EXHIBIT 10.2
PORTIONS OF THIS DOCUMENT HAVE BEEN OMITTED PURSUANT TO AN APPLICATION FOR AN
ORDER FOR CONFIDENTIAL TREATMENT REQUESTED BY COMMODORE HOLDINGS LIMITED
----------------------------------------------------------- --------------------------------------------------------
1. Shipbroker THE BALTIC AND INTERNATIONAL
MARITIME COUNCIL (BIMCO)
Paxships Ltd. STANDARD BAREBOAT CHARTER
CODE NAME: "BARECON 89'
PART I
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2. Place and date
Miami, March 9, 1998
----------------------------------------------------------- --------------------------------------------------------
3. Owners/Place of business 4. Bareboat charterers (Charterers)/Place of business
Cruise Charter Ltd. Commodore Cruises Limited
c/o Bostwick & ▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇-S
▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ South Tower
P. O. Box "N" 1605 Hollywood, Florida 33021
Nassau, Bahamas
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5. ▇▇▇▇▇▇'s name, Call Sign and Flag (Cl. 9(c))
M/V Island Holiday, __________ Ukranian (being changed to Bahamian)
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6. Type of Vessel 7. GRT/NRT
Passenger 15,410/6401
----------------------------------------------------------- --------------------------------------------------------
8. When/Where built 9. Total DWT (abt.) in metric tons on summer freeboard
2250
1975 Finland
----------------------------------------------------------- --------------------------------------------------------
10. Class 11. Date of last special survey by the Vessel's
classification society
KM (*)A3(2)
April 1996
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12. Further particulars of Vessel (also indicate minimum number of month's
validity of class certificates agreed acc. To Cl.14)
Length 140.42 m. Breadth 21.83 m. Depth 16.30 m
Main Engines: Diesel 2 x 6620 Kw
Minimum Three Months Validity of Class Certificate
----------------------------------------------------------- --------------------------- ----------------------------
13. Port or Place of delivery (Cl. 2) 14. Time for delivery 15. Canceling date
(Cl. 3) (Cl. 4)
Freeport, Grand Bahama
May 1, 1998 May 8, 1998
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16. Port or Place or redelivery (Cl. 14)
Freeport, Grand Bahama
----------------------------------------------------------- --------------------------------------------------------
----------------------------------------------------------- --------------------------------------------------------
17. Running days' notice if other than stated in Cl. 3 18. Frequency of dry-docking if other than stated in
C. 9(f)
Drydock and/or classification repair every 12
months or as necessary to keep in Class
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19. Trading Limits (Cl. 5)
Lawful Trades Worldwide. Vessel not to compete with SeaEscape in New
York or Port Everglades as gaming vessel. See Clause 58 of Addendum.
----------------------------------------------------------- --------------------------------------------------------
20. Charter period 21. Charter hire (Cl. 10)
56 months with rights of first offer as per Clause $ [*] per day, as per Cl. 63 of Addendum
43 of Addendum
----------------------------------------------------------- --------------------------------------------------------
22. Rate of interest payable acc. to C.10(f) and, if 23. Currency and method of payment (Cl. 10)
applicable, acc. to PART IV
U.S. dollars
15% per annum
----------------------------------------------------------- --------------------------------------------------------
24. Place of payment, also state beneficiary and bank 25. Bank guarantee/bond (sum and place) (optional)
account (Cl. 10)
Address of Owner in Box 3, or as agreed NONE
----------------------------------------------------------- --------------------------------------------------------
26. Mortgage(s), if any (Cl. 11) 27. Insurance (marine and war risks)
None As per Clause 53 of Addendum
----------------------------------------------------------- --------------------------------------------------------
28. Additional insurance cover, if any, for 29. Additional insurance cover, if any, for
Owners' account limited to (C1. 12(b)) or, if Charterers' account limited to (C1. 12(b)) or,
applicable, (C1. 13(g)) if applicable, (C1. 13(g))
None See Clause 53 of Addendum
----------------------------------------------------------- --------------------------------------------------------
30. Latent defects (only to be filled in if 31. War cancellation (indicate countries
period other than stated in C1. 2) agreed) (C1. 24)
See Clause 44 of Addendum
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32. Brokerage commission and to whom payable (Cl. 25)
100,000 shares of common stock of Commodore Holdings
Limited, to Paxships Ltd.
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* MARKED TEXT OMITTED PURSUANT TO AN APPLICATION FOR AN ORDER FOR CONFIDENTIAL
TREATMENT BY COMMODORE HOLDINGS LIMITED
2
----------------------------------------------------------- --------------------------------------------------------
33. Law and arbitration 34. Number of additional clauses
covering special provisions, if agreed
See Clause 79 of Addendum See Addendum
----------------------------------------------------------- --------------------------------------------------------
35. Newbuilding Vessel (indicate with "yes" 36. Name and place of Builders (only to be
or "no" filled in whether Part III applies) (OPTIONAL) filed in if Part III applies)
N/A N/A
----------------------------------------------------------- --------------------------------------------------------
37. Vessel's Yard Building No. (only to be filled in 38. Date of Building Contract (only to be filled in
Part III applies) if Part III applies)
N/A N/A
----------------------------------------------------------- --------------------------------------------------------
39. Hire/Purchase agreement (indicate with "yes" or "no" 40. Bareboat Charter Registry (indicate with
whether Part IV applies) (OPTIONAL) "yes" or "no" whether Part V applies) (OPTIONAL)
N/A N/A
----------------------------------------------------------- --------------------------------------------------------
41. Flag and Country of the Bareboat Charter Registry 42. Country of the Underlying Registry (only to be
(only to be filled in if Part V applies) filled in if Part V applies)
N/A N/A
----------------------------------------------------------- --------------------------------------------------------
3
PREAMBLE - It is mutually agreed that this Contract shall be performed subject
to the conditions contained in this Charter which shall include PART I and PART
II, in the event of a conflict of conditions, the provisions of PART I shall
prevail over those of PART II to the extent of such conflict but no further. It
is further mutually agreed that PART III and/or PART IV and/or PART V shall only
apply and shall only form part of this Charter if expressly agreed and stated in
the Boxes 35, 39, 40. If PART III and/or PART IV and/or PART V apply, it is
further mutually agreed that in the event of a conflict of conditions, the
provisions of PART I and PART II shall prevail over those of PART III and/or
PART IV and/or PART V to the extent of such conflict but no further.
Signature (Owners) Signature (Charterers)
CRUISE CHARTER, LTD., a Bahamian COMMODORE CRUISES LIMITED, a
corporation Bermudan corporation
By: /S/ ▇▇▇▇▇▇▇ ▇▇▇▇▇ By: /S/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
--------------------------- --------------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇, President ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, President
4
ISLAND HOLIDAY CHARTER
PART II AND ADDENDUM
PART II
1. DEFINITIONS. In this Charter, the following terms shall have the meanings
thereby assigned to them:
"THE OWNERS" shall mean the person or company which has this Vessel
under sub-bareboat charter (the "First Sub-Charter") from Silvercone Holdings
Limited ("Silvercone"), a Cypriot corporation, a copy of which is appended as
Exhibit "A." Silvercone has consented to this charter and has executed a
non-disturbance agreement appended hereto as Exhibit "B."
"The Charterers" shall mean the Bareboat charterers and shall not be
construed to mean a time charterer or a voyage charterer.
2. DELIVERY (not applicable to new building vessels.) The Vessel shall be
delivered and taken over by the Charterers at the port or place indicated in Box
13, in such ready berth as the Charterers may direct.
The Owners shall before and at the time of delivery exercise due
diligence to make the Vessel seaworthy and in every respect ready in hull,
machinery and equipment for service under this Charter. The Vessel shall be
properly documented at time of delivery.
The delivery to the Charterers of the Vessel and the taking over of the
Vessel by the Charterers shall constitute a full performance by the Owners of
all the Owners' obligations under Clause 2, and thereafter the Charterers shall
not be entitled to make or assert any claim against the Owners on account of any
conditions, representations or warranties expressed or implied with respect to
the Vessel but the Owners shall be responsible for repairs or renewals
occasioned by latent defects in the Vessel, her machinery or appurtenances,
existing at the time of delivery under the Charter, provided such defects have
manifested themselves within 18 months after delivery unless otherwise provided
in Box 30.
3. TIME FOR DELIVERY (not applicable to new building vessels). The Vessel to be
delivered not before the date indicated in Box 14 unless with the Charterers'
consent. Delivery to take place after inspection and completion of Condition
Report.
Unless otherwise agreed in Box 17, the Owners to give the Charterers
not less than 30 running days' preliminary and not less than 14 days' definite
notice of the date on which the Vessel is expected to be ready for delivery.
The Owners to keep the Charterers closely advised of possible changes
in the Vessel's position.
4. CANCELING (not applicable to new building vessels). Should the Vessel not be
delivered latest by the canceling date indicated in Box 15, the Charterers to
have the option of canceling this Charter without prejudice to any claim the
Charterers may otherwise have on the Owners under the Charter.
