ex10-3_2.htm


    Exhibit
      10.3.2

     

     

    

     

    
MEMORANDUM
      OF AGREEMENT  Dated: 28th August 2007  Dignity Tanker
      Corporation hereinafter called the Sellers, have agreed to sell, and 1 Double
      Hull Tankers Inc., or Nominee hereinafter called the Buyers, have agreed to
      buy
      2  Name:  Ottoman
      Dignity  3  Classification Society/Class: Det Norske Veritas
      (DNV)  4  Built: 20 November 2000  By: Hyundai
      Heavy Industries, Ulsan, Korea  5  Flag: Marshall
      Island  Place of Registration: Marshall
      Islands  6  Call Sign: TCMQ  Grt/Nrt:
      79,751/48,804  7  IMO
      Number:  9198666  8  hereinafter called the
      Vessel, on the following terms and
      conditions:  9  Definitions  10  “Banking
      days” are days on which banks are open both in
      the  11  United States, Turkey , Germany, Switzerland and
      United Kingdom.  12  “In writing” or “written” means a
      letter handed over from the Sellers to the Buyers or vice versa,  13 a
      registered letter, e-mail, telefax or other modern form of written
      communication.  14  “Classification Society” or “Class”
means the Society referred to in line
      4.  15  1.  Purchase
      Price  16  USD 90,330,000.00 (United States Dollars Ninety
      Million Three Hundred Thirty Thousand) cash on delivery, without any deductions
      into Sellers’ nominated
      bank.  2.  Deposit  17  As security for
      the correct fulfillment of this Agreement the Buyers shall pay a deposit of
      10%  18  (ten percent) of the Purchase Price within 3
      (three) banking days from the time that this Agreement has been  19
      signed by both parties on fax/e-mail exchanges – or from when the escrow account
      is opened, whichever   19 is later.  19 This deposit
      shall be placed with [TBA]  20  and held by them in a joint
      interest bearing account for the Sellers and the Buyers, to be released in
      accordance  21 with joint written instructions of the Sellers and the
      Buyers. Interest, if any, to be credited to the  22 Buyers. Any fee
      charged for holding the said deposit shall be borne equally by the Sellers
      and
      the  23
      Buyers.  24  3.  Payment  25  The
      said Purchase Price shall be paid in full free of bank charges to
      [TBA]  26  on delivery of the Vessel, but not later than 3
      banking days after the Vessel is in every respect  27

     

    
      MEMORANDUM
        OF AGREEMENTDated: 28th August 2007Dignity Tanker Corporation hereinafter
        called
        the Sellers, have agreed to sell, and le Hull Tankers Inc., or Nominee
        hereinafter called the Buyers, have agreed to buy 2Name:  Ottoman
        Dignity  3Classification Society/Class: Det 

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

     

     

    

    
 

    physically
      ready for delivery in accordance with the terms and conditions of this Agreement
      and  28 Notice of Readiness has been given in accordance with Clause
      5.  29  4.  Inspections  30  a)*  The
      Buyers  31 have accepted the Vessel based on an inspection report
      commissioned by OSG Ship  31 Management Inc., carried out at Savona,
      Italy on August 6-7, 2007  32 and the sale is outright and
      definite,  33 subject only to the terms and conditions of this
      Agreement.  34  5.  Notices, time and place of
      delivery  51  a)  The Sellers shall keep the
      Buyers well informed of the Vessel’s itinerary and shall  52 provide
      the Buyers with 30, 21, 14, 7 and 5 days approximate notice of the expected
      date
      of the  53 vessel’s arrival at the  53 intended place of
      delivery and 3, 2, 1 days definite notices of the  54 date Sellers
      expect the vessel to be ready for delivery. When the Vessel is at the
      place  54 of delivery and in every respect physically ready for
      delivery in accordance with this  55 Agreement, the Sellers shall give
      the Buyers a written Notice of Readiness for
      delivery.  56  b)  The Vessel shall be delivered
      and taken over charter free, free of cargo, safely afloat at a
      safe  57 and accessible berth or  57 anchorage in United
      Kingdom Continent or Mediterranean Port  58 in the Sellers’
option.  59  Expected time of delivery:  Between
      December 15, 2007 and February 7, 2008 in Sellers’
option.  60  Date of canceling (see Clauses 5 c), 6 b) (iii)
      and 14): February 7, 2008 in Buyers’
option.  61  c)  If the sellers anticipate that,
      notwithstanding the exercise of due diligence by them, the  62 Vessel
      will not be ready for delivery by the canceling date they may notify the Buyers
      in  63 writing stating the date when they anticipate that the Vessel
      will be ready for delivery and  64 propose a new canceling date. Upon
      receipt of such notification the Buyers shall have the  65 option of
      either canceling this Agreement in accordance with Clause 14 within 7
      running  66 days of receipt of the notice or of accepting the new date
      as the new canceling date. If the  67

