kl08008_ex10-3.htm


    
      

    

     

    Exhibit 10.3

     

     

    
                                                                                           Norwegian Shipbrokers’ Association’s


      MEMORANDUM OF
AGREEMENT                                                                                                                                                                                       
Memorandum of Agreement for sale and 

                                                                                           purchase of ships.  Adopted
by the Baltic 

                                                                                           and
International Maritime Council 

      Dated:
7th
May
2008                                                                        (BIMCO ) in
1956.

                                                              Code-name

                                                                                 SALEFORM 1993

                                                                                           Revised 1966,
1983 and 1986/7

    

     

     

    


    BOCIMAR
INTERNATIONAL N.V.  and DELPHIS N.V.„ hereinafter called the
Sellers, have agreed to sell, and

     

    GENCO CAVALIER
LLC, a Marshall Islands limited liability company fully guaranteed by
Genco Shipping and Trading Limited hereinafter called the Buyers, have agreed to
buy

     

    Name:
M/V CMB
Yangtze

     

    Classification
Society/Class: NIPPON KAIJI
KYOKAI (NKK)

     

    Built:
May
2007                                           By:
Dayang Shipbuilding Co. Ltd

     

    Flag:
Belgian                                               
Place of Registration: Antwerp

     

    Call
Sign:
ONEI                                            
Grt/Nrt: 31261/18291

     

    IMO
Number: 9345817

     

    hereinafter
called the Vessel, on the following terms and conditions:

     

    Definitions

     

    “Banking
Days” are days on which banks are open both in the country of Belgium
and the currency stipulated for the Purchase Price in Clause 1 and in the place
of closing stipulated in Clause 8.

     

    “Charter
Party” is the charter party dated 29th March
2008 between the Sellers and Samsun Logix Corporation of Seoul (the
“Charterers”) which is attached to this Agreement.

     

    “In
writing” or “written” means a letter handed over from the Sellers to the Buyers
or vice versa, a registered letter, e-mail, telefax or other modern form of
written communication.

     

    “Classification
Society” or “Class” means the Society referred to in line 4.

     

    
      	
              1.  

            	
              Purchase
      Price: US$ 74,000,000
      (United States Dollars Seventy Four
  Million)

            


    

     

    
      	
              2.  

            	
              Deposit

            


    

     

    As
security for the correct fulfillment of this Agreement the Buyers shall pay a
deposit of 15% (fifteen per
cent) of the Purchase Price within 3 (three) Banking Days from the date
of the exchange by fax/e-mail of a copy of this Agreement signed by the Sellers
and the Buyers.  This

     

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

     

    deposit
shall be placed with Sellers’
nominated bank, and held by them in a joint interest bearing account for
the Sellers and the Buyers, to be released in accordance with joint written
instructions of the Sellers and the Buyers.  Interest, if any, to be
credited to the Buyers.  Any fee charged for holding/lifting the said
deposit shall be borne equally by the Sellers and the Buyers.

     

    
      	
              3.  

            	
              Payment

            


    

     

    The
Buyers shall lodge the
balance of the Purchase money with the Sellers’ nominated
Bank not later than one banking day prior to the estimated date of delivery of
the Vessel which shall be
released against presentation of a copy of the protocol of delivery and
acceptance signed by the Buyers and Sellers.  The said
Purchase Price shall be paid in full free of bank charges to Sellers’ account on
delivery of the Vessel but not later than 3 banking days after the Vessel is in
all respects physically ready for delivery in accordance with the terms and
conditions of this Agreement and Notice of Readiness has been given in
accordance with Clause 5.

     

    
      	
              4.  

            	
              Inspections

            


    

     

    a)*           The
Buyers have inspected and accepted the Vessel’s Class Records and have waived
their right for inspection.  The Vessel is therefore accepted by the
Buyers and this sale is outright.


     

    and the
sale is outright and definite,

     

    b)
*         The Buyers have also accepted the
Vessel’s classification records.

     

    4
a) and 4b) are alternatives; delete whichever is not applicable.  In
the absence of deletions, alternative 4a) to apply.

     

    
      	
              5.  

            	
              Notices,
      time and place of delivery

            


    

     

    a)           The
Sellers shall provide the Buyers with 45 (fourty five),
30 (thirty), 15 (fifteen) and 5 (five) days approximate notice of the
estimated time of delivery and 1 (one) day
definite notice of delivery.  When the Vessel is at the place
of delivery and in every respect physically ready for delivery in accordance
with this Agreement the Sellers shall give the Buyers a written Notice of
Readiness for delivery.