If it appears that the Vessel will be delayed beyond the canceling
date, the Owners shall, as soon as they are in a position to state with
reasonable certainty the day on which the Vessel should be ready, give notice
thereof to the Charterers asking whether they will exercise their option of
canceling, and the option must then be declared within one hundred and
sixty-eight (168) hours of the receipt by the Charterers of such notice. If the
Charterers do not then exercise their option of canceling, the seventh day after
the readiness date stated in the Owners' notice shall be regarded as a new
canceling date for the purpose of this Clause.
5. TRADING LIMITS. The Vessel shall be employed in lawful trades for the
carriage of suitable lawful merchandise within the trading limits indicated in
Box 19.
The Charterers undertake not to employ the Vessel or suffer the Vessel
to be employed otherwise than in conformity with the terms of the instruments of
insurance (including any warranties expressed or implied therein) without first
obtaining the consent to such employment of the insurers and complying with such
requirements as to extra premium or otherwise as the insurers may prescribe. If
required, the Charterers shall keep the Owners and the Mortgagees advised of the
intended employment of the Vessel.
The Charterers also undertake not to employ the Vessel or suffer her
employment in any trade or business which is forbidden by the law of any country
to which the Vessel may sail or is otherwise illicit or in carrying illicit or
prohibited goods or in any manner whatsoever which may render her liable to
condemnation, destruction, seizure or confiscation.
Notwithstanding any other provisions contained in this Charter it is
agreed that nuclear fuels or radioactive products or waste are specifically
excluded from the cargo permitted to be loaded or carried under this Charter.
This exclusion does not apply to radio-isotopes used or intended to be used for
any industrial, commercial, agricultural, medical or scientific purposes
provided the Owners prior approval has been obtained to loading thereof.
2
6. SURVEYS (not applicable to new building vessels). Survey on Delivery and
Redelivery. - The Owners and Charterers shall each appoint surveyors for the
purpose of determining and agreeing in writing the condition of the Vessel at
the time of delivery and redelivery hereunder. The Owners shall bear all
expenses of the On-Survey including loss of time, if any, and the Charterers
shall bear all expenses of the Off-Survey including loss of time, if any, at the
rate of hire per day or pro rata, also including in each case the cost of any
docking and undocking, if required, in connection herewith.
7. INSPECTION. Inspection. - The Owners shall have the right at any time to
inspect or survey the Vessel or instruct a duly authorized surveyor to carry out
such survey on their behalf to ascertain the condition of the Vessel and satisfy
themselves that the Vessel is being properly repaired and maintained. Inspection
or survey in drydock shall be made only when the Vessel shall be in drydock for
the Charterers' purpose. However, the owners shall have the right to require the
Vessel to be drydocked for inspection if the Charterers are not docking her at
normal classification intervals. The fees for such inspection or survey shall,
in the event of the Vessel being found to be in the condition provided in Clause
9 of this Charter, be payable by the Owners and shall be paid by the Charterers
only in the event of the Vessel being found to require repairs or maintenance in
order to achieve the condition so provided. All time taken in respect of
inspection, survey or repairs shall count as time on hire and shall form part of
the Charter period.
The Charterers shall also permit the Owners to inspect the Vessel's log
books whenever requested and shall, whenever required by the Owners, furnish
them with full information regarding any casualties or other accidents or damage
to the Vessel. For the purpose of this Clause, the Charterers shall keep the
Owner advised of the intended employment of the Vessel.
8. INVENTORIES AND CONSUMABLE OIL AND STORES. A complete inventory of ▇▇▇▇▇▇'s
entire equipment, outfit, appliances and of all consumable stores on board the
Vessel shall be made by the Charterers in conjunction with the Owners on
delivery and again on redelivery of the Vessel. The Charterers and the Owners,
respectively, shall at the time of delivery and redelivery take over and pay for
all bunkers, lubricating oil, water and unbroached provisions, paints, oils,
ropes and other consumable stores in the said Vessel at the then current market
prices at the ports of delivery and redelivery, respectively.
9. MAINTENANCE AND OPERATION.
(a) The Vessel shall, during the Charter period, be in the full
possession and at the absolute disposal for all purposes of the Charterers and
under their complete control in every respect. The Charterers shall maintain the
Vessel, her machinery, boilers, appurtenances and spare parts in a good state of
repair, in efficient operation condition, and in accordance with good commercial
maintenance practice, wear and tear always excepted and, except as provided for
in Clause 13(1), they shall keep the Vessel with unexpired classification of the
3
class indicated in Box 10 (or such other class as may be assigned to the Vessel
by any subsequent classification society) and with other required certificates
in force at all times.
The Charterers to take immediate steps to have material, necessary
repairs done within a reasonable time failing which, after written notice and a
reasonable opportunity to cure, the Owners shall have the right of withdrawing
the Vessel from the service of the Charterers without noting any protest and
without prejudice to any claim the Owners may otherwise have against the
Charterers under the Charter.
Unless otherwise agreed, in the event of any improvement, structural
changes, or expensive new equipment becoming necessary for the continued
operation of the Vessel by reason of the Vessel's marine insurance value as
stated in Box 27, then the extent, if any, to which the rate of hire shall be
varied and the ratio in which the cost of compliance shall be shared between the
parties concerned in order to achieve a reasonable distribution thereof as
between the Owners and the Charterers having regard, inter ail, to the length of
the period remaining under the Charter, shall in the absence of agreement, be
referred to arbitration according to Clause 79.
The Charterers are required to establish and maintain financial
security or responsibility in respect of oil or other pollution damage as
required by any government, including federal, state or municipal or other
division or authority thereof, to enable the Vessel, without penalty or charge,
lawfully to enter, remain at, or leave any port, place, territorial or
contiguous waters of any country, state or municipality in performance of this
Charter without any delay. This obligation shall apply whether or not such
requirements have been lawfully imposed by such government or division or
authority thereof. The Charterers shall make and maintain all arrangements by
bond or otherwise as may be necessary to satisfy such requirements at the
Charterers' sole expense and the Charterers shall indemnify the Owners against
all consequences whatsoever (including loss of time) for any failure or
inability to do so.
TOVALOP SCHEME. (Applicable to oil tank vessels only). - The Charterers
are required to enter the Vessel under the TOVALOP SCHEME or under any similar
compulsory scheme upon delivery under this Charter and to maintain her so during
the currency of this Charter.
(b) The Charterers shall at their own expense and by their own
procurement man, navigate, operate, supply, fuel and repair the Vessel whenever
required during the Charter period and they shall pay all charges and expenses
of every kind and nature whatsoever incidental to their use and operation of the
Vessel under this Charter, including any foreign general municipality and/or
state taxes. The Master, officers and crew of the Vessel shall be the servants
of the Charterers for all purposes whatsoever, even if for any reason appointed
by the Owners, Charterers shall comply with the regulations regarding officers
and crew in force in the country of the Vessel's flag or any other applicable
law.
(c) During the currency of this Charter, the Vessel shall retain her
present name as indicated in Box D and shall remain under and fly the flag as
indicated in Box 5 (or the flag of
4
the Bahamas). Provided, however, that the Charterers shall have the liberty to
paint the Vessel in their own colors, install and display their funnel insignia
and fly their own house flag. Painting and re-painting, installment and
re-installment to be for the Charterers account and time used thereby to count
as time on hire.
(d) The Charterers shall make no structural changes in the Vessel or
changes in the machinery, boilers, appurtenances or spare parts thereof without
in each instance first securing the Owners' approval thereof. If the Owners so
agree, the Charterers shall, if the Owners so require, restore the Vessel to its
former condition before the termination of the Charter.
(e) The Charterers shall have the use of all outfit equipment and
appliances on-board the Vessel at the time of delivery, provided the same or
their substantial equivalent shall be returned to the Owners on redelivery in
the same good order and condition as when received, ordinary wear and tear
excepted. The Charterers shall from time to time during the Charter period
replace such items of equipment as shall be so damaged or worn as to be unfit
for use. The Charterers are to procure that all repairs to or replacement of any
damaged, worn or lost parts or equipment be effected in such manner (both as
regards workmanship and quality of materials) as not to diminish the value of
the Vessel. The Charterers have the right to fit additional equipment at their
expense and risk but the Charterers shall remove such equipment at the end of
the period if requested by the Owners.
Any equipment including radio equipment on hire on the Vessel at time
of delivery shall be kept and maintained by the Charterers and the Charterers
shall assume the obligations and liabilities of the Owners under any lease
contracts in connection therewith and shall reimburse the Owners for all
expenses incurred in connection therewith, also for any new equipment required
in order to comply with radio regulations.
(f) The Charterers shall drydock the Vessel and clean and paint her
underwater parts whenever the same may be necessary, but not less than once in
every eighteen calendar months after delivery unless otherwise agreed in Box 18.
10. HIRE.
(a) The Charterers shall pay to the Owners for the hire of the Vessel
at the lump sum per calendar month as indicated in Box 21 commencing on and from
the date and hour of her delivery to the Charterers and at and after the agreed
lump sum for any part of the month. Hire to continue until the date and hour
when the Vessel is redelivered by the Charterers to her Owners.
5
(b) Payment of Hire, except for the first and last month's Hire, if
subclass (c) of this Clause is applicable, shall be made in cash without
discount in the currency and in the manner indicated in Box 23 and at the place
mentioned in Box 24.
