EXHIBIT 10.11
THE BALTIC AND INTERNATIONAL MARITIME COUNCIL (BIMCO) [LOGO]
STANDARD SHIP MANAGEMENT AGREEMENT PART I
CODE NAME: "▇▇▇▇▇▇▇ 98"
1. Date of Agreement JULY 1, 2004
2. Owners (name, place of registered office and law of registry) (CI.1)
ADVENTURE TWO S.A.
Name
TRUST COMPANY COMPLEX, AJELTAKE RD
Place of registered office
AJELTAKE ISLAND, MAJURO
Law of registry
▇▇▇▇▇▇▇▇ ISLANDS
3. Managers (name, place of registered office and law of registry) (CI. 1)
FREE BULKERS S.A.
Name
TRUST COMPANY COMPLEX, AJELTAKE RD
Place of registered office
AJELTAKE ISLAND, MAJURO, ▇▇▇▇▇▇▇▇ ISLANDS
Law of registry WITH OFFICES AT ▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ - ▇▇ ▇▇▇▇▇ - ▇▇▇▇▇▇
4. Day and year of commencement of Agreement (CI. 2)
UPON SIGNATURE OF THIS AGREEMENT
5. Crew Management (state "yes" or "no" as agreed) (CI. 3.1)
YES
6. Technical Management (state "yes" or "no" as agreed) (CI. 3.2)
YES
7. Commercial Management (state "yes" or "no" as agreed) (CI. 3.3)
YES
8. Insurance Arrangements (state "yes" or "no" as agreed) (CI. 3.4)
YES
9. Accounting Services (state "yes" or "no" as agreed) (CI. 3.5)
YES
10. Sale or purchase of the Vessel (state "yes" or "no" as agreed) (CI. 3.6)
YES
11. Provisions (state "yes" or "no" as agreed) (CI. 3.7)
YES
12. Bunkering (state "yes" or "no" as agreed) (CI. 3.8)
YES
13. Chartering Services Period (only to be filled in if "yes" stated in Box 7)
(CI. 3.3(i))
YES
14. Owners' Insurance (state alternative (i), (ii) or (iii) of CI. 6.3)
YES
15. Annual Management Fee (state annual amount) (CI. 8.1)
USD 15,000 per month or prorata
16. Severance Costs (state maximum amount) (CI. 8.4(ii))
17. Day and year of termination of Agreement (CI. 17)
AS PER CC. 17
18. Law and Arbitration (state alternative 19.1, 19.2 or 19.3; if 19.3 place
of arbitration must be stated) (CI. 19)
ENGLISH LAW, LONDON ARBITRATION
19. Notices (state postal and cable address, telex and telefax number for
serving notice and communication to the Owners) (CI. 20)
c/o FREE BULKERS S.A.
unless otherwise notified in writing
20. Notices (state postal and cable address, telex and telefax number for
serving notice and communication to the Managers) (CI. 20}
▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇
TEL: ▇▇▇-▇▇▇-▇▇▇▇▇▇▇
FAX: ▇▇▇-▇▇▇-▇▇▇▇▇▇▇
It is mutually agreed between the party stated in Box 2 and the party stated in
Box 3 that this Agreement consisting of PART I and PART II as well as Annexes
"A" (Details or Vessel), "B" (Details of Crew), "C" (Budget) and "D" (Associated
vessels) attached hereto, shall be performed subject to the conditions contained
herein. In the event of a conflict of conditions, the provisions of PART I and
Annexes "A", "B", "C" and "D" shall prevail over those of PART II to the extent
of such conflict but no further.
Signature(s)(Owners) Signature(s)(Managers)
/s/ ▇▇▇▇▇▇ ▇. Gourdomichalis /s/ Ion Varouxakis
Printed and sold by Fr. G. Knudtzons Bogtrykkeri A/S,Vallensbaekvej 61, DK-2625
Vallensbaek.Fax: ▇▇ ▇▇▇▇ ▇▇▇▇
The Baltic and International Maritime Council (BIMCO), Copenhagen
ISSUED: August 1998
PART II
"▇▇▇▇▇▇▇ 98" STANDARD SHIP MANAGEMENT AGREEMENT
1. DEFINITIONS
In this Agreement save where the context otherwise requires, the following
words and expressions shall have the meanings hereby assigned to them.