     

    b)           The
Vessel shall be delivered and taken over safely afloat at a safe and accessible
berth or anchorage at
Sellers’ option

     

    Place or
Yard: see clause 19.

     

    Expected
time of delivery: The Vessel will be delivered to the Buyers upon completion of
the current Charterparty with BHP and concurrently with delivery of the Vessel
to Charterers under the Charterparty – 1st July
-31st July
2008

     

    c)           Date
of cancelling (see clauses 5 c), 6b) (iii) and 14): 1st August
2008

     

     

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

     

    If the
Sellers anticipate that, notwithstanding the exercise of due diligence by them,
the Vessel will not be ready for delivery by the cancelling date they may notify
the Buyers in writing stating the date when they anticipate that the Vessel will
be ready for delivery and propose a new cancelling date.  Upon receipt
of such notification the Buyers shall have the option of either cancelling this
Agreement in accordance with Clause 14 within 7 running days of receipt of the
notice or of accepting the new date as the new cancelling date.  If
the Buyers have not declared their option within 7 running days notification or
if the Buyers accept the new date, the date proposed in the Sellers’
notification shall be deemed to be the new cancelling date and shall be
substituted for the cancelling date stipulated in line 61.

     

    If this
Agreement is maintained with the new cancelling date all other terms and
conditions hereof including those contained in Clauses 5 a) and 5 c) shall
remain unaltered and in full force and effect.  Cancellation or
failure to cancel shall be entirely without prejudice to any claim for damages
the Buyers may have under Clause 14 for the Vessel not being ready by the
original cancelling date.

     

    d)           Should
the Vessel become an actual, constructive or compromised total loss before
delivery the deposit together with interest earned shall be released immediately
to the Buyers whereafter this Agreement shall be null and void.

     

    
      	
              6.  

            	
              Divers
      Inspection

            


    

     

    a)**

     

    b)**       (i)
The Vessel is to be delivered without drydocking.  However, the Buyers
shall have the right at their expense to arrange for an underwater inspection by
a diver approved by the Classification Society as soon as
practicably possible upon arrival at the port of delivery.  The
Sellers shall at their cost make the Vessel available for such
inspection.  The extent of the inspection and the conditions under
which it is performed shall be to the satisfaction of the Classification
Society.  If the conditions at the port of delivery are unsuitable for
such inspection, the Sellers shall make the Vessel available at a suitable
alternative place near to the delivery port.

     

    (ii)           If
the rudder, propeller, bottom or other underwater parts below the deepest load
line are found broken, damaged or defective so as to affect the Vessel’s class,
then unless repairs can be carried out afloat to the satisfaction of the
Classification Society, the Sellers shall arrange for the Vessel to be drydocked
at their expense for inspection by the Classification Society of the Vessel’s
underwater parts below the deepest load line, the extent of the inspection being
in accordance with the Classification Society’s rules.  If the rudder,
propeller, bottom or other underwater parts below the deepest load line are
found broken, damaged or defective so as to affect the Vessel’s class, such
defects shall be made good by the Sellers at their expense to the satisfaction
of the Classification Society without condition/recommendation*.

     

    Should
damage(s) be found to the underwater parts which affect the clean certificate of
class of the Vessel but which in the opinion of the Class surveyor present does
or do not require drydocking prior to the next scheduled drydocking of the
Vessel, the Buyers and the Sellers, if they cannot agree on adequate
compensation, are to apply to 2 (two) reputable ship repairers in P.R. China or
Singapore, 1 (one) to be selected by the Buyers

     

     

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

     

    and
1 (one) to be selected by the Sellers, in order to obtain quotations for the
direct cost to repair the specified damage(s) only.  Thereafter, it
will be at the option of the Sellers whether to repair such damage(s) prior to
delivery or to deliver the Vessel with the said damage(s) against a reduction in
the Purchase Price of the cost of repairs, which are agreed to be defined as the
average of the 2 (two) quotations obtained.  The Classification
Society shall be the sole arbitrator as to whether any damage found may
constitute a condition/recommendation.

     

    (iii)           If
the Vessel is to be drydocked pursuant to Clause 6 b) (ii) and no suitable
dry-docking facilities are available at the port of delivery, the Sellers shall
take the Vessel to a port where suitable drydocking facilities are available,
whether within or outside the delivery range as per Clause 5 b).  Once
drydocking has taken place the Sellers shall deliver the Vessel at the port of
drydocking which shall, for the purpose of this Clause, become the new
port of delivery.