(c) Payment of Hire for the first and last month's Hire if less than a
full month shall be calculated proportionally according to the number of days in
the particular calendar month and advance payment to be effected accordingly.
(d) Should the Vessel be lost or missing, Hire to cease from the date
and time when she was lost or last heard of. Any Hire paid in advance to be
adjusted accordingly.
(e) Time shall be of the essence in relation to payment of Hire
hereunder. In default of payment beyond a period of ten running days after
notice is delivered to Charterer, the Owners shall have the right to withdraw
the Vessel from the service of the Charterers without noting any protest and
without interference by any court or any other formality whatsoever and shall
without prejudice to any other claim the Owners may otherwise have against the
Charterers under the Charter, be entitled to damages in respect of all costs and
losses incurred as a result of the Charterers' default and the ensuing
withdrawal of the Vessel.
(f) Any delay in payment of Hire shall entitle the Owners to an
interest at the rate per annum as agreed in Box 22. If Box 22 has not been
filled in the current market rate in the country where the Owners have their
Principal Place of Business shall apply.
11. MORTGAGE.
(a) Owners warrant that they have not effected any mortgage of the
Vessel.
(b) Deleted.
(c) Deleted.
12. INSURANCE AND REPAIRS.
(a) During the Charter period the Vessel shall be kept insured by the
Charterers at their expense against marine, war and Protection, and Indemnity
risks in such form as the Owners shall in writing approve, which approval shall
not be unreasonably withheld. Such marine, war and P. and I. Insurances shall be
arranged by the Charterers to protect the interests of both the Owners and the
Charterers and mortgagees (if any), and the Charterers shall be at liberty to
protect under such insurances the interests of any managers they may appoint.
All insurance policies shall be in the joint names of the Owners and the
Charterers as their interests may appear.
If the Charterers fail to arrange and keep any of the insurances
provided for under the provisions of sub-clause (a) above in the manner
described therein, the Owners shall notify
6
the Charterers whereupon the Charterers shall rectify the position within seven
running days, failing which Owners shall have the right to withdraw the Vessel
from the service of the Charterers without prejudice to any claim the Owners
may otherwise have against the Charterers.
The Charterers shall, subject to the approval of the Owners and the
Underwriters, effect all insured repairs and shall undertake settlement of all
costs in connection with such repairs as well as insured charges, expenses and
liabilities (reimbursement to be secured by the Charterers from the
Underwriters) to the extent of coverage under the insurances herein provided
for.
The Charterers are also to remain responsible for and to effect repairs
and settlement of costs and expenses and expenses incurred thereby in respect of
all other repairs not covered by the insurances and/or not exceeding any
possible franchise(s) or deductibles provided for in the insurances.
All time used for repairs under the provisions of sub-clause (a) of
this Clause and for repairs of latent defects according to Clause 2 above
including any deviation shall count as time on hire and shall form part of the
Charter period.
(b) If the conditions of the above insurances permit additional
insurance to be placed by the parties, such cover shall be limited to the amount
for each party set out in Box 28 and Box 29, respectively. The Owners or the
Charterers, as the case may be, shall immediately furnish the other party with
particulars of any additional insurance effected, including copies of any cover
notes or policies and the written consent of the insurers of any such required
insurance in any case where the consent of such insurers is necessary.
(c) Should the Vessel become an actual, constructive, compromised or
agreed total loss under the insurances required under sub-clause (a) of Clause
12, all insurance payments for such loss shall be paid to the Mortgagee, if any,
in the manner described in the Deed(s) of Covenant, who shall distribute the
moneys between themselves, the Owners and the Charterers according to their
respective interests. The Charterers undertake to notify the Owners and the
Mortgagee, if any, of any occurrences in consequence of which the Vessel is
likely to become a Total Loss as defined in this Clause.
(d) If the Vessel becomes an actual, constructive, compromised or
agreed total loss under the insurances arranged by the Charterers in accordance
with sub-clause (a) of this Clause, this Charter shall terminate as of the date
of such loss.
(e) The Owners shall upon the request of the Charterers, promptly
execute such documents as may be required to enable the Charterers to abandon
the Vessel to insurers and claim a constructive total loss.
7
(f) For the purpose of insurance coverage against marine and war risks
under the provisions of sub-clause (a) of this Clause, the value of the Vessel
is the sum indicated in Box 27.
13. Deleted
14. REDELIVERY. The Charterers shall at the expiration of the Charter period
Redeliver the Vessel at a safe and ice-free port or place as indicated in Box
16. The Charterers shall give the Owners not less than 30 running days'
preliminary and not less than 14 days' definite notice of expected date, range
of ports of redelivery or port or place of redelivery. Any changes thereafter in
▇▇▇▇▇▇'s position shall be notified immediately to the Owners.
Should the vessel be ordered on a voyage by which the Charter period
may be exceeded the Charterers to have the use of the Vessel to enable them to
complete the voyage, provided it could be reasonably calculated that the voyage
would allow redelivery about the time fixed for the termination of the Charter.
The Vessel shall be redelivered to the Owners in the same or as good
structure, state, condition and class as that in which she was delivered, fair
wear and tear not affecting class excepted.
The Vessel upon redelivery shall have her survey cycles up to date and
class certificates valid for at least the number of months agreed in Box 12.
15. NON-LIEN AND INDEMNITY. The Charterers will not suffer, nor permit to be
continued, any lien or encumbrance incurred by them or their agents, which might
have priority over the title and interest of the Owners in the Vessel.
The Charterers further agree to fasten to the Vessel in a conspicuous
place and to keep so fastened during the Charter period a notice reading as
follows:
"This Vessel is the property of (name of Owners). It is under charter
to (name of Charterers) and by the terms of the Charter Party neither the
charterers nor the Master have any right, power or authority to create, incur or
permit to be imposed on the Vessel any lien whatsoever."
The Charterers shall indemnify and hold the Owners harmless against any
lien of whatsoever nature arising upon the Vessel during the Charter period
while she is under the control of the Charterers, and against any claims against
the Owners arising out of or in relation to the operation of the Vessel by the
Charterers. Should the Vessel be arrested by reason of claims or liens arising
out of her operation hereunder by the Charterers, the Charterers shall at their
own expense take all reasonable steps to secure that within a
8
reasonable time the Vessel is released and at their own expense put up bail to
secure release of the Vessel.
16. LIEN. The Owners to have a lien upon all cargoes and sub-freights belonging
to the Charterers and any Bill of Lading freight for all claims under this
Charter, and the Charterers to have a lien on the Vessel for all moneys paid in
advance and not earned, and for any breach of Charter by Owners.
17. SALVAGE. All salvage and towage performed by the Vessel shall be for the
Charterers' benefit and the cost of repairing damage occasioned thereby shall be
borne by the Charterers.
18. WRECK REMOVAL. In the event of the Vessel becoming a wreck or obstruction to
navigation the charterers shall indemnify the Owners against any sums whatsoever
which the Owners shall become Liable to pay and shall pay in consequence of the
Vessel becoming a wreck or obstruction to navigation.
19. GENERAL AVERAGE. General Average, if any, shall be adjusted according to the
York-Antwerp Rules 1974 or any subsequent modification thereof current at the
time of the casualty.
The Charter Hire not to contribute to General Average.
20. ASSIGNMENT AND SUB DEMISE. The Charterers shall not assign this Charter nor
subdemise the Vessel except to an affiliate or with the prior consent in writing
of the Owners which shall not be unreasonably withheld and subject to such terms
and conditions as the Owners shall approve.
21. BILLS OF LADING. The Charterers are to procure that all Bills of Lading
issued for carriage of goods under this Charter shall contain a Paramount Clause
incorporating any legislation relating to Carrier's liability for cargo
compulsorily applicable in the trade; if no such legislation exists, the Bills
of Lading shall incorporate the U.S. Carriage of Goods by Sea Act. The Bills of
Lading shall also contain the amended New ▇▇▇▇▇ ▇▇▇▇▇▇ and the Both-to-Blame
Collision Clause.
22. BANK GUARANTEE. The Charterers undertake to furnish, before delivery of the
Vessel, a first class bank guarantee or bond in the sum and at the place as
indicated in Box 25 as guarantee for full performance of their obligations under
this Charter. (Optional, only to apply if Box 25 filled in).
9
23. REQUISITION/ACQUISITION.
(a) In the event of the Requisition for Hire of the Vessel by any
governmental or other competent authority (hereinafter referred to as
"Requisition for Hire"), irrespective of the date during the Charter period when
"Requisition for Hire" may occur and irrespective of the length thereof and
whether or not it be for an indefinite or a limited period of time and
irrespective of whether it may or will remain in force for the remainder of the
Charter period, the Charterers shall have the option to terminate the Charter or
to continue to pay the stipulated hire in the manner provided by this Charter
until the time when the Charter would have terminated pursuant to any of the
provisions hereof, provided that the requisition continues for four
uninterrupted weeks, and always provided however that in the event of
"Requisition for Hire" any "Requisition Hire" or compensation received or
receivable by the Owners shall be payable to the Charterers during the remainder
of the Charter period or the period of the "Requisition for Hire," whichever be
the shorter.