"Owners" means the party identified in Box 2.
"Managers" means the party identified in Box 3.
"Vessel" means the vessel or vessels details of which are set out in Annex
"A" attached hereto.
"Crew" means the Master, officers and ratings of the numbers, rank and
nationality specified in Annex "B" attached hereto.
"Crew Support Costs" means all expenses of a general nature which are not
particularly referable to any individual vessel for the time being managed
by the Managers and which are incurred by the Managers for the purpose of
providing an efficient and economic management service and, without
prejudice to the generality of the foregoing, shall include the cost of
crew standby pay, training schemes for officers and ratings, cadet
training schemes, sick pay, study pay, recruitment and interviews.
"Severance Costs" means the costs which the employers are legally obliged
to pay to or in respect of the Crew as a result of the early termination
of any employment contract for service on the Vessel.
"Crew Insurances" means insurances against crew risks which shall include
but not be limited to death, sickness, repatriation, injury, shipwreck
unemployment indemnity and loss of personal effects.
"Management Services" means the services specified in sub-clauses 3.1 to
3.8 as indicated affirmatively in Boxes 5 to 12. "ISM Code" means the
International Management Code for the Safe Operation of Ships and for
Pollution Prevention as adopted by the International Maritime Organization
(IMO) by resolution A.741 (18) or any subsequent amendment thereto.
"STCW 95" means the International Convention on Standards of Training,
Certification and Watchkeeping for Seafarers, 1978, as amended in 1995 or
any subsequent amendment thereto.
2. APPOINTMENT OF MANAGERS
With effect from the day and year stated in Box 4 and continuing unless
and until terminated as provided herein, the Owners hereby appoint the
Managers and the Managers hereby agree to act as the Managers of the
Vessel.
3. BASIS OF AGREEMENT
Subject to the terms and conditions herein provided, during the period of
this Agreement, the Managers shall carry out Management Services in
respect of the Vessel as agents for and on behalf of the Owners. The
Managers shall have authority to take such actions as they may from time
to time in their absolute discretion consider to be necessary to enable
them to perform this Agreement in accordance with sound ship management
practice.
3.1 CREW MANAGEMENT
(only applicable if agreed according to Box 5)
The Managers shall provide suitably qualified Crew for the Vessel as
required by the Owners in accordance with the STCW 95 requirements,
provision of which includes but is not limited to the following functions:
(i) selecting and engaging the Vessel's Crew, including payroll
arrangements, pension administration, and insurances for the Crew
other than those mentioned in Clause 6;
(ii) ensuring that the applicable requirements of the law of the flag of
the Vessel are satisfied in respect of ▇▇▇▇▇▇▇ levels, rank,
qualification and certification of the Crew and employment
regulations including Crew's tax, social insurance, discipline and
other requirements;
(iii) ensuring that all members of the Crew have passed a medical
examination with a qualified doctor certifying that they are fit for
the duties for which they are engaged and are in possession of valid
medical certificates issued in accordance with appropriate flag
State requirements. In the absence of applicable flag State
requirements the medical certificate shall be dated not more than
three months prior to the respective Crew members leaving their
country of domicile and maintained for the duration of their service
on board the Vessel;
(iv) ensuring that the Crew shall have a command of the English language
of a sufficient standard to enable them to perform their duties
safely;
(v) arranging transportation of the Crew, including repatriation;
(vi) training of the Crew and supervising their efficiency;
(vii) conducting union negotiations;
(viii) operating the Managers' drug and alcohol policy unless otherwise
agreed.
