EXHIBIT 10.10
Capital Maritime & Trading Corp.
Iassonos 3
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Express Sea Transport Corporation
Iassonos 3
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June 10, 2005
Ladies and Gentlemen:
This Letter Agreement (this "Letter Agreement") between
Capital Maritime & Trading Corp. (the "Company"), a ▇▇▇▇▇▇▇▇ Islands
corporation, and Express Sea Transport Corporation ("ESTC" and, together, the
"Parties"), a Panamanian corporation sets forth the terms of the Letter
Agreement referenced in the Company's Registration Statement on Form F-1, to be
filed with the Securities and Exchange Commission, on June 13, 2005. The
Parties, by this Letter Agreement, hereby agree as follows:
1. The Company has the option to require ESTC to participate in a good
faith, exclusive negotiation for the sale of ESTC to the Company at
a price calculated by reference to the valuations submitted by three
independent, third party appraisers (the "Option"), appointed as
described in paragraph five, below.
2. ESTC agrees to participate in good faith in any negotiations
initiated by the Company pursuant to the Option.
3. The Company shall have the right to exercise the Option within the
one year period commencing on the first anniversary of the Initial
Public Offering of shares in the Company, by delivery of a written
notice to ESTC, provided however, that the duration of the right to
exercise the Option may be extended beyond the initial one year
period, if the Parties so agree in writing, specifying the term of
such extended duration.
4. ESTC agrees that, for so long as this Letter Agreement remains in
force, ESTC shall not enter into any agreement or other arrangement,
in each case whether
written or oral, for the acquisition of ESTC, or for the option to
negotiate the acquisition of ESTC, with any individual, corporate or
other entity, other than the Company.
5. Within 30 days of the exercise of the Option by the Company, the
Company and ESTC shall appoint three independent, third party
appraisers (the "Appraisers") each of whom shall be a shipbroker,
shipping consultant, other shipping professional, or financial
expert, in each case with recognized expertise in the shipping
industry, as follows: The first of the Appraisers shall be appointed
by the Company, by a majority vote of its independent directors. The
second of the Appraisers shall be appointed by ESTC. The third of
the Appraisers shall be appointed jointly by the Appraiser appointed
by the Company and the Appraiser appointed by ESTC.
6. Once appointed, each of the Appraisers shall submit to the Parties
an independent, written valuation report of the current fair market
value of ESTC, as an operating business, as of the date the Option
was exercised (the "Valuation"). In calculating the Valuation, the
Appraisers each shall:
a. take into account their own professional knowledge and
expertise of the ship chartering markets;
b. consider what is customary and reasonable (as of the
time of valuation) for businesses of a similar nature
and size;
c. consider the existence and range of potential
purchasers;
d. enumerate in the Valuation submitted to the Parties, all
other criteria considered in calculating the Valuation.
7. For purposes of calculating the Valuation, and upon written request
by any one, or all of the Appraisers, ESTC shall make available to
the Appraisers all reasonably requested financial and other
documents necessary to assist in the calculation of the Valuation,
provided however, that such documents shall only be provided
pursuant to a Confidentiality Agreement, signed by ESTC and by the
Appraisers seeking to review the documents. The Confidentiality
Agreement shall take the form set forth in Exhibit A hereto.
8. The Company shall pay all reasonable expenses associated with the
retention of the Appraisers and all reasonable costs associated with
the Appraisers' Valuations.
9. Following the submission to the Parties, by the Appraisers, of all
three independent Valuations, the Parties shall undertake a good
faith review and consideration of the range of Valuations submitted.
10. If the Parties, having exercised a good faith review of the range of
Valuations submitted, accept the range of Valuations, then the
Parties shall enter into good faith negotiations with one another to
agree upon a final purchase price for ESTC.
11. If the Parties agree to a final purchase price for ESTC, the terms
and conditions of the sale of ESTC to the Company shall be
consistent with reasonable and customary terms for a transaction of
this type, and shall be set forth in a Sales and Purchase Agreement
entered into between ESTC and the Company, and not inconsistent with
the terms of this Letter Agreement.
12. Each of the Parties hereby represents and warrants to the other
party that it has taken all corporate action necessary for the
authorisation, execution, and delivery of this Letter Agreement and
the performance of its obligations hereunder, and that this Letter
Agreement, when executed and delivered by such party, will
constitute its valid and legally binding obligation, enforceable in
accordance with its terms.