     

    c)           If
the Vessel is drydocked pursuant to Clause 6 b) above

     

    (i)           the
Classification Society may require survey of the tailshaft system, the extent of
the survey being to the satisfaction of the Classification
surveyor.  If such survey is not required by the Classification
Society, the Buyers shall have the right to require the tailshaft to be drawn
and surveyed by the Classification Society, the extent of the survey being in
accordance with the Classification Society’s rules for tailshaft survey and
consistent with the current stage of the Vessel’s survey cycle.  The
Buyers shall declare whether they require the tailshaft to be drawn and surveyed
not later than by the completion of the inspection by the Classification
Society.  The drawing and refitting of the tailshaft shall be arranged
by the Sellers.  Should any parts of the tailshaft system be condemned
or found defective so as to affect the Vessel’s class, those parts shall be
renewed or made good at the Sellers’ expense to the satisfaction of the
Classification Society without condition/recommendation*.

     

    (ii)           the
expenses relating to the survey of the tailshaft system shall be borne by the
Buyers unless the Classification Society requires such survey to be carried out,
in which case the Sellers shall pay these expenses.  The Sellers shall
also pay the expenses if the Buyers require the survey and parts of the system
are condemned or found defective or broken so as to affect the Vessel’s
class*.

     

    (iii)           the
expenses in connection with putting the Vessel in and taking her out of drydock,
including the drydock dues and the Classification Society’s fees shall be paid
by the Sellers if the Classification Society issues any
condition/recommendation* as a result of the survey or if it requires survey of
the tailshaft system.  In all other cases the Buyers shall pay the
aforesaid expenses, dues and fees.

     

    (iv)           the
Buyers’ representative shall have the right to be present in the dry-dock at his
risk, but without interfering with the work or decisions of the Classification
surveyor.

     

    (v)           the
Buyers shall have the right to have the underwater parts of the Vessel cleaned
and painted at their risk and expense without interfering with the Sellers’ or
the Classification surveyor’s work, if any, and without affecting the Vessel’s
timely delivery.  If, however, the Buyers’ work in drydock is still in
progress when the Sellers have completed the work which the

     

     

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    Sellers
are required to do, the additional docking time needed to complete the Buyers’
work shall be for the Buyers’ risk and expense.  In the event that the
Buyers’ work requires such additional time, the Sellers may upon completion of
the Sellers’ work tender Notice of Readiness for delivery whilst the Vessel is
still in drydock and the Buyers shall be obliged to take delivery in accordance
with Clause 3, whether the Vessel is in drydock or not and irrespective of
Clause 5 

     

    b).  Responsibility
for undocking will be for Buyers’ account.

     

    *           Notes,
if any, in the surveyor’s report which are accepted by the Classification
Society without condition/recommendation are not to be taken into
account.

     

    **         6a)
and 6b) are alternatives; delete whichever is not applicable.  In the
absence of deletions, alternative 6a) to apply.

     

    
      	
              7.  

            	
              Spares/bunkers,
      etc.

            


    

     

    The
Sellers shall deliver the Vessel to the Buyers with everything belonging to her
on board and on shore and including spare tail-end shaft(s) and/or spare
propeller(s)/propeller blade(s), if any, belonging to the Vessel used or unused,
whether on board or not shall become the Buyers’ property, but spares on order
are to be excluded.  Forwarding charges, if any, shall be for the
Buyers’ account.  The Sellers are not required to replace spare parts
including spare tail-end shaft(s) and spare propeller(s)/propeller blade(s)
which are taken out of spare and used as replacement prior to delivery, but the
replaced items shall be the property of the Buyers.  The radio
installation and navigational equipment shall be included in the sale without
extra payment if they are the property of the Sellers.  Unused stores
and provisions, if any, shall be included in the sale and be taken over by the
Buyers without extra payment.

     

    The
Sellers have the right to take ashore crockery, plates, cutlery, linen and other
articles bearing the Sellers’ flag or name, provided they replace same with
similar unmarked items.  Library, forms, etc., exclusively for use in
the Sellers’ vessel(s), shall be excluded without
compensation.  Captain’s, Officers’ and Crew’s personal belongings
including the slop chest are to be excluded from the sale, as well as the
following additional items (including items on hire):

     

    Oxygen
and acetylene bottles

     

    Videotel
safety movies

     

    The
Buyers shall take over the remaining bunkers and unused greases
and lubricating oils in tanks and drums as onboard
and pay to the Sellers the
contract price as evidenced by invoices/vouchers.

     

    Payment
under this Clause shall be made at the same time and place and in the same
currency as the Purchase Price.

     

    
      	
              8.  