     

    


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

     

    

     

    


    Buyers
      have not declared their option within 7 running days of receipt of the
      Sellers’  68 notification or if the Buyers accept the new date, the
      date proposed in the Sellers’  69 notification shall be deemed to be
      the new canceling date and shall be substituted for the canceling  70
      date stipulated in line 61.  71  If this Agreement is
      maintained with the new canceling date all other terms and
      conditions  72 hereof including those contained in Clauses 5 a) and 5
      c) shall remain unaltered and in full  73 force and effect.
      Cancellation or failure to cancel shall be entirely without prejudice to
      any  74 claim for damages the Buyers may have under Clause 14 for the
      Vessel not being ready by  75 the original canceling
      date.  76  d)  Should the Vessel become an actual,
      constructive or compromised total loss before delivery  77 the deposit
      together with interest earned shall be released immediately to the
      Buyers  78 whereafter this Agreement shall be null and
      void.  79  6.  Drydocking/Divers
      Inspection  80  b)**  (i)  The Vessel is
      to be delivered without drydocking. However, the Buyers shall  88 have
      the right at their expense to arrange for an underwater inspection by a diver
      approved 89 by the Classification Society prior to the delivery of the Vessel.
      The Sellers shall at their  90 cost make the Vessel available for such
      inspection. The extent of the inspection and the  91 conditions under
      which it is performed shall be to the satisfaction of the
      Classification  92 Society. If the conditions at the port of delivery
      are unsuitable for such inspection, the  93 Sellers shall make the
      Vessel available at a suitable alternative place near to the
      delivery  94 port.  95  (ii)  If the
      rudder, propeller, bottom or other underwater parts below the deepest load
      line  96 are found broken, damaged or defective so as to affect the
      Vessel’s class, then unless  97 repairs can be carried out afloat to
      the satisfaction of the Classification Society, the Sellers 98 shall arrange
      for
      the Vessel to be drydocked at their expense for inspection by the  99
      Classification Society of the Vessel’s underwater parts below the deepest load
      line, the  100 extent of the inspection being in accordance with the
      Classification Society’s rules. If the  101 rudder, propeller, bottom
      or other underwater parts below the deepest load line are found  102
      broken, damaged or defective so as to affect the Vessel’s class, such defects
      shall be made  103 good by the Sellers at their expense to the
      satisfaction of the Classification Society  104 without
      condition/recommendation*. In such event the Sellers are to pay also for the
      cost of  105 the underwater inspection and the Classification
      Society’s attendance.  106  (iii)  If the Vessel
      is to be drydocked pursuant to Clause 6 b) (ii) and no suitable dry- 107 docking
      facilities are available at the port of delivery, the Sellers shall take the
      Vessel  108 to a port where suitable drydocking facilities are
      available, whether within or outside the  109 delivery range as per
      Clause 5 b). Once drydocking has taken place the Sellers shall
      deliver  110 the Vessel at a port within the delivery range as per
      Clause 5 b) which shall, for the  111 purpose of this Clause, become
      the new port of delivery. In such event the canceling date  112
      provided for in Clause 5 b) shall be extended by the additional time required
      for the  113 drydocking and extra steaming, but limited to a maximum
      of 14 running days.  114  c)  If the Vessel is
      drydocked pursuant to Clause 6 a) or 6 b) above.  115

