gulf Lines, Inc. (CGL) (a wholly-owned
subsidiary of ISC) in its own right as disponent owner of the
Vessel under the Bareboat Charter between Enterprise Ship
Company, Inc. (Enterprise), as Owner, and CGL, as Bareboat
Charterer, dated September 28, 1995 and not as ISC's Nominee.
All references in the Charter to "Owner" shall be deemed to be
references to CGL as disponent owner.
All other terms and conditions of this Charter remain unaltered
and in full force and effect.
INTERNATIONAL SHIPHOLDING NEW ENGLAND POWER COMPANY
CORPORATION
s/ Niels W. Johnsen s/ Jeffrey D. Tranen
By: __________________________ By: _____________________
Name: Niels W. Johnsen Name: Jeffrey D. Tranen
Title: Chairman Title: President
CENTRAL GULF LINES, INC.
s/ Niels W. Johnsen
By: __________________________
Name: Niels W. Johnsen
Title: Chairman