3.2 TECHNICAL MANAGEMENT
(only applicable if agreed according to Box 6)
The Managers shall provide technical management which includes, but is not
limited to, the following functions:
(i) provision of competent personnel to supervise the maintenance and
general efficiency of the Vessel;
(ii) arrangement and supervision of dry dockings, repairs, alterations
and the upkeep of the Vessel to the standards required by the Owners
provided that the Managers shall be entitled to incur the necessary
expenditure to ensure that the Vessel will comply with the law of
the flag of the Vessel and of the places where she trades, and all
requirements and recommendations of the classification society;
(iii) arrangement of the supply of necessary stores, spares and
lubricating oil;
(iv) appointment of surveyors and technical consultants as the Managers
may consider from time to time to be necessary;
(v) development, implementation and maintenance of a Safety Management
System (SMS) in accordance with the ISM Code (see sub-clauses 4.2
and 5.3).
3.3 COMMERCIAL MANAGEMENT
(only applicable if agreed according to Box 7)
The Managers shall provide the commercial operation of the Vessel, as
required by the Owners, which includes, but is not limited to, the
following functions:
(i) providing chartering services in accordance with the Owners'
instructions which include, but are not limited to, seeking and
negotiating employment for the Vessel and the conclusion (including
the execution thereof) of charter parties or other contracts
relating to the employment of the Vessel. If such a contract exceeds
the period stated in Box 13, consent thereto in writing shall first
be obtained from the Owners.
(ii) arranging of the proper payment to Owners or their nominees of all
hire and/or freight revenues or other moneys of whatsoever nature to
which Owners may be entitled arising out of the employment of or
otherwise in connection with the Vessel.
(iii) providing voyage estimates and accounts and calculating of hire,
freights, demurrage and/or despatch moneys due from or due to the
charterers of the Vessel;
(iv) issuing of voyage instructions;
(v) appointing agents;
(vi) appointing stevedores;
(vii) arranging surveys associated with the commercial operation of the
Vessel.
3.4 INSURANCE ARRANGEMENTS
(only applicable if agreed according to Box 8)
The Managers shall arrange insurances in accordance with Clause 6, on such
terms and conditions as the Owners shall have instructed or agreed, in
particular regarding conditions, insured values, deductibles and
franchises.
3.5 ACCOUNTING SERVICES
(only applicable if agreed according to Box 9)
The Managers shall:
(i) establish an accounting system which meets the requirements of the
Owners and provide regular accounting services, supply regular
reports and records,
(ii) maintain the records of all costs and expenditure incurred as well
as data necessary or proper for the settlement of accounts between
the parties.
3.6 SALE OR PURCHASE OF THE VESSEL
(only applicable if agreed according to Box 10)
The Managers shall, in accordance with the Owners instructions, supervise
the sale or purchase of the Vessel, including the
PART II
"▇▇▇▇▇▇▇ 98" STANDARD SHIP MANAGEMENT AGREEMENT
performance of any sale or purchase agreement, but not negotiation of the
same.
3.7 PROVISIONS (only applicable if agreed according to Box 11) The
Managers shall arrange for the supply of provisions.
3.8 BUNKERING (only applicable if agreed according to Box 12) The Managers
shall arrange for the provision of bunker fuel of the quality specified by
the Owners as required for the Vessel's trade.
4. MANAGERS' OBLIGATIONS
4.1 The Managers undertake to use their best endeavours to provide the
agreed Management Services as agents for and on behalf of the Owners in
accordance with sound ship management practice and to protect and promote
the interests of the Owners in all matters relating to the provision of
services hereunder. Provided, however, that the Managers in the
performance of their management responsibilities under this Agreement
shall be entitled to have regard to their overall responsibility in
relation to all vessels as may from time to time be entrusted to their
management and in particular, but without prejudice to the generality of
the foregoing, the Managers shall be entitled to allocate available
supplies, manpower and services in such manner as in the prevailing
circumstances the Managers in their absolute discretion consider to be
fair and reasonable.
4.2 Where the Managers are providing Technical Management in accordance
with sub-clause 3.2, they shall procure that the requirements of the law
of the flag of the Vessel are satisfied and they shall in particular be
deemed to be the "Company" as defined by the ISM Code, assuming the
responsibility for the operation of the Vessel and taking over the duties
and responsibilities imposed by the ISM Code when applicable.
5. OWNERS' OBLIGATIONS
5.1 The Owners shall pay all sums due to the Managers punctually in
accordance with the terms of this Agreement.