The Hire under this Charter shall be payable to the Owners from the
same time as the Requisition Hire is payable to the Charterers.
(b) In the event of the Owners being deprived of their ownership in the
Vessel by any Compulsory Acquisition of the Vessel or requisition for title by
any governmental or other competent authority (hereinafter referred to as
"Compulsory Acquisition"), then, irrespective of the date during the Charter
Period when "Compulsory Acquisition" may occur, this Charter shall be deemed
terminated as of the date of such Compulsory Acquisition. In such event Charter
Hire to be considered as earned and to be paid up to the date and time of such
"Compulsory Acquisition."
24. WAR.
(a) The Vessel unless the consent of the Owners be first obtained not
to be ordered nor continue to any place or on any voyage, nor be used on any
service which will bring her within a zone which is dangerous as the result of
any actual or threatened act of war, hostilities, warlike operations, acts of
piracy or of hostility or malicious damage against this or any other vessel or
its cargo by any person, body or State whatsoever, revolution, civil war, civil
commotion or the operation of the international law, nor be exposed in any way
to any risks or penalties whatsoever consequent upon the imposition of
Sanctions, nor carry any goods that may in any way expose her to any risks of
seizure, capture, penalties or any other interference of any kind whatsoever by
the belligerent or fighting powers or parties or by any Government or Ruler.
10
(b) The Vessel to have liberty to comply with any orders or directions
as to departure, arrival, routes, ports of call, stoppages, destination,
delivery or in any other wise whatsoever given by the Government of the nation
under whose flag the Vessel sails or any other Government or any person (or
body) acting or purporting to act with the authority of such Government or by
any committee or person having under the terms of the war risks insurance on the
Vessel the right to give any such orders or directions.
(c) In the event of outbreak of war (whether there be a declaration of
war or not) between any two or more of the countries as stated in Box 31, both
the Owners and the Charterers shall have the right to cancel this Charter,
whereupon the Charterers shall redeliver the Vessel to the Owners in accordance
with Clause 14, if she has cargo on board after discharge thereof at
destination, or if debarred under this Clause from reaching or entering it at a
near open and safe port as directed by the Owners, or if she has no cargo on
board, at the port at which she then is or if at sea at a near open and safe
port as directed by the Owners. In all cases hire shall continue to be paid in
accordance with Clause 10 except as aforesaid all other provisions of this
charter shall apply until redelivery.
25. COMMISSION. The Charterer to pay the commission indicated in Box 32 to the
Brokers named in Box 32. The commission shall be fully earned and payable on
delivery of the Vessel.
Should the parties agree to cancel the Charter, the Owners to indemnify the
Brokers against any loss of commission but in such case the commission not to
exceed the brokerage on one year's hire.
CHARTERERS: OWNER:
COMMODORE CRUISES LIMITED, CRUISE CHARTER, LTD., a
a Bermudan corporation Bahamian corporation
By: /S/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ By: /S/ ▇▇▇▇▇▇▇ ▇▇▇▇▇
------------------------------- ----------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Chairman ▇▇▇▇▇▇▇ ▇▇▇▇▇, President
11
ADDENDUM TO BARECON '89
BAREBOAT CHARTER DATED MARCH 9, 1998
BETWEEN CRUISE CHARTER, LTD.,
A BAHAMIAN CORPORATION, AS "OWNER,"
AND, COMMODORE CRUISES LIMITED,
A BERMUDAN CORPORATION
AS "CHARTERER"
43. PERIOD/EXTENSIONS.
Subject to the right of termination as is hereinafter set forth and
further subject to the terms and conditions as are provided herein, the Owner
shall let and the Charterer shall hire the Vessel for a period of (56) months
from delivery (the "Initial Period"). Subsequent to the Initial Period, the
Charterer shall have a right of first offer with respect to extending this
Charter for three (3) additional periods of twenty-four (24) months each (the
"Subsequent Periods"). Accordingly, should the Charterer desire to exercise its
right of first offer relative to the subsequent Periods, it shall, within six
(6) months prior to the expiration of the Initial Period and within (6) months
prior to the expiration of any Subsequent Period, notify the Owner of
▇▇▇▇▇▇▇▇▇'s intention to exercise its right of first offer and shall,
simultaneously with such notice, prepare a written proposal for the then pending
Subsequent Period. Should said offer not be accepted by the Owner, then the
parties shall be obligated to negotiate in good faith and if, within thirty (30)
days following the date of the notice, no agreement has been reached, no further
obligations to negotiate shall continue to exist and the Charter will expire
upon termination of the Initial Period or upon termination of any Subsequent
Period, as the case may be.
44. DELIVERY/SURVEY AND CONDITION ON DELIVERY.
(a) Owner shall deliver the Vessel to Charterer at 12 Noon on May 1,
1998 at Freeport, Grand Bahama, as agreed fully found and in class without
comments, in a condition in accordance with the Condition Report described
below, and in compliance with current SOLAS and USPH regulations. Subject to the
terms and conditions hereof, including without limitation the requirement that
the Vessel be delivered in class and without comments and in compliance with
current SOLAS regulations, Charterers will accept delivery of the Vessel on May
1, 1998, at Freeport, Grand Bahamas, and such delivery shall constitute full and
proper delivery to the Charterer under the Charter.
Should the Vessel be delivered in a condition not, in some material
aspect, in accordance with the Condition Report or in compliance with current
SOLAS or USPH regulations, then Charterer will have the option to reject the
Vessel or to make the repairs required for the Vessel to meet the conditions set
forth herein at Owner's expense.
(b) Prior to March 14, 1998, designated surveyors of the Owner and
Charterer shall jointly inspect the Vessel and prepare a written report
regarding the condition of the
12
▇▇▇▇▇▇ (the "Condition Report") for the mutual benefit of both parties.
Charterer will accept the Vessel in the state of repair and maintenance
described in the Condition Report. The Condition Report shall be a basis for
evaluating the condition of the Vessel upon its re-delivery and, therefore, at
the expiration of the Charter Period, the Vessel shall be redelivered in the
same condition as is set forth in the Condition Report, reasonable wear
excepted. The cost of the survey shall be for the account of the Owner and the
Charterer to the extent of 50% each. A copy of the Condition Report is appended
hereto and made a part hereof as Exhibit "C."
(c) After the survey of the Vessel and before delivery on May 1, 1998,
▇▇▇▇▇▇▇▇▇ shall execute a written inventory confirmation to which there shall be
attached a description of the personal property comprising the Vessel's
equipment, furniture, furnishings and gear and the Charterer shall be
responsible for the care, maintenance and replacement of such inventory during
the Charter Period and shall be further responsible to return the same inventory
to the Owner upon re-delivery of the vessel at the termination of the Charter.
(d) If the Owner has not delivered the Vessel at Freeport, Grand Bahama
on or before May 1, 1998, by reason of Owner's willful default, the Owner shall
pay to the Charterer the sum of [*] Dollars [*] per day for each day after May
1, 1998, that the Vessel has not been delivered as aforesaid. If the Vessel is
not delivered at Freeport, Grand Bahama on or before May 8, 1998, Charterer, at
its option, may elect to terminate this Bareboat Charter or seek either damages
for its losses and/or specific performance. Owner represents and warrants that
it has the full right and authority to deliver the Vessel as agreed.
45. MODIFICATIONS.
Charterer shall not make any structural alterations or modifications to
the Vessel, to her passenger and public spaces, to her furniture, furnishings,
passenger and other facilities and equipment without first securing approval of
the Owner. Any such alterations will be at the sole expense of the Charterer.
Owner shall not unreasonably refuse such modifications and alterations if:
(i) they do not affect classification requirements or the Vessel's
compliance with SOLAS, class or other regulations; and
(ii) they do not, in the opinion of the Owner, materially and adversely
affect the resale value or the marketability of the Vessel upon expiration of
the Charter period.
46. OWNER'S REPRESENTATIONS, WARRANTIES AND COVENANTS.
(a) STATUS OF FIRST SUB-CHARTER. Owner hereby acknowledges and agrees
that, as of the date hereof, (i) Owner has complied with all of the terms and
conditions of the First Sub-Charter, Silvercone Holdings Limited has no rights
to any credit, claim, cause of action, offset or similar charge against Owner,
Charterer or the Vessel; (ii) Owner has fully performed all of its obligations
under the First Sub-Charter to be performed prior to the date
* MARKED TEXT OMITTED PURSUANT TO AN APPLICATION FOR AN ORDER FOR CONFIDENTIAL
TREATMENT BY COMMODORE HOLDINGS LIMITED
13
hereof, and (iii) there are no assignees, time charters, space charters or
transferees of the First Sub-Charter, or any part thereof, or any person or firm
(other than Owner) occupying or having the right in the future to occupy the
Vessel, or any part thereof.