     

    


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    

     

    


    (i)  the
      Classification Society may require survey of the tailshaft system, the extent
      of  116 the survey being to the satisfaction of the Classification
      surveyor. If such survey is not  117 required by the Classification
      Society, the Buyers shall have the right to require the tailshaft  118
      to be drawn and surveyed by the Classification Society, the extent of the survey
      being in  119 accordance with the Classification Society’s rules for
      tailshaft survey and consistent with  120 the current stage of the
      Vessel’s survey cycle. The Buyers shall declare whether they  121
      require the tailshaft to be drawn and surveyed not later than by the completion
      of the  122 inspection by the Classification Society. The drawing and
      refitting of the tailshaft shall be  123 arranged by the Sellers.
      Should any parts of the tailshaft system be condemned or found  124
      defective so as to affect the Vessel’s class, those parts shall be renewed or
      made good at  125 the Sellers’ expense to the satisfaction of the
      Classification Society without  126
      condition/recommendation*.  127  (ii)  the
      expenses relating to the survey of the tailshaft system shall be
      borne  128 by the Buyers unless the Classification Society requires
      such survey to be carried out, in  129 which case the Sellers shall
      pay these expenses. The Sellers shall also pay the expenses  130 if
      the Buyers require the survey and parts of the system are condemned or found
      defective  131 or broken so as to affect the Vessel’s
      class*.  132  (iii)  the expenses in connection
      with putting the Vessel in and taking her out of  133 drydock,
      including the drydock dues and the Classification Society’s fees shall be paid
      by  134 the Sellers if the Classification Society issues any
      condition/recommendation* as a result  135 of the survey or if it
      requires survey of the tailshaft system. In all other cases the
      Buyers  136 shall pay the aforesaid expenses, dues and
      fees.  137  (iv)  the Buyers’ representative shall
      have the right to be present in the drydock, but  138 without
      interfering with the work or decisions of the Classification
      surveyor.  139  (v)  the buyers shall have the
      right to have the underwater parts of the Vessel  140 cleaned and
      painted at their risk and expense without interfering with the Sellers’ or
      the  141 Classification surveyor’s work, if any, and without affecting
      the Vessel’s timely delivery. If,  142 however, the Buyers’ work in
      drydock is still in progress when the Sellers have  143 completed the
      work which the Sellers are required to do, the additional docking
      time  144 needed to complete the Buyers’ work shall be for the Buyers’
risk and expense. In the event  145 that the Buyers’ work requires
      such additional time, the Sellers may upon completion of the  146
      Sellers’ work tender Notice of Readiness for delivery whilst the Vessel is still
      in drydock  147 and the Buyers shall be obliged to take delivery in
      accordance with Clause 3, whether  148 the Vessel is in drydock or not
      and irrespective of Clause 5 b).  149  *  Notes,
      if any, in the surveyor’s report which are accepted by the Classification
      Society  150 without condition/recommendation are not to be taken into
      account.  151  153  7.  Spares/bunkers,
      etc.  154  The Sellers shall deliver the Vessel to the
      Buyers with everything belonging to her included in the sale, on  155
      board and on  155 shore and on order at the time of physical
      inspection. All spare parts and spare equipment including  156 spare
      tail-end shaft(s) and/or spare  156 propeller(s)/propeller blade(s),
      belonging to the Vessel at the time of inspection used or  157 unused,
      whether on board or not shall become the Buyers’ property.  158
      Forwarding charges, if any, shall be for the Buyers’ account. The Sellers are
      not required to  159 replace spare parts including spare tail-end
      shaft(s) and spare propeller(s)/propeller blade(s) which  160 are
      taken out of spare and used as replacement prior to delivery, but the replaced
      items shall be the  161 property of the Buyers. The radio installation
      and navigational equipment shall be included in the sale  162 without
      extra payment if they are the property of the Sellers. Broached/unbroached
      stores and  163