5.2 Where the Managers are providing Technical Management in accordance
with sub-clause 3.2, the Owners shall:
(i) procure that all officers and ratings supplied by them or on their
behalf comply with the requirements of STCW 95;
(ii) instruct such officers and ratings to obey all reasonable orders of
the Managers in connection with the operation of the Managers'
safety management system.
5.3 Where the Managers are not providing Technical Management in
accordance with sub-clause 3.2, the Owners shall procure that the
requirements of the law of the flag of the Vessel are satisfied and that
they, or such other entity as may be appointed by them and identified to
the Managers, shall be deemed to be the "Company" as defined by the ISM
Code assuming the responsibility for the operation of the Vessel and
taking over the duties and responsibilities imposed by the ISM Code when
applicable.
6. INSURANCE POLICIES
The Owners shall procure, whether by instructing the Managers under
sub-clause 3.4 or otherwise, that throughout the period of this Agreement:
6.1 at the Owners' expense, the Vessel is insured for not less than her
sound market value or entered for her full gross tonnage, as the case may
be for:
(i) usual hull and machinery marine risks (including crew negligence)
and excess liabilities;
(ii) protection and indemnity risks (including pollution risks and Crew
Insurances); and
(iii) war risks (including protection and indemnity and crew risks) in
accordance with the best practice of prudent owners of vessels of a
similar type to the Vessel, with first class insurance companies,
underwriters or associations ("the Owners' Insurances");
6.2 all premiums and calls on the Owners' Insurances are paid promptly by
their due date,
6.3 the Owners' Insurances name the Managers and, subject to underwriters'
agreement, any third party designated by the Managers as a joint assured,
with full cover, with the Owners obtaining cover in respect of each of the
insurances specified in sub-clause 6.1:
(ii) if reasonably obtainable, on terms such that neither the Managers
nor any such third party shall be under any liability in respect of
premiums or calls arising in connection with the Owners' Insurances;
or
(iii) Indicate alternative (i), (ii) or (iii) in ▇▇▇ ▇▇. If Box 14 is left
blank then (i) applies.
6.4 written evidence is provided, to the reasonable satisfaction of the
Managers, of their compliance with their obligations under Clause 6 within
a reasonable time of the commencement of the Agreement, and of each
renewal date and, if specifically requested, of each payment date of the
Owners' Insurances.
7. INCOME COLLECTED AND EXPENSES PAID ON BEHALF OF OWNERS
7.1 All moneys collected by the Managers under the terms of this
Agreement (other than moneys payable by the Owners to the Managers) and
any interest thereon shall be held to the credit of the Owners in a
separate bank account.
7.2 All expenses incurred by the Managers under the terms of this
Agreement on behalf of the Owners (including expenses as provided in
Clause 8) may be debited against the Owners in the account referred to
under sub-clause 7.1 but shall in any event remain payable by the Owners
to the Managers on demand.
8. MANAGEMENT FEE
8.1 The Owners shall pay to the Managers for their services as Managers
under this Agreement an annual management fee as stated in Box 15 which
shall be payable by equal monthly instalments in advance, the first
instalment being payable on the commencement of this Agreement (see Clause
2 and Box 4) and subsequent instalments being payable every month.
8.2 The management fee shall be subject to review upon mutual agreement.
8.3 The Managers shall, at no extra cost to the Owners, provide their own
office accommodation, office staff, facilities and stationery. Without
limiting the generality of Clause 7 the Owners shall reimburse the
Managers for postage and communication expenses, travelling expenses, and
other out of pocket expenses property incurred by the Managers in
pursuance of the Management Services.
8.4 In the event of the appointment of the Managers being terminated by
the Owners or the Managers in accordance with the provisions of Clauses
17 and 18 other than by reason of default by the Managers, or if the
Vessel is lost, sold or otherwise disposed of, the "management fee"
payable to the Managers according to the provisions of sub-clause 8.1,
shall continue to be payable for a further period of three calendar months
as from the termination date. In addition, provided that the Managers
provide Crew for the Vessel in accordance with sub-clause 3.1:
(i) the Owners shall continue to pay Crew Support Costs during the said
further period of three calendar months and
(ii) the owners shall pay an equitable proportion of any Severance Costs
which may materialize, not exceeding the amount stated in Box 16.