(b) The Owner represents and warrants and covenants to the Charterer as
follows:
i. That it is and will be the lawful Charterer of said ▇▇▇▇▇▇
and the equipment thereon during the term of this Charter, that it will warrant
and defend the title to the same against the lawful claims and demands of all
persons, and that the Vessel will be free of all liens and encumbrances as of
the date of delivery to Charterer. The casino equipment on board is leased by
Owner as Lessee; Charterers to have the option of continuing the lease or of
installing Charterer's equipment;
ii. That Owner shall indemnify and hold harmless the Charterer
from any damages Charterer may incur during the term of this Charter caused by a
breach of this Charter by Owner or caused by a breach of any agreement between
the Owner and any third party;
iii. That Owner will notify and obtain the consent of the
owner of the Vessel or any other person whose consent to this Charter is
required. Owner further agrees to make all charter payments on the Vessel in a
timely manner and promptly notify Charterer of any "monetary default" by Owner
in the monetary terms of any charter (or related loans) on the Vessel and allow
Charterer an opportunity to cure such "monetary default" and offset payments
from amounts due to Owner. The Owner shall indemnify and hold harmless the
Charterer from any damages Charterer may incur caused by a monetary default by
Owner in the payment of charter hire (or related loans) on the Vessel; and
iv. That Owner will comply with all laws applicable to the
Vessel during the term of this Charter.
In the event of a seizure of the Vessel during the term of this Charter
caused by a breach of this Charter by Owner or caused by a breach of any
agreement between the Owner and a third party, the Charterer shall have the
option of curing said breach and obtaining a release of the Vessel, in which
event any payments made by the Charterer to obtain a release of the Vessel from
seizure shall be credited toward any payments due the Owner pursuant to this
Charter. Nothing herein shall limit ▇▇▇▇▇▇▇▇▇'s rights or remedies against Owner
as a result of any seizure of the Vessel.
47. FLAG AND REGISTRY.
The Vessel will become registered under the Bahamian flag with
Freeport, Bahamas as its port of registry, prior to delivery. However, the Owner
shall have the right, subject to Charterers' approval which shall not be
unreasonably withheld, to change the flag and port of registry of the Vessel at
its own discretion, during the Charter Period. ▇▇▇▇▇▇▇▇▇ may withhold approval
unless Owner agrees to pay any and all initial and continuing extra expenses and
costs of whatever kind caused by the change of flag.
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48. MAINTENANCE/DRYDOCKING AND CLASS REPAIRS.
The Charterer shall maintain the Vessel in class and its hull and
machinery in such state as is consistent with usual and customary practice in
the operation of cruise passenger ships of the same type and age as the Vessel,
including (but without limiting the generality of the foregoing) compliance with
SOLAS, USPH, class and the requirements of all applicable laws, reasonable wear
excepted.
Except as otherwise provided herein, the Charterer shall, at his sole
expense, repair and maintain the Vessel to a standard at least as good as at
delivery of same. Charterer shall remain solely responsible for all other
repairs and maintenance of the Vessel required by all applicable laws, SOLAS,
USPH and class rules, including without limitation, the hull, engines and
machinery and attendant spaces, the fire fighting and fire prevention systems,
plumbing, electrical wiring, air conditioning equipment and lifeboats which
shall remain the sole responsibility of the Charterer during the Charter Period.
Notwithstanding the provisions of Clause 9(f), nevertheless, the
Charterer shall bring the Vessel to drydock every twelve (12) months or as
necessary to keep the Vessel in Class. Drydock and vessel classification
repairs, whether scheduled or unscheduled, continuing through Charter Period,
shall be for the account of the Charterer.
49. ▇▇▇▇▇▇▇▇▇'S ADDITIONAL UNDERTAKING.
During the Charter Period, the Charterer to ensure that the Vessel
visits a non-US port at least once every twenty-eight (28) days or as required
by US regulatory authorities for US immigration law purposes. For the avoidance
of doubt, the Vessel to remain on hire during such visits.
50. MASTER'S RIGHTS TO PUT ASHORE.
The Master always to be entitled to put any person ashore in the
interests of the Vessel whether a member of the crew, or staff retained by the
Charterer or a concessionaire or a passenger or otherwise, but not the Owner's
representatives.
51. CHARTERER BOND.
Prior to commencing passenger service from any U.S. port, the Charterer
shall post and maintain a surety bond in an amount as required by the Federal
Maritime Commission's regulations with a good and sufficient surety and the same
shall be posted with the Federal Maritime Commission to comply with its rules
and regulations with respect to Vessel performance and shall be continually kept
in good standing. Failure to post a surety bond as herein required or to keep
the surety bond in continuous good standing shall be and constitute a material
default under this charter. The Charterer shall name as entities covered under
the bond the Owner, Silvercone and Joint Stock Company Tranship ("Tranship").
15
52. NAME.
Charterer shall have the right to change the name of the Vessel with
the approval of the Owner which shall not be unreasonably withheld provided that
charterer shall bear all costs and expenses of changing the name and returning
to the original name.
53. INSURANCE.
The Charterer warrants that on delivery of the Vessel the following
insurance and Financial Responsibility Certificates shall be in effect at the
sole responsibility and for the account of the Charterer:
(a) Hull and Machinery Policy acceptable to Owner;
(b) P&I Passenger Casualty Policy acceptable to Owner;
(c) P&I International Crew Policy acceptable to Owner;
(d) Federal Maritime Commission Certificate re: liability for death or
injury to passengers or other persons; and
(e) United States Coast Guard Vessel Certificate re: financial
responsibility water pollution.
The Charterer shall provide the Owner with copies of all insurance
policies and certificates of financial responsibility, together with
certificates of good standing as to each, and copies of proofs of payment of
premiums or receipted premium payments indicating all premium liability is
maintained current. Such proofs shall be provided annually or more frequently if
more frequent premium payments are involved.
54. INDEMNIFICATION.
▇▇▇▇▇▇▇▇▇ shall indemnify Owner of and from any and all claims which
may be asserted by or on behalf of any passenger or any member of the public or
any member of the crew arising out of injury to persons or property, including
damages for death sustained during any cruise or during any loading or unloading
of the Vessel during the Charter Period except any such claims arising out of
the willful misconduct of Owners or their representatives. Such indemnification
shall include the obligation to defend any claims asserted against the Owner to
pay all attorneys' fees and costs associated therewith through all appeals.
55. OPERATIONAL COSTS AND OPERATIONAL COMPANY.
Charter shall, at its own expense, man, victual, navigate, operate,
supply and fuel the Vessel and maintain such Vessel in a good state of repair,
reasonable wear excepted and in efficient operating condition in accordance with
good commercial maintenance practices, and shall repair her and pay all other
charges and expense of every kind and nature whatsoever
16
incident to the use and operation of the Vessel, except as otherwise
specifically provided in this Charter.
During the Charter Period, it being understood by the Charterer that
V-Ships of Monaco shall not be directly or indirectly involved in the Vessel's
operation, management, crewing, and ▇▇▇▇▇▇▇. Charterer, or any other entity
Charterer authorizes to operate the Vessel, shall obtain all certifications
necessary under international and United States law required to comply with all
laws, conventions, rules and regulations. Additionally, should Charterer execute
an Operating Agreement with any other entity, a copy thereof shall be provided
to the Owner.
56. USPH.
During the Charter Period, the Charterer shall be responsible for
implementing USPH standards at its own cost and expense. The Charterer shall
also be responsible for securing and keeping in full force and effect, at its
expense, all U.S. Maritime and Coast Guard certificates so as to comply with
U.S. law during the Charter Period. Any repairs, modifications or additions
necessary to secure and keep in effect such U.S. certifications shall be the
sole expense of Charterer.
57. OFF HIRE.
The Charterer shall be responsible for all loss of operating time
during the Charter, except for time lost to Owner's material breach of charter.
58. TRADING LIMITS.
The Vessel shall be employed and carry passengers in lawful trades
worldwide, provided that the Vessel will not be operated as a gaming vessel in
or out of the Ports of Port Everglades or New York/New Jersey. Owner shall not
unreasonably withhold approval of additional ports. However, the Charterer can
carry cargo except for hazardous materials, explosives, weapons and items that
can risk the compliance of rules and regulations in the area of trade. In the
event of serious outbreak of pestilence, war, Acts of God, force majeure, or
other causes beyond the Charterer's control making the use of the Vessel in such
trade commercially impracticable for a period in excess of 4 weeks, the Vessel
may be placed or may be sublet for employment in any other safe trades, upon
first securing the approval of the Owner, or Charterers may terminate this
Charter.
59. USE OF EQUIPMENT.
The Charterer shall have the use of all outfit, equipment, spare
supplies, and appliances now on board the Vessel without extra cost provided the
same or their substantial equivalent shall be returned to the Owner on
redelivery in the same good order and condition as when received, reasonable
wear excepted.
17
60. INVENTORY.
The Owner shall prepare a complete inventory list, including deck and
engine and cabins. The Charterer shall verify said inventory list prior to the
day of delivery.
61. VESSEL'S UPGRADES.
Should the Charterer elect to effect upgrades to the Vessel, Charterer
shall be responsible to complete any interior and safety equipment upgrades on
the Vessel in accordance with the requirements for the same improvements
pertaining to the ship's passenger capacity.
Additionally, the Charterer shall indemnify and hold the Owner harmless
of and from any and all liability or responsibility in connection with the same
interior upgrades and should any liens be filed in consequence thereof by any
supplier or materialmen, it shall be the responsibility of the Charterer to pay
such lien or transfer the same to bond within a reasonable time.