            	
              Documentation

            


    

     

    The place
of closing: a venue nominated
by the Sellers

     

    In
exchange for payment of the Purchase Price the Sellers shall furnish the Buyers
with satisfactory
documentation reasonably required to effect the registration of the Vessel under


     

     

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    the flag and ownership of the Buyers
to be listed in Addendum to this Agreement.  Such documentation to be
incorporated into an addendum to the MOA.

     

    At the
time of delivery the Buyers and Sellers shall sign and deliver to each other a
Protocol of Delivery and Acceptance confirming the date and time of delivery of
the Vessel from the Sellers to the Buyers.

     

    At the
time of delivery the Sellers shall hand to the Buyers, the classification
certificate(s) as well as plans, etc., which are on board the
Vessel.  Other certificates which are on board the Vessel shall also
be handed over to the Buyers unless the Sellers are required to retain the same,
in which case the Buyers to have the right to take copies.  Other
technical documentation which may be in the Sellers’ possession shall be
promptly forwarded to the Buyers at their expense, if they so
request.  The Sellers may keep the Vessel’s log books but the Buyers
to have the right to take copies of same at Buyers’
costs.

     

    
      	
              9.  

            	
              Encumbrances

            


    

     

    The
Sellers warrant that the Vessel, at the time of delivery, is free from
encumbrances, mortgages and maritime liens or any other debts
whatsoever.  The Sellers hereby undertake to indemnify the Buyers
against all consequences of claims made against the Vessel, which have been
incurred prior to the time of delivery.

     

    
      	
              10.  

            	
              Taxes,
      etc.

            


    

     

    Any
taxes, fees and expenses in connection with the purchase and registration under
the Buyers’ flag shall be for the Buyers’ account, whereas similar charges in
connection with the closing of the Sellers’ register shall be for the Sellers’
account.

     

    
      	
              11.  

            	
              Condition
      on delivery

            


    

     

    The
Vessel with everything belonging to her shall be at the Sellers’ risk and
expense until she is delivered to the Buyers, but subject to the terms and
conditions of this Agreement she shall be delivered and taken over “as is where
is”.

     

    However,
the Vessel shall be delivered with her class maintained without condition/
recommendation except for the Temporary repaired side shell plate IWO No.2 Void
Space in bet. Fr. No. 145-148, SL9-11, (Strake N), free of average damage
affecting the Vessel’s class and with her classification certificates and
national and international certificates, as well as all other certificates the
Vessel had, clean, valid and unextended without condition/recommendation by
Class or the relevant authorities

     

    “Inspection”
in this Clause 11, shall mean the Buyers’ inspection according to Clause 4 a) or
4 b), if applicable, or the Buyers’ inspection prior to the signing of this
Agreement.  If the Vessel is taken over without inspection, the date
of this Agreement shall be the relevant date.

     

    *           Notes,
if any, in the surveyor’s report which are accepted by the Classification
Society without condition/recommendation are not to be taken into
account.

     

     

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

     

     

    
      	
              12.  

            	
              Name/Markings

            


    

     

    Upon
delivery the Buyers undertake to change the name of the Vessel and alter funnel
marking.

     

    
      	
              13.  

            	
              Buyers’
      default

            


    

     

    Should
the deposit not be paid in accordance with Clause 2, the Sellers have the right
to cancel this Agreement, and they shall be entitled to claim compensation for
their losses and for all expenses incurred together with interest.

     

    Should
the Purchase Price not be paid in accordance with Clause 3, the Sellers have the
right to cancel this Agreement, in which case the deposit together with interest
earned shall be released to the Sellers.  If the deposit does not
cover their loss, the Sellers shall be entitled to claim further compensation
for their losses and for all expenses incurred together with
interest.

     

    
      	
              14.  

            	
              Sellers’
      default

            


    

     

    Should
the Sellers fail to give Notice of Readiness in accordance with Clause 5 a) or
fail to be ready to validly complete a legal transfer by the date stipulated in
line 61 the Buyers shall have the option of cancelling this Agreement provided
always that the Sellers shall be granted a maximum of 3 Banking Days after
Notice of Readiness has been given to make arrangements for the documentation
set out in Clause 8.  If after the Notice of Readiness has been given
but before the Buyers have taken delivery, the Vessel ceases to be in all
respects physically ready for delivery and is not made physically ready again in
every respect by the date stipulated in line 61 and new Notice of Readiness is
given, the Buyers shall retain their option to cancel.  In the event
that the Buyers elect to cancel this Agreement the deposit together with
interest earned shall be released to them immediately.

     

    Should
the Sellers fail to give Notice of Readiness by the date stipulated in line 61
or fail to be ready to validly complete a legal transfer as aforesaid they shall
make due compensation to the Buyers for their loss and for all expenses together
with interest if their failure is due to proven negligence and whether or not
the Buyers cancel this Agreement.