8.5 If the Owners decide to lay-up the Vessel whilst this Agreement
remains in force and such lay-up lasts for more than three months, an
appropriate reduction of the management fee for the period exceeding three
months until one month before the Vessel is again put into service shall
be mutually agreed between the parties.
8.6 Unless otherwise agreed in writing all discounts and commissions
obtained by the Managers in the course of the management of the Vessel
shall be credited to the Owners.
9. BUDGETS AND MANAGEMENT OF FUNDS
9.1 The Managers shall present to the Owners annually a budget for the
following twelve months in such form as the Owners require. The budget for
the first year hereof is set out in Annex "C" hereto. Subsequent annual
budgets shall be prepared by the Managers and submitted to the Owners not
less than three months before the anniversary date of the
PART II
"▇▇▇▇▇▇▇ 98" STANDARD SHIP MANAGEMENT AGREEMENT
commencement of this Agreement (see Clause 2 and Box 4).
9.2 The Owners shall indicate to the Managers their acceptance and
approval of the annual budget within one month of presentation and in the
absence of any such indication the Managers shall be entitled to assume
that the Owners have accepted the proposed budget.
9.3 Following the agreement of the budget, the Managers shall prepare and
present to the Owners their estimate of the working capital requirement of
the Vessel and the Managers shall each month up-date this estimate. Based
thereon, the Managers shall each month request the Owners in writing for
the funds required to run the Vessel for the ensuing month, including the
payment of any occasional or extraordinary item of expenditure, such as
emergency repair costs, additional insurance premiums, bunkers or
provisions. Such funds shall be received by the Managers within ten
running days after the receipt by the Owners of the Managers written
request and shall be held to the credit of the Owners in a separate bank
account.
9.4 The Managers shall produce a comparison between budgeted and actual
income and expenditure of the Vessel in such form as required by the
Owners monthly or at such other intervals as mutually agreed.
9.5 Notwithstanding anything contained herein to the contrary, the
Managers shall in no circumstances be required to use or commit their own
funds to finance the provision of the Management Services.
9.6 Notwithstanding the above, the Owners retain their right to directly
pay any expenses related to the Vessel from their account.
10. MANAGERS' RIGHT TO SUB-CONTRACT
The Managers shall not have the right to sub-contract any of their
obligations hereunder, including those mentioned in sub-clause 3.1,
without the prior written consent of the Owners which shall not be
unreasonably withheld. In the event of such a sub-contract the Managers
shall remain fully liable for the due performance of their obligations
under this Agreement.
11. RESPONSIBILITIES
11.1 FORCE MAJEURE - Neither the Owners nor the Managers shall be under
any liability for any failure to perform any of their obligations
hereunder by reason of any cause whatsoever of any nature or kind beyond
their reasonable control.
11.2 LIABILITY TO OWNERS - (i) Without prejudice to sub-clause 11.1, the
Managers shall be under no liability whatsoever to the Owners for any
loss, damage, delay or expense of whatsoever nature, whether direct or
indirect, (including but not limited to loss of profit arising out of or
in connection with detention of or delay to the Vessel) and howsoever
arising in the course of performance of the Management Services UNLESS
same is proved to have resulted solely from the negligence, gross
negligence or wilful default of the Managers or their employees, or agents
or sub-contractors employed by them in connection with the Vessel, in
which case (save where loss, damage, delay or expense has resulted from
the Managers' personal act or omission committed with the intent to cause
same or recklessly and with knowledge that such loss, damage, delay or
expense would probably result) the Managers' liability for each incident
or series of incidents giving rise to a claim or claims shall never exceed
a total of ten times the annual management fee payable hereunder.
(ii) Notwithstanding anything that may appear to the contrary in this
Agreement, the Managers shall not be liable for any of the actions of
the Crew, even if such actions are negligent, grossly negligent or
wilful, except only to the extent that they are shown to have resulted
from a failure by the Managers to discharge their obligations under
sub-clause 3.1, in which case their liability shall be limited in
accordance with the terms of this Clause 11.