The financial requirements set forth in Paragraph 45, "Modifications,"
shall apply to any work undertaken pursuant to this paragraph.
62. SAFETY OF LIFE AT SEA (SOLAS).
All future SOLAS requirements and upgrades are for the account of the
Charterer.
63. CHARTER HIRE.
Commencing as of the date of the day of delivery on or before May 1,
1998 the Charterer shall pay to the Owner the sum of [*]. Such amount will
constitute prepayment of the first twenty-eight (28) days of the Charter.
Subsequent payments to be paid in advance on a [*] basis in the amount of [*]
beginning on May 15, 1998.
64. DELETED.
65. OWNER'S REPRESENTATIVE.
During the pendency of this Bareboat Charter, the Owner, Silvercone or
Tranship, shall have the right to, at all times, have aboard the Vessel an
Owner's representative. The Owner's representative shall be provided a passenger
cabin (upon two week's notice of the desire to use such cabin), to wit, Cabin
No. 2036, and his/her meals at no cost or expense to the Owner. It shall be the
obligation of the Owner's representative to inspect the Vessel and determine
whether or not the Charterer is complying with each, all and every of the terms
and provisions of the Bareboat Charter. Accordingly, should the Owner's
representative determine any material violations or breaches of the Bareboat
Charter, he/she shall provide a notice to the Vessel's Captain, or other
appropriate representative of the Charterer, indicating the nature
* MARKED TEXT OMITTED PURSUANT TO AN APPLICATION FOR AN ORDER FOR CONFIDENTIAL
TREATMENT BY COMMODORE HOLDINGS LIMITED
18
of the violation or breach, in which event the Charterer shall be under an
obligation to cure the default within the time provided in Paragraph 88 of this
Bareboat Charter, or a default shall occur.
66. HOUSE CABINS.
The Owner and the Charterer agree that during the term of the Bareboat
Charter, the Owner, Silvercone or Tranship, shall have the right to the use,
occupancy and possession of one (1) cabin, to wit Cabin No. 1015. This cabin
shall not be sold or used by Charterer's passengers, but may be used by the
Owner or Owner's designees, provided that Charterers may sell this cabin if it
has not been reserved by Owners more than one month prior to the commencement of
the voyage.
67. LIENS.
(a) Charterer shall have no lien rights against the Vessel for any sums
expended for the improvement of the Vessel as all such expenditures are either
required to be made by the terms of this Charter or expenditures that Charterer
volunteers because of alterations, modifications or upgrades it elects.
(b) In the event a lien is filed with the U.S. Coast Guard or with any
federal or state court for any reason during the Charter Period as a result of
the activity or conduct of the Charterer, then it shall be the obligation of the
Charterer to provide immediate notice to the Owner of the existence of the lien
and to, within ten (10) days next after Charterer has notice of the lien, either
pay the lien or transfer the same to bond, and should Charterer fail to do so,
then Owner shall have the right to:
i. declare a default and cancel the Bareboat Charter imposing the
liquidated damage provisions hereinafter set forth; and
ii. pay the lien or transfer the same to bond in which event all
moneys advanced in consequence thereof shall be and constitute additional
charter hire due and payable with the next charter hire periodic payment.
68. VESSEL LOGS.
During the Charter Period, it shall be the obligation of the Charter to
insure that the Captain and Chief Engineer of the Vessel maintain a daily log in
traditional form.
69. LOSS OR DESTRUCTION OF THE VESSEL.
Should the Vessel be lost or destroyed as a result of casualty or for
any other reason, then this Bareboat Charter shall be canceled, each party shall
be released from further liability hereunder and it shall not be the obligation
of the Owner to replace the Vessel; provided, however, that any claim or
obligation accruing prior to the time of such loss or destruction shall survive
such cancellation. Any cancellation under this Paragraph shall impose the duty
19
upon the Owner to return to the Charterer any prepaid charter hire. Owner will
obtain for ▇▇▇▇▇▇▇▇▇'s benefit insurance covering ▇▇▇▇▇▇▇▇▇'s interest to the
extent of its payments and expenses prior to delivery in the event of the loss
or destruction of the Vessel prior to delivery.
70. EVENTS OF DEFAULT.
Should any one or more of the following events occur, one party may,
without prejudice to the exercise of any right or remedy which may be available
to it, cancel this Charter forthwith or terminate the Charter on such notice
which, in its absolute discretion, it might think fit:
(a) the party shall fail to perform or comply in any material respect
with any one or more of its covenants, duties or obligations thereunder and,
having been given written notice of such failure, fails to rectify such failure
within ten (10) days, unless such party has commenced and is diligently
attempting to correct such failure within said ten (10) day period;
(b) any material statement, representation or warranty of the other
party contained in this Charter or in any document furnished pursuant to this
Charter shall prove to be knowingly or recklessly or negligently untrue or
incorrect in any material respect when made;
(c) i. the Vessel is requisitioned by title or for use by any
government claiming jurisdiction; or
ii. the Vessel becomes an actual or constructive total loss; or
iii. the other party shall (A) admit in writing its inability to
pay its debts as they mature; or (B) make any general assignment for the benefit
of creditors; or (C) be adjudicated bankrupt or insolvent, or be dissolved; or
(D) file a petition in bankruptcy or for the reorganization or for arrangement
pursuant to a Bankruptcy Act or any insolvency law providing for relief of
debtors now or hereafter in effect; or (E) file an answer admitting material
allegations of or consent to or default in answering a petition filed against it
in bankruptcy, reorganization or insolvency process, or take corporate action
for purpose of effecting any of the foregoing; or (F) be the subject of any
order made or resolution passed for its winding up.
71. CHARTERER'S DEFAULT.
In the event Charterer defaults in carrying out its obligations
hereunder after notice and a ten (10) day opportunity to cure (other than
defaults as a result of liens against the Vessel), then, and in such event, the
Charterer shall pay to the Owner the sum of [*] as agreed liquidated damages
less the amount of any prepaid charter hire. Upon the payment of liquidated
damages, both parties shall be released of and from any and all further
obligations under this Bareboat Charter and the same shall be deemed cancelled.
* MARKED TEXT OMITTED PURSUANT TO AN APPLICATION FOR AN ORDER FOR CONFIDENTIAL
TREATMENT BY COMMODORE HOLDINGS LIMITED
20
72. SECURITY FOR OWNER'S PERFORMANCE.
And as for security for the Owner's performance of its obligations
under this Bareboat Charter and the payment of any sums due hereunder by the
Owner to the Charterer, the Owner does hereby grant to the Charterer a lien
against the Vessel, which lien shall be enforceable by the Charterer only in the
event a default occurs and is not cured within the time provided in Paragraph 73
below.
73. OWNER'S DEFAULT.
In the event Owner defaults in carrying out its obligations hereunder
(other than a willful default in connection with the delivery of the Vessel to
Charterer or the right of Charterer to possess such Vessel during the Initial
Period, for which Charterer shall be entitled to seek its actual damages or
specific performance) and such default interferes with the continued possession
and use of the Vessel by the Charterer and after notice and a ten (10) day
opportunity to cure, then, and in such event, then Owner shall pay to the
Charterer the sum of [*] as agreed liquidated damages. Upon the payment of the
liquidated damages, each party shall be released of and from further obligations
under this Bareboat Charter and the same shall be deemed cancelled. Any other
defaults by the Owner not involving or affecting the possession and use of the
Vessel by the Charterer shall be remedied by the Charterer by deducting the
amount to cure from the charter hire in progressive order of charter hire
payments.
74. ATTORNEY'S FEES.
In the event a dispute arises in connection with this Bareboat Charter,
the prevailing party shall be entitled to recover reasonable attorneys' fees
incurred to and through all appeals.
75. ASSIGNMENT.
The Charterer may not assign this Bareboat Charter unless it has first
obtained the written consent of the Owner, which shall not be unreasonably
withheld, except that Charterer shall be permitted to assign the Charter and/or
subcharter the Vessel to an affiliate.
76. DELETED.
77. DELETED.
* MARKED TEXT OMITTED PURSUANT TO AN APPLICATION FOR AN ORDER FOR CONFIDENTIAL
TREATMENT BY COMMODORE HOLDINGS LIMITED
21
78. NOTICES.
Notices to the parties may be hand-delivered, transmitted by regular
mail, transmitted by facsimile transmission or Federal Express to the
representative parties at the following addresses:
CHARTERER: Commodore Cruises Limited
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇-▇
▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
OWNER: Cruise Charter Ltd.
c/▇ ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇
▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
P.O. Box "N" 1605
Nassau, Bahamas
79. ARBITRATION.
Any dispute arising under this Bareboat Charter is to be referred to
arbitration in the City of Fort Lauderdale, County of Broward, State of Florida,
conducted according to the Rules of the Miami Maritime Arbitration Council,
before three arbitrators one arbitrator to be nominated by the Charterer and the
other by the Owner, and the third by the two so chosen, the award of the
arbitrators to be final and binding upon both parties. Where appropriate, award
of the arbitrators may include any or all of affirmative relief, including
injunctive relief. General Maritime Law of the United States, and, where such
law does not apply, the law of Florida shall govern this Charter.