     

    
      	
              15.  

            	
              Buyers’
      representatives

            


    

     

    After
this Agreement has been signed by both parties and the deposit has been lodged,
the Buyers have the right to place two representatives on board the Vessel,
as
observers only and without interference with the working of the Vessel,
at their sole risk and expense at the last
loading port in final voyage.  These representatives are on
board for the purpose of familiarisation and in the capacity of observers only,
and they shall not interfere in any respect with the operation of the
Vessel.  The Buyers’ representatives shall sign the Sellers’ letter of
indemnity prior to their embarkation.  Victualling
expenses and communication expenses of Buyers’ representatives are for Buyers’
account and will be paid together with the Purchase Price.

     

    
      	
              16.  

            	
              Arbitration

            


    

     

     

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

     

     

    a)*           This
Agreement shall be governed by and construed in accordance with English law and
any dispute arising out of this Agreement shall be referred to arbitration in
London in accordance with the Arbitration Act 1996 or any statutory
modification or re-enactment thereof for the time being in force, one arbitrator
being appointed by each party.  On the receipt by one party of the
nomination in writing of the other party’s arbitrator, that party shall appoint
their arbitrator within fourteen days, failing which the decision of the single
arbitrator appointed shall apply.  If two arbitrators properly
appointed shall not agree they shall appoint an umpire whose decision shall be
final.

     

    b)*

    


    c)*

    


    *16
a), b) and 16 c) are alternatives; delete whichever is not
applicable.  In the absence of deletions, alternative 16 a) to
apply.

     

    Clause
17

     

    Negotiations
are to be kept strictly private and confidential.  Sellers and Buyers
are public companies and may have to make public announcement of this
transaction, in which case Buyers’–Sellers’ name not to be disclosed without the
prior approval of the Buyers – the Sellers.

     

    Clause
18

     

    The
Buyers are to take over and perform the Charter Party and confirm they have
approved the terms of the Charter Party which is attached to this Agreement and
is to form part of same.  It is understood Buyers will be taking over
this Charter Party in accordance with the terms of a standard novation agreement
(which is to be based on standard wording usually used for this type of
agreement), the consent to whose terms will not be unreasonably
withheld.

     

    Notwithstanding
the above, the Buyers will require that the novation agreement provides that
since Buyers’ interests shall be subject to United States of America (USA) and
United Nations (UN) laws/regulations/sanctions (as amended from time to time)
the Vessel shall not be permitted to trade to any port that would result in any
contravention whatsoever of any of those
laws/regulations/sanctions.

     

    Should
the Charterers refuse to insert wording in the novation agreement having
substantially the same tenor as in the foregoing paragraph so as to conclude the
novation agreement within 14 days after this agreement is signed by both Buyers
and Sellers then this sale is to be considered null and void and the deposit
plus any interest is to be returned to the Buyers.  In such event this
shall not have any bearing whatsoever on the sales of either ‘CMB Aurélie’ or
‘CMB Laetitia’ which are considered as fully independent sales
transactions.

     

    However
should the Charterers refuse to agree on the content of the novation agreement
for reasons others than Buyers’ requirements provided in paragraphs 2 and 3
above, Sellers retain the option to remain in the Charter Party on a
back-to-back basis with Charterers and

     

     

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

     

     

    Buyers.  If
the vessel is chartered back to Sellers, the charterparty will reflect the
Buyers requirements of paragraphs 2 and 3 above.

     

    Clause
19

     

    As
the Buyers interests shall be subject to United States of America (“USA”) and
United Nations (“UN”) laws/regulations/sanctions.  The Sellers shall
not be entitled to deliver the Vessel to the Buyers in any port that would
result in any contravention whatsoever of any of those
laws/regulations/sanctions.  The Buyers represent that the following
countries are subject to USA’s laws/regulations/sanctions: Former Yugoslavia,
Belarus, Burma, Ivory Coast, Cuba, Congo, Iran, Iraq, Liberia, North Korea,
Sudan, Syria, Zimbabawe.

     

    


     

    The
Sellers                                                                                               The Buyers

    


    


    /s/ Benoit
Timmermans                                        /s/ Robert Gerald
Buchanan                   


    For and
on behalf
of                                                                                             For and on behalf
of

    BOCIMAR
INTERNATIONAL NV /DELPHIS
NV                                               GENCO
CAVALIER LLC

    Name:  Benoit
Timmermans                                
Name: Robert G. Buchanan

    Title:  Director                                                                                               Title:
Manager

                                                                                                                                            
9th
May 2008 


     

     

     

    


     

    9