11.3 INDEMNITY - Except to the extent and solely for the amount therein
set out that the Managers would he liable under sub-clause 11.2, the
Owners hereby undertake to keep the Managers and their employees, agents
and sub-contractors indemnified and to hold them harmless against all
actions, proceedings, claims, demands or liabilities whatsoever or
howsoever arising which may be brought against them or incurred or
suffered by them arising out of or in connection with the performance of
the Agreement, and against and in respect of all costs, losses, damages
and expenses (including legal costs and expenses on a full indemnity
basis) which the Managers may suffer or incur (either directly or
indirectly) in the course of the performance of this Agreement.
11.4 "HIMALAYA" - It is hereby expressly agreed that no employee or agent
of the Managers (including every sub-contractor from time to time employed
by the Managers) shall in any circumstances whatsoever be under any
liability whatsoever to the Owners for any loss, damage or delay of
whatsoever kind arising or resulting directly or indirectly from any act,
neglect or default on his part while acting in the course of or in
connection with his employment and, without prejudice to the generality of
the foregoing provisions in this Clause 11, every exemption, limitation,
condition and liberty herein contained and every right, exemption from
liability, defence and immunity of whatsoever nature applicable to the
Managers or to which the Managers are entitled hereunder shall also be
available and shall extend to protect every such employee or agent of the
Managers acting as aforesaid and for the purpose of all the foregoing
provisions of this Clause 11 the Managers are or shall be deemed to be
acting as agent or trustee on behalf of and for the benefit of all
persons who are or might be their servants or agents from time to time
(including sub-contractors as aforesaid) and all such persons shall to
this extent be or be deemed to be parties to this Agreement.
12. DOCUMENTATION
Where the Managers are providing Technical Management in accordance with
sub-clause 3.2 and/or Crew Management in accordance with sub-clause 3.1,
they shall make available, upon Owners' request, all documentation and
records related to the Safety Management System (SMS) and/or the Crew
which the Owners need in order to demonstrate compliance with the ISM Code
and STCW 95 or to defend a claim against a third party.
13. GENERAL ADMINISTRATION
13.1 The Managers shall handle and settle all claims arising out of the
Management Services hereunder and keep the Owners informed regarding any
incident of which the Managers become aware which gives or may give rise
to claims or disputes involving third parties.
13.2 The Managers shall, as instructed by the Owners, bring or defend
actions, suits or proceedings in connection with matters entrusted to the
Managers according to this Agreement.
13.3 The Managers shall also have power to obtain legal or technical or
other outside expert advice in relation to the handling and settlement of
claims and disputes or all other matters affecting the interests of the
Owners in respect of the Vessel.
13.4 The Owners shall arrange for the provision of any necessary guarantee
bond or other security.
13.5 Any costs reasonably incurred by the Managers in carrying out their
obligations according to Clause 13 shall be reimbursed by the Owners.
14. AUDITING
The Managers shall at all times maintain and keep true and correct
accounts and shall make the same available for inspection and auditing by
the Owners at such times as may be mutually agreed. On the termination,
for whatever reasons, of this Agreement, the Managers shall release to
the Owners, if so requested, the originals where possible, or otherwise
certified copies, of all such accounts and all documents specifically
relating to the Vessel and her operation.
15. INSPECTION OF VESSEL
The Owners shall have the right at any time after giving reasonable notice
to the Managers to inspect the Vessel for any reason they consider
necessary.
16. COMPLIANCE WITH LAWS AND REGULATIONS
The Managers will not do or permit to be done anything which might cause
any breach or infringement of the laws and regulations of the Vessel's
flag, or of the places where she trades.
17. DURATION OF THE AGREEMENT
This Agreement shall come into effect on the day and year stated in Box 4
and shall continue until the date stated in Box 17. Thereafter it shall
continue until terminated by either party giving to the other notice in
writing, in which event the Agreement shall
PART II
"▇▇▇▇▇▇▇ 98" STANDARD SHIP MANAGEMENT AGREEMENT
terminate upon the expiration of a period of two months from the date upon
which such notice was given.