80. DELETED.
81. BROKERS.
Except as otherwise noted in Box 32, the Owner and the Charterer hereby
represent to each other that neither has contacted any broker in connection with
the instant Charter and should any broker or person make any claim for
commission as a result of the alleged activity of either party (other than as
noted in Box 32) then, the party responsible shall indemnify the other party of
and from any and all responsibility or liability in connection with such claim,
which shall include the duty to defend such claim. The fee of the broker noted
in Box 32 shall be paid by the Charterer.
82. MISCELLANEOUS.
Clause headings are for ease of reference only and shall not affect
construction.
22
83. DELETED.
84. DELETED.
85. DELETED.
86. MATERIAL BREACH.
A material breach on the part of the Charterer shall mean a failure on
its part to observe and comply with any of the following:
(a) Payment of the charter hire, as required herein;
(b) Failure to post and maintain in good standing Federal Maritime
commission bond, as required herein;
(c) Failure to pay or to bond liens against the Vessel where required
herein; and
(d) Failure to carry out maintenance obligations to the extent that the
same materially affect the seaworthiness of the Vessel.
In addition to the above enumerated material breaches, a material
breach shall also include any failure by Charterer to carry out a covenant or
obligation under this Charter involving an expense to cure of $250,000.00 or
more, or a loss to the Owner in consequence thereof in an amount of $250,000.00
or more. Additionally, a material default of the Owner shall be the violation of
any obligation or covenant of this Charter which results in depriving the
Charterer of the use and possession of the Vessel. A material breach shall also
be and constitute any violation of the Charter by the Owner involving costs or
damages to the Charterer in an amount of $250,000.00 or more.
87. DELETED.
88. NOTICE OF DEFAULT.
Anything to the contrary in any part of this Charter notwithstanding,
whether in Parts I, II or this Addendum, Owners shall not repossess the Vessel
or deem Charterers in default unless Charterers first notice of, and a ten (10)
day opportunity to cure, any condition or event which Owners believe in good
faith to constitute a default, and of Owners' intention to declare Charterers to
be in default therefor.
89. CONFLICT.
In the event of any conflict between Part I and Part II of this Charter
on the one hand and the "Addendum" set forth in Paragraphs 43 through 90 on the
other hand, then Paragraphs 43 through 90 shall control.
23
90. COUNTERPARTS.
This Charter may be executed in two or more counterparts, each of which
shall be deemed an original but all of which together shall constitute one and
the same instrument.
Signed, sealed and delivered
In the presence of: CHARTERER:
COMMODORE CRUISES LIMITED
/S/ ▇▇▇▇▇▇ CAMERA By:/S/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------------------ -------------------------------
Witness ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Chairman
OWNER:
CRUISE CHARTER, LTD.
By:/S/ ▇▇▇▇▇▇▇ ▇▇▇▇▇
------------------------------ -------------------------------
Witness ▇▇▇▇▇▇▇ ▇▇▇▇▇, President
24
SECOND ADDENDUM TO BARECON '89 BAREBOAT CHARTER
THIS SECOND ADDENDUM (the "Second Addendum") is made and entered into
this 16th day of March, 1998 between Cruise Charter, Ltd., a Bahamian
corporation, as Owner (the "Owner"), and Commodore Cruises Limited, a Bermudian
corporation, as Charterer (the "Charterer").
WHEREAS, Owner and ▇▇▇▇▇▇▇▇▇ entered into the Barecon '89 Bareboat
Charter and the Addendum thereto on March 9, 1998 (the "Charter"), pursuant to
which Owner agreed to charter the M/V Island Holiday to Charterer; and
WHEREAS, Owner and Charterer wish to amend the Charter in certain
respects.
NOW THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereby agree as
follows:
1. BOX 10. Box 10, "Class," of the Charter is hereby amended
by deleting the language contained therein and substituting the following
language in its place:
KM(*)A3(2)(being changed to a classification society
acceptable to the Bahamian registry (the "New Class"))
2. BOX 13. Box 13, "Port or Place of Delivery," of the Charter
is hereby amended by deleting the language contained therein and substituting
the following language in its place:
New Orleans, Louisiana
3. BOX 14. Box 14, "Time for Delivery," of the Charter is
hereby amended by deleting the language contained therein and substituting the
following language in its place:
May 14, 1998, or earlier per Clause 44
4. BOX 15. Box 15, "Canceling Date," is hereby amended by
deleting the language contained therein and substituting the following language
in its place:
May 20, 1998
5. BOX 16. Box 16, "Port or Place of Redelivery," is hereby
amended by deleting the language contained therein and substituting the
following language in its place:
Freeport, Grand Bahama
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6. BOX 19. Box 19, "Trading Limits," of the Charter is hereby
amended by deleting the language contained therein and substituting the
following language in its place:
Lawful trades in North, Central and South America, the
Caribbean, Europe (including Scandinavia and the Mediterranean
Sea west of the Suez Canal), Australia, Japan, China
(including Hong Kong) and Singapore. Vessel is not to operate
day cruises from the Port of New York/New Jersey, Port
Everglades, or the Port of Miami.
7. BOX 20. Box 20, "Charter Period," of the Charter is hereby
amended by deleting the language contained therein and substituting the
following language in its place:
From delivery until January 1, 2003 with rights of first offer
as per Clause 43 of Addendum
8. PERIOD/EXTENSIONS. Clause 43 of the Addendum to the Charter
is hereby amended by deleting the first sentence thereof and replacing such
sentence with the following language:
Subject to the right of termination as is herein after set
forth and further subject to the terms and conditions as are
provided herein, the Owner shall let and the Charterer shall
hire the Vessel from delivery until 12 noon on January 1, 2003
(the "Initial Period").
9. DELIVERY/SURVEY AND CONDITION ON DELIVERY. Clause 44 of the
Addendum to the Charter is hereby amended by deleting subclauses 44(a), 44(c)
and 44(d) contained therein and substituting the following subclauses in their
respective places:
(a) Owner shall deliver the Vessel to Charterer at 12 noon on
May 14, 1998 or such earlier date not before May 1, 1998 on
which the Vessel can be delivered in compliance with this
Clause 44 (the "Delivery Date") at New Orleans, Louisiana, as
agreed fully found and in compliance both with the
requirements for registry under the Bahamian flag (and
actually registered under the Bahamian flag) and the
requirements of the New Class, without comments, in a
condition in accordance with the Condition Report described
below, and in compliance with current SOLAS and USPH
regulations. Subject to the terms and conditions hereof,
including without limitation the requirement that the Vessel
be delivered registered under and in compliance with the
requirements of the Bahamian flag and the New Class, without
comments, and in compliance with current SOLAS regulations,
Charterers will accept delivery of the Vessel on the Delivery
Date, at New Orleans, Louisiana, and such delivery shall
constitute full and proper delivery to the Charterer under the
Charter.
Should the Vessel be delivered not registered under the
Bahamian flag, or in a condition not, in some material aspect,
in accordance with the requirements of
-2-
the Bahamian flag, the New Class (without comments), the
Condition Report or current SOLAS or USPH regulations, then
Charterer will have the option to reject the Vessel or to make
the repairs required for the Vessel to meet the conditions set
forth herein at the Owner's expense. Should the Vessel be
delivered in a condition not in accordance with the
requirements of the Bahamian flag, the New Class (without
comments), the Condition Report or current SOLAS or USPH
regulations, where such deviation from such requirements is
not material, Charterer shall accept delivery of the Vessel,
and shall make such repairs required for the Vessel to meet
the conditions set forth herein at the Owner's expense.
(c) After the survey of the Vessel and before the Delivery
Date, Charterer shall execute a written inventory confirmation
to which there shall be attached a description of the personal
property comprising the Vessel's equipment, furniture,
furnishings and gear and the Charterer shall be responsible
for the care, maintenance and replacement of such inventory
during the Charter Period and shall be further responsible to
return the same inventory to the Owner upon re-delivery of the
Vessel at the termination of the Charter.
(d) If the Owner has not delivered the Vessel at New Orleans,
Louisiana on or before May 14, 1998, by reason of Owner's
wilful default, the Owner shall pay to the Charterer the sum
of [*] Dollars [*] per day (the "Late Charges") for each day
after May 14, 1998, that the Vessel has not been delivered as
aforesaid. If the Vessel is not delivered at New Orleans,
Louisiana on or before May 20, 1998, Charterer, at its option,
may elect to terminate this Bareboat Charter (at which time
Late Charges will cease to accrue) or seek either damages for
its losses and/or specific performance. Owner represents and
warrants that it has the full right and authority to deliver
the Vessel as agreed.
10. MAINTENANCE/DRYDOCKING AND CLASS REPAIRS. Clause 48 of the
Addendum to the Charter is hereby amended by adding the following language to
the end of Clause 48:
Notwithstanding the foregoing, on or about April 23, 1998,
Owner shall place the Vessel in drydock for the purpose of
completing work necessary to cause the Vessel to comply with
the requirements of the Bahamian flag and the New Class (the
"Flag and Class Repairs"). Such Flag and Class Repairs shall
be performed at Owner's expense except that, upon delivery of
the Vessel, Charterer shall pay Owner [*] for drydock
expenses. On or after the date Owner delivers the Vessel to
drydock for the Flag and Class Repairs, Charterer may cause
additional work to be performed on the Vessel at its sole
expense. Charterer shall be entitled to have a representative
present during such drydock. Owner shall be responsible for
all expenses of the Vessel (including but not limited to
insurance and crew wages) until the Vessel is delivered to
Charterer.