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    

     

    provisions
      shall be  163 included in the sale and be taken over by the Buyers
      without extra payment.  164  The Sellers have the right to
      take ashore crockery, plates, cutlery, linen and other articles
      bearing  165 the Sellers’ flag or name, provided they replace same
      with similar unmarked items. Library, forms, etc.  166 exclusively for
      use in the Sellers’ vessel(s), shall be excluded without compensation,
      Captain’s,  167 Officers’ and Crew’s personal belongings including the
      slop chest are to be excluded from the sale,  168 as well as the
      following additional items (including items on
      hire):  169  [TBA]   8.  Documentation  175  The
      place of closing: [TBA]  176  In exchange for payment of the
      Purchase Price the Sellers shall furnish the Buyers with delivery  177
      documents, set forth in Exhibit A to this
      Agreement.  178  At the time of delivery the Buyers and
      Sellers shall sign and deliver to each other a Protocol of  197
      Delivery and Acceptance confirming the date and time of delivery of the Vessel
      from the  198 Sellers to the Buyers.  199  At the
      time of delivery the Sellers shall hand to the Buyers the classification
      certificate(s) as well as all  200 plans, etc., which are on board the
      Vessel. Other certificates which are on board the Vessel shall
      also  201 be handed over to the Buyers unless the Sellers are required
      to retain same, in which case the  202 Buyers to have the right to
      take copies. Other technical documentation including plans,
      instruction  203 Books and manuals which are, to the best of
      Sellers’/Managers’ knowledge in English which may  203

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

     

    

     

    be
      in the Sellers’ possession shall be promptly forwarded to the Buyers at their
      expense, if they so  204 request. The Sellers may keep the Vessel’s
      log books but the Buyers to have the right to take  205 copies of
      same.  206  9.  Encumbrances  207  The
      Sellers warrant that the Vessel, at the time of delivery, is free from all
      charters, encumbrances,  208 mortgages and maritime liens or any other
      debts whatsoever. The Sellers hereby undertake  209 to indemnify the
      Buyers against all consequences of claims made against the Vessel which have
      210
      been incurred prior to the time of
      delivery.  211  10.  Taxes,
      etc.  212  Any taxes, fees and expenses in connection with
      the purchase and registration under the Buyers’ flag  213 shall be for
      the Buyers’ account, whereas similar charges in connection with the closing of
      the Sellers’  214 register shall be for the Sellers’
account.  215  11.  Condition on
      delivery  216  The Vessel with everything belonging to her
      shall be at the Sellers’ risk and expense until she is  217 delivered
      to the Buyers, but subject to the terms and conditions of this Agreement she
      shall be 218 delivered and taken over in substantially the same condition as
      she
      was at the time of inspection,  219 fair wear and tear
      excepted.  219  However, the Vessel shall be delivered with
      her class fully maintained without condition/recommendation*,  220
      free of average damage affecting the Vessel’s class, and with her classification
      certificates,  221 as well as all other certificates the Vessel had at
      the time of inspection, clean, valid and  222 unextended without
      condition/recommendation* by Class or the relevant authorities for a minimum
      of
      6 (six)  223 months after the date of delivery. All continuous survey
      cycles to be fully up to date at the time of  223
      delivery.  224  “Inspection” in this Clause 11, shall mean
      the Buyers’ inspection according to Clause 4a) or 4b), if  225
      applicable, or the Buyers’ inspection prior to the signing of this
      Agreement.  226  * Notes, if any, in the surveyor’s report
      which are accepted by the Classification Society  228 without
      condition/recommendation are not to be taken into account.
      229  12.  Name/markings  230  Upon
      delivery the Buyers undertake to change the name of the Vessel and alter funnel
      markings.  231  13.  Buyers’
default  232  Should the deposit not be paid in accordance
      with Clause 2, the Sellers have the right to cancel this  233
      Agreement, and they shall be entitled to claim compensation for their losses
      and
      for all expenses  234 incurred together with 8% (eight percent)
      interest.  235 Should the Purchase Price not be paid in accordance
      with Clause 3, the Sellers have the right to  236 cancel the
      Agreement, in which case the deposit together with interest earned shall be
      released to the 237 Sellers. If the deposit does not cover their loss, the
      Sellers shall be entitled to claim further  238 compensation for their
      losses and for all expenses incurred together with 8% (eight percent)
      interest.  239  14.  Sellers’
default  240