18. TERMINATION
18.1 OWNERS' DEFAULT
(i) The Managers shall be entitled to terminate the Agreement with
immediate effect by notice in writing if any moneys payable by the
Owners under this Agreement and/or the owners of any associated
vessel, details of which are listed in Annex "D", shall not have
been received in the Managers' nominated account within ten running
days of receipt by the Owners of the Managers written request or if
the Vessel is repossessed by the Mortgagees.
(ii) If the Owners:
(a) fail to meet their obligations under sub-clauses 5.2 and 5.3
of this Agreement for any reason within their control, or
(b) proceed with the employment of or continue to employ the
Vessel in the carriage of contraband, blockade running, or in
an unlawful trade, or on a voyage which in the reasonable
opinion of the Managers is unduly hazardous or improper,
the Managers may give notice of the default to the Owners, requiring
them to remedy it as soon as practically possible. In the event that
the Owners fail to remedy it within a reasonable time to the
satisfaction of the Managers, the Managers shall be entitled to
terminate the Agreement with immediate effect by notice in writing.
18.2 MANAGERS' DEFAULT
If the Managers fail to meet their obligations under Clauses 3 and 4 of
this Agreement for any reason within the control of the Managers, the
Owners may give notice to the Managers of the default, requiring them to
remedy it as soon as practically possible. In the event that the Managers
fail to remedy it within a reasonable time to the satisfaction of the
Owners, the Owner shall be entitled to terminate the Agreement with
immediate effect by notice in writing.
18.3 EXTRAORDINARY TERMINATION
This Agreement shall be deemed to be terminated in the case of the sale of
the Vessel or if the Vessel becomes a total loss or is declared as a
constructive or compromised or arranged total loss or is requisitioned.
18.4 For the purpose of sub-clause 18.3 hereof
(i) the date upon which the Vessel is to be treated as having been sold
or otherwise disposed of shall be the date on which the Owners cease
to be registered as Owners of the Vessel;
(ii) the Vessel shall not be deemed to be lost unless either she has
become an actual total loss or agreement has been reached with her
underwriters in respect of her constructive, compromised or arranged
total loss or if such agreement with her underwriters is not reached
it is adjudged by a competent tribunal that a constructive loss of
the Vessel has occurred.
18.5 This Agreement shall terminate forthwith in the event of an order
being made or resolution passed for the winding up, dissolution,
liquidation or bankruptcy of either party (otherwise than for the purpose
of reconstruction or amalgamation) or if a receiver is appointed, or if it
suspends payment, ceases to carry on business or makes any special
arrangement or composition with its creditors.
18.6 The termination of this Agreement shall be without prejudice to all
rights accrued due between the parties prior to the date of termination.
19. LAW AND ARBITRATION
19.1 This Agreement shall be governed by and construed in accordance with
English law and any dispute arising out of or in connection with this
Agreement shall be referred to arbitration in London in accordance with
the Arbitration Act 1996 or any statutory modification or re-enactment
thereof save to the extent necessary to give effect to the provisions of
this Clause.
The arbitration shall be conducted in accordance with the London Maritime
Arbitrators Association (LMAA) Terms current at the time when the
arbitration proceedings are commenced.
The reference shall be to three arbitrators. A party wishing to refer a
dispute to arbitration shall appoint its arbitrator and send notice of
such appointment in writing to the other party requiring the other party
to appoint its own arbitrator within 14 calendar days of that notice and
stating that it will appoint its arbitrator as sole arbitrator unless the
other party appoints its own arbitrator and gives notice that it has done
so within the 14 days specified. If the other party does not appoint its
own arbitrator and give notice that it has done so within the 14 days
specified, the party referring a dispute to arbitration may, without the
requirement of any further prior notice to the other party, appoint its
arbitrator as sole arbitrator and shall advise the other party
accordingly. The award of a sole arbitrator shall be binding on both
parties as if he had been appointed by agreement.