Sincerely,
CAPITAL MARITIME & TRADING CORP.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Chief Financial Officer
Agreed and accepted,
this 10th day of June, 2005
EXPRESS SEA TRANSPORT CORPORATION
By: /s/ Payiotis Vrettas
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Name: Payiotis Vrettas
Title: Sole Director
EXHIBIT A TO LETTER AGREEMENT DATED [] 2005, BETWEEN EXPRESS SEA TRANSPORT
CORPORATION AND CAPITAL MARITIME & TRADING CORP.
CONFIDENTIALITY AGREEMENT
[], 2005
This Confidentiality Agreement is hereby entered into by, and
immediately upon execution shall be binding upon, Express Sea Transport
Corporation, a [] corporation ("ESTC"), and each of the undersigned Appraisers
appointed pursuant to the Letter Agreement dated [] 2005, between Express Sea
Transport Corporation and Capital Maritime & Trading Corp. (the "Recipient
Appraisers" or individually, a "Recipient Appraiser").
ESTC agrees to make available to the Recipient Appraisers
certain information for the purpose of calculating the fair market value of
ESTC, as required in the Letter Agreement described in paragraph 1, above (the
"Letter Agreement"). Therefore, ESTC and Recipient Appraisers agree as follows:
1. All information pertaining to ESTC, including, without
limitation, technical, commercial, financial, accounting, legal and
administrative information, that has been or will be furnished to Recipient
Appraisers, in any format, in writing or orally, by ESTC, as well as all
analyses, compilations, forecasts, studies or other documents prepared by
Recipient Appraisers which contain or reflect any of such information, shall be
deemed "Confidential Information." ESTC shall prominently designate all
documents containing Confidential Information, and provided to Recipient
Appraisers, with the following, clearly legible legend: "CONFIDENTIAL
INFORMATION".
2. The term "Confidential Information" shall not include
information which: (a) is now or hereafter comes into the public domain other
than as a result of a breach of this Agreement by Recipient Appraisers; (b) is
lawfully in Recipient Appraiser's possession prior to the receipt of any
information from ESTC; (c) is disclosed to Recipient Appraisers on a
non-confidential basis by a third party, such fact to be established by the
Recipient Appraisers; (d) is independently developed by Recipient Appraisers
without any breach of this Confidentiality Agreement; or (e) is the subject of a
written permission to disclose provided by ESTC.
3. Recipient Appraisers shall keep confidential all
Confidential Information and shall not disclose any Confidential Information to
any third person, except as may be required by law, regulation, legal or
judicial process. Recipient Appraisers may use Confidential Information only to
the extent required to accomplish the purposes described in the Letter
Agreement. All Confidential Information (including all copies thereof) shall
remain the property of ESTC. The term "person" as used in this
Confidentiality Agreement shall be broadly interpreted to include, without
limitation, the media and any corporation, company, group, partnership,
individual or other entity.
4. At any time upon request by ESTC, Recipient Appraisers
shall return all written Confidential Information that was furnished to
Recipient Appraisers by ESTC and, unless otherwise required by law or
regulation, Recipient Appraisers shall destroy all analyses, compilations,
forecasts, studies or other documents prepared by Recipient Appraisers that
contain or reflect any of such information.
5. This Confidentiality Agreement and all rights and
obligations hereunder shall expire and cease to have any force or effect on the
second anniversary of the date hereof.
6. This Agreement shall be construed in accordance with
and governed in all respects by the law of the State of Delaware.
7. This Agreement contains the final, complete and
exclusive agreement of the parties relative to the subject matters hereof and
supersedes all prior and contemporaneous understandings and agreements relating
to its subject matter. This Confidentiality Agreement may not be changed,
modified, amended or supplemented except by a written instrument signed by all
parties.
8. This Confidentiality Agreement may be executed in
counterparts, each of which shall constitute an original and all of which, when
taken together, shall constitute one and the same instrument.
9. If the foregoing is acceptable to you, please
countersign this Agreement in the space provided below and return a fully
executed copy hereof to ESTC. Upon such countersignature, this Agreement shall
take effect as of the date first above written.
EXPRESS SEA TRANSPORT CORPORATION
By: ____________________________
Authorized Signatory
Accepted and Agreed:
First Appraiser
Name: ____________________________
Signature: ____________________________
Second Appraiser
Name: ____________________________
Signature: ____________________________
Third Appraiser
Name: ____________________________
Signature: ____________________________