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

     

    

    


    Should
      the Sellers fail to give Notice of Readiness in accordance with Clause 5 a)
      or
      fail to be ready  241 to validly complete a legal transfer by the date
      stipulated in line 61 the Buyers shall have  242 the option of
      canceling this Agreement provided always that the Sellers shall be granted
      a  243 maximum of 3 banking days after Notice of Readiness has been
      given to make arrangements  244 for the documentation set out in
      Clause 8. If after Notice of Readiness has been given but before  245
      the Buyers have taken delivery, the Vessel ceases to be physically ready for
      delivery and is not  246 made physically ready again in every respect
      by the date stipulated in line 61 and new Notice of  247 Readiness
      given, the Buyers shall retain their option to cancel. In the event that the
      Buyers elect  248 to cancel this Agreement the deposit together with
      interest earned shall be released to them  249
      immediately.  250  Should the Sellers fail to give Notice of
      Readiness by the date stipulated in line 61 or fail to be ready  251
      to validly complete a legal transfer as aforesaid they shall make due
      compensation to the Buyers for  252 their loss and for all expenses
      together with interest if their failure is due to proven  253
      negligence and whether or not the Buyers cancel this
      Agreement.  254  15.  Buyers’
representatives  255  After this Agreement has been signed
      by both parties and the deposit has been lodged, the Buyers  256 have
      the right to place two representatives on board the Vessel at their sole risk
      and expense upon  257 arrival at a mutually convenient place earliest
      45 (forty-five) days prior to the intended delivery date.  258 258
      These representatives are on board at Buyers’ risk and expense for the purpose
      of familiarization and in  259 the capacity of  259
      observers only, and they shall not interfere in any respect with the operation
      of the Vessel. The  260 Buyers’ representatives shall sign the
      Sellers’ letter of indemnity prior to their
      embarkation.  261  16.  Arbitration  262  a)*  This
      Agreement shall be governed by and construed in accordance with English law
      and
      263 any dispute arising out of this Agreement shall be referred to arbitration
      in London in  264 accordance with the Arbitration Acts 1950 and 1979
      or any statutory modification or 265 re-enactment thereof for the time being
      in
      force, one arbitrator being appointed by each  266 party. On the
      receipt by one party of the nomination in writing of the other party’s
      arbitrator,  267 that party shall appoint their arbitrator within
      fourteen days, failing which the decision of the  268 single
      arbitrator appointed shall apply. If two arbitrators properly appointed shall
      not agree  269 they shall appoint an umpire whose decision shall be
      final.  270  *  16 a), 16 b) and 16 c) are
      alternatives, delete whichever is not applicable. In the absence
      of  282 deletions, alternative 16 a) to
      apply.  283  Clauses 17 to 19 and Exhibit A inclusive are
      deemed incorporated and considered an integral part of this
      Agreement.

     

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

     

    Clause
      17  This Agreement or any interest herein may not be assigned by
      either party without the prior written consent of the other. Any assignment
      by
      either of the parties hereto in violation of the foregoing sentence shall be
      void. This Agreement may not be modified in any respect except in writing signed
      by both parties and shall be binding upon and shall insure to the benefit of
      the
      parties hereto and their respective successors and assigns.  Clause
      18  If the Buyers shall be unable to accept delivery of the Vessel due
      to outbreak of war, restraint of Government, princes or people or other reasons
      that may be brought about by force majeure, Buyers may terminate this Agreement
      without liability upon either party and in such event the deposit referred
      to in
      Clause 2. of this Agreement shall be released and returned forthwith in full
      to
      the Buyers together with interest.  If the Sellers shall not be able
      to deliver the Vessel due to outbreak of war, restraint of Government, princes
      or people or other reasons that may be brought about by force majeure, Sellers
      may terminate this Agreement without liability upon either party and in such
      event the deposit referred to in Clause 2. of this Agreement shall be released
      and returned forthwith in full to the Buyers together with
      interest.  Clause 19  The parties hereto agree that the
      price, terms, and conditions of this Agreement will not be disclosed until
      it
      may be otherwise mutually agreed, unless such disclosure is required to be
      made
      in order to comply with any law, regulation, order or process binding on either
      of the parties or their respective parents, subsidiaries, agents, directors,
      officers or legal or accounting advisors.  Should, however, details of
      the sale become known or reported in the market, neither the Buyers nor the
      Sellers shall have the right to withdraw from the sale or fail to fulfill their
      obligations under this Agreement.  On behalf of the Sellers: /s/ Mark
      Lamonte Name:  Mark Lamonte Title: Vice President  On behalf
      of the Buyers:  Name: Title.