Nothing herein shall prevent the parties agreeing in writing to vary these
provisions to provide for the appointment of a sole arbitrator.
In cases where neither the claim nor any counterclaim exceeds the sum of
USD50,000 (or such other sum as the parties may agree) the arbitration
shall be conducted in accordance with the LMAA Small Claims Procedure
current at the time when the arbitration proceedings are commenced.
19.2 This Agreement shall be governed by and construed in accordance with
Title 9 of the United States Code and the Maritime Law of the United
States and any dispute arising out of or in connection with this Agreement
shall be referred to three persons at New York, one to be appointed by
each of the parties hereto, and the third by the two so chosen; their
decision or that of any two of them shall be final, and for the purposes
of enforcing any award, judgement may be entered on an award by any court
of competent jurisdiction. The proceedings shall be conducted in
accordance with the rules of the Society of Maritime Arbitrators, Inc.
In cases where neither the claim nor any counterclaim exceeds the sum of
USD50,000 (or such other sum as the parties may agree) the arbitration
shall be conducted in accordance with the Shortened Arbitration Procedure
of the Society of Maritime Arbitrators, Inc. current at the time when the
arbitration proceedings are commenced.
19.3 This Agreement shall be governed by and construed in accordance with
the laws of the place mutually agreed by the parties and any dispute
arising out of or in connection with this Agreement shall be referred to
arbitration at a mutually agreed place, subject to the procedures
applicable there.
19.4 If Box 18 in Part I is not appropriately filled in, sub-clause 19.1
of this Clause shall apply.
Note: 19.1, 19.2 and 19.3 are alternatives; indicate alternative agreed in
Box 18.
20. NOTICES
20.1 Any notice to be given by either party to the other party shall be in
writing and may be sent by fax, telex, registered or recorded mail or by
personal service.
20.2 The address of the Parties for service of such communication shall be
as stated in Boxes 19 and 20, respectively.
ANNEX "A" (DETAILS OF VESSEL OR VESSELS) TO
THE BALTIC AND INTERNATIONAL MARITIME COUNCIL (BIMCO)
STANDARD SHIP MANAGEMENT AGREEMENT - CODE NAME: "▇▇▇▇▇▇▇ 98"
-------------------------------------------------------------------------------
Date of Agreement: JULY 1, 2004
Name of Vessel(s): M/V "FREE DESTINY"
Particulars of Vessel(s): BUILT 1982
IMO # 8128157
FLAG ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇▇ / ▇▇▇ 9377
ANNEX "B" (DETAILS OF CREW) TO
THE BALTIC AND INTERNATIONAL MARITIME COUNCIL (BIMCO)
STANDARD SHIP MANAGEMENT AGREEMENT - CODE NAME: "▇▇▇▇▇▇▇ 98"
-------------------------------------------------------------------------------
Date of Agreement: JULY 1, 2004
Details of Crew: AT MANAGER'S DISCRETION / AUTHORITY
Numbers Rank Nationality
ANNEX "C" (BUDGET) TO
THE BALTIC AND INTERNATIONAL MARITIME COUNCIL (BIMCO)
STANDARD SHIP MANAGEMENT AGREEMENT - CODE NAME: "▇▇▇▇▇▇▇ 98"
-------------------------------------------------------------------------------
Date of Agreement: 1 JULY 2004
Managers' Budget for the first year with effect from the Commencement Date of
this Agreement
AT MANAGER'S DISCRETION / AUTHORITY
ANNEX "D" (ASSOCIATED VESSELS) TO
THE BALTIC AND INTERNATIONAL MARITIME COUNCIL (BIMCO)
STANDARD SHIP MANAGEMENT AGREEMENT - CODE NAME: "▇▇▇▇▇▇▇ 98"
NOTE: PARTIES SHOULD BE AWARE THAT BY COMPLETING THIS ANNEX "D" THEY WILL BE
SUBJECT TO THE PROVISIONS OF SUB-CLAUSE 18.1(i) OF THIS AGREEMENT.
Date of Agreement: 1 JULY 2004
Details of Associated Vessels: M/V FREE DESTINY
M/V FREE ENVOY