* MARKED TEXT OMITTED PURSUANT TO AN APPLICATION FOR AN ORDER FOR CONFIDENTIAL
TREATMENT BY COMMODORE HOLDINGS LIMITED
-3-
11. CHARTERER BOND. Clause 51 of the Addendum to the Charter
is hereby amended by deleting the last sentence thereof and replacing such
sentence with the following language:
The Charterer shall name as entities covered under the bond
the Owner, Silvercone and Norsong Shipping, Ltd., a Liberian
corporation ("Norsong").
12. TRADING LIMITS. Clause 58 of the Addendum to the Charter
is hereby amended by deleting the first sentence thereof and replacing such
sentence with the following language:
The Vessel shall be employed and carry passengers in lawful
trades in North, Central and South America, the Caribbean,
Europe (including Scandinavia and the Mediterranean Sea west
of the Suez Canal), Australia, Japan, China (including Hong
Kong) and Singapore, provided that the Vessel will not be
operated as a day cruise vessel in or out of the ports of
Miami, Port Everglades or the Port of New York/New Jersey.
Such prohibition shall not prevent the Vessel from being
operated on multi-day cruises in or out of such designated
ports.
13. CHARTER HIRE. Clause 63 of the Addendum to the Charter is
hereby amended by deleting the language contained therein and substituting the
following language in its place:
Commencing as of May 1, 1998, the Charterer shall pay to the
Owner the sum of [*]. Such amount will constitute prepayment
of drydock hire and prepayment of Charter hire through May 29,
1998. Subsequent payments to be paid in advance on a [*] basis
in the amount of [*] beginning on May 15, 1998.
Upon confirmation by Charterer that the Flag and Class Repairs
have been completed and release of the Vessel from the drydock
shipyard, the Charterer shall also pay the shipyard the sum of
[*] toward the Flag and Class Repairs. Notwithstanding the
foregoing, the Charterer and the Owner will use their
reasonable best efforts to obtain the best payment terms from
the drydock shipyard, and if the shipyard agrees to accept
some or all of the payment for the Flag and Class Repairs
after the release of the Vessel from drydock, then Charterer
shall pay the shipyard its pro rata portion of each payment
due the shipyard, as and when required by the shipyard, based
on the ratio of [*] divided by the total amount due the
shipyard for the Flag and Class Repairs.
14. OWNER'S REPRESENTATIVE. Clause 65 of the Addendum to the
Charter is hereby amended by deleting the first sentence thereof and replacing
such sentence with the following language:
* MARKED TEXT OMITTED PURSUANT TO AN APPLICATION FOR AN ORDER FOR CONFIDENTIAL
TREATMENT BY COMMODORE HOLDINGS LIMITED
-4-
During the pendency of this Bareboat Charter, Silvercone or
Norsong shall have the right to, at all times, have aboard the
Vessel an Owner's representative.
15. HOUSE CABINS. Clause 66 of the Addendum to the Charter is
hereby amended by deleting the first sentence thereof and replacing such
sentence with the following language:
The Owner and the Charterer agree that during the term of the
Bareboat Charter, ▇▇▇▇▇▇▇▇▇▇ shall have the right to the use,
occupancy and possession of one (1) cabin, to wit Cabin No.
1015.
16. ASSIGNMENT. Clause 75 of the Addendum to the Charter is
hereby amended by deleting the language contained therein and substituting the
following language in its place:
The Charterer may not assign this Bareboat Charter unless it
has first obtained the written consent of the Owner, which
shall not be unreasonably withheld, except that Charterer
shall be permitted to assign the Charter and/or subcharter the
Vessel to an affiliate, in which case Charterer shall remain
responsible for the performance of this Bareboat Charter.
17. RATIFICATION. Except as specifically amended hereby, all
terms of the Charter shall remain in full force and effect.
IN WITNESS WHEREOF, the parties have executed this Second Addendum on
the date first above written.
CHARTERER:
COMMODORE CRUISES LIMITED,
a Bermudian corporation
By: /S/ ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-----------------------------------
▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, President
OWNER:
CRUISE CHARTER, LTD.,
a Bahamian corporation
By: /S/ ▇▇▇▇▇▇▇ ▇▇▇▇▇
-----------------------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇, President
-5-
THIRD AMENDMENT TO BARECON '89 BAREBOAT CHARTER
THIS THIRD AMENDMENT (the "Third Amendment") is made and entered into
this 27th day of May, 1998, between Cruise Charter, Ltd., a Bahamian
corporation, as Owner (the "Owner"), and Commodore Cruises Limited, a Bermudian
corporation, as Charterer (the "Charterer").
WITNESSETH:
WHEREAS, Owner and Charterer entered into the Barecon '89 Bareboat
Charter and the Addendum thereto on March 9, 1998, which was further amended on
March 16, 1998 (the "Charter"), pursuant to which Owner agreed to charter the
"M/V Island Holiday" (the "Vessel") to Charterer, and
WHEREAS, Owner and Charterer wish to amend the Charter in certain
respects.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereby agree as
follows:
1. BOX 13: Box 13, "Port of Place of Delivery" of the Charter is hereby
amended by deleting the language contained therein and substituting the
following language in its place:
Mobile, Alabama
2. BOX 15: Box 15, "Canceling Date" is hereby amended by deleting the
language contained therein and substituting the following date in its place:
May 27, 1998
3. ASSIGNMENT: Clause 75 of the Addendum to the Charter is hereby
amended by adding the following language to the end of such clause:
Owner acknowledges that the Charterer has assigned this
Charter to Capri Cruises, a Florida general partnership, which
is affiliated with Charterer. ▇▇▇▇▇▇▇▇▇ to remain responsible
for Charter.
4. DELIVERY/SURVEY AND CONDITION FOR DELIVERY: Pursuant to the Charter,
Owner has an obligation to deliver the Vessel to Charterer in accordance with
the requirements of the Bahamian flag, the New Class, the Condition Report and
current SOLAS and USPH regulations. The parties agree that in order to meet such
requirements, certain tanks aboard the Vessel must be replaced at a cost which
is not expected to exceed $_________________ up to $300,000.00 of which will be
credited against Charter Hire due under the First Sub-Bareboat Charter and the
Prime Charter, all in accordance with the provisions of the Third Addendum to
the Bareboat
Charter dated September 26, 1997, a copy of which is appended hereto and made a
part hereof, and Norsong Shipping, Ltd. and Silvercone Holdings Limited have
endorsed this Third Amendment to signify their acceptance of such Charter Hire
adjustment. Although the parties acknowledge that the cost of such repairs is
the obligation of the Owner, the Charterer has agreed to advance [*] of such
amount, up to [*] toward the cost of such repairs. The parties agree that
Charterer shall recoup such amount by offsetting equal portions of the total
amount advanced from the [*] installments of Charter Hire beginning on May 29,
1998.
▇▇▇▇ ▇▇▇▇▇▇▇▇ is hereby authorized on behalf of Owner and ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ or ▇▇▇▇ ▇▇▇▇▇▇▇▇ is hereby authorized on behalf of ▇▇▇▇▇▇▇▇▇ to execute
the Protocol of Delivery and Acceptance and associated inventory in connection
with the delivery of the Vessel.
5. RATIFICATION. Except as specifically amended hereby, all terms of
the Charter shall remain in full force and effect.
IN WITNESS WHEREOF, the parties have executed this Third Amendment on
the date first above-written.
Signed, sealed and delivered
in the presence of: CHARTERER:
COMMODORE CRUISES LIMITED, a Bermudian
corporation
By: /S/ ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-----------------------------------
▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, President
OWNER:
CRUISE CHARTER, LTD., a Bahamian
corporation
By: /S/ ▇▇▇▇▇▇▇ ▇▇▇▇▇
-----------------------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇, President
* MARKED TEXT OMITTED PURSUANT TO AN APPLICATION FOR AN ORDER FOR CONFIDENTIAL
TREATMENT BY COMMODORE HOLDINGS LIMITED
-2-
ASSIGNEE:
CAPRI CRUISES, a Florida general partnership
By: Commodore Cruises Limited, a general
partner
By: /S/ ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-----------------------------------------------
▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, President
ACCEPTED AND AGREED:
NORSONG SHIPPING. LTD., a Liberian
corporation
By: /S/ ▇▇▇▇ ▇▇▇▇▇▇▇
-----------------------------------------------
▇▇▇▇ ▇▇▇▇▇▇▇
Authorized Representative
SILVERCONE HOLDINGS LIMITED, a Cypriot
corporation
By: /S/ ▇▇▇▇ ▇▇▇▇▇▇▇
-----------------------------------------------
▇▇▇▇ ▇▇▇▇▇▇▇
Authorized Representative
-3-