     

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

     

    

     

    


    EXHIBIT
      A  List of documents to be provided by the Sellers  1. Bill
      of Sale (3 originals) in a form acceptable to the Marshall Islands Maritime
      Authority warranting that the Vessel is free from all encumbrances, mortgages
      and maritime liens or any other debts or claims whatsoever, duly
      notarised;  2. Resolutions or other evidence from the Owners of the
      Vessel authorising the sale of the Vessel and the Memorandum of Agreement
      between the Sellers and the Buyers and inter alia appointing relevant attorneys
      to attend the closing meeting and the physical delivery of the Vessel and to
      sign all relevant documentation including, but not limited to, the Bill of
      Sale,
      the Protocol of Delivery and Acceptance and the deposit release
      letter.  3. Sellers’ Power of Attorney empowering the attorneys to
      attend the closing meeting and the physical delivery of the Vessel and to sign
      all relevant documentation including, but not limited to, the Bill of Sale,
      the
      Protocol of Delivery and Acceptance and the deposit release letter duly
      notarized;  4. Extract from the public commercial registry for the
      Vessel;  5. Copy of Sellers’ Articles of Incorporation and By Laws and
      Incumbency Certificate;  6. Certificate of Ownership and Encumbrances
      issued by the appropriate authorities showing that the Vessel is owned by the
      Sellers and is free of any registered encumbrances dated the date of
      closing;  7. A certificate of deletion from the Vessel’s current
      registry and Marshall Islands permission to transfer of the Vessel to the Buyers
      for re-registration under Marshall Islands flag or Buyers nominated
      flag;  8. Confirmation of class issued within 3 business days prior to
      delivery showing that the Vessel is in class free of any recommendations and
      fit
      to proceed to sea;  9. Copies of all national and international
      trading/classification certificates;  10. Commercial Invoice for the
      Vessel marked “fully paid”;   11. Protocol of Delivery and
      Acceptance;

     

     

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

     

    

    

      12.
        Letter of Undertaking that immediately following payment of the purchase
        money,
        Sellers will instruct their representative on board to physically deliver
        the
        Vessel to the Buyers;  13. All other documents reasonably required by
        the Buyers for registration purposes provided that such requirement is
        communicated within fifteen days prior to the Vessel’s intended date of
        delivery. Buyers to make best efforts to provide the list of the required
        documents as early as possible. [TBA]  14. Certificate of Good
        Standing of Sellers issued by the appropriate authorities.  The Buyers
        or Buyers’ shareholder shall furnish the Sellers with the following
        documents:  15. Minutes of the Meeting of the Board of Directors of
        the Buyers or the Buyers’ shareholders authorising purchase of the Vessel as per
        the MOA from Sellers appointing person(s) to execute the Protocol of Delivery
        and Acceptance and all relevant documents and proceed with delivery formalities
        to be notarized by a Notary Public and Apostiled.  16. Power of
        Attorney of the Buyers or the Buyers’ shareholders, in favour of the Buyers
        empowering person(s) to conduct all matters relating to the purchase of the
        Vessel on behalf of the Buyers, including accept delivery of the Vessel from
        the
        Sellers and release the deposit and pay the balance of the purchase price
        and
        any other money payable to the Sellers, signing the Protocol of Delivery
        and
        Acceptance and attending all relevant matters, to be notarized by a Notary
        Public and Apostiled.