Document:

Exhibit 10.26

 

Confidential
Materials omitted and filed separately with the

Securities and
Exchange Commission.  Asterisks denote
omissions.

 

MICROSPHERES
YIELD IMPROVEMENT PROJECT AGREEMENT

 

This Microspheres Yield Improvement
Project Agreement (the “Agreement”) is
entered into as of December 20, 2007 (the “Effective
Date”) by and between:

 

E. I. du Pont de Nemours and
Company, a company incorporated under the laws of the State of
Delaware, United States of America, and having its principal place of business
at 1007 Market Street, Wilmington, Delaware 19898, USA, (“DuPont”),
and

 

BioSphere Medical, Inc., a company
incorporated under the laws of the State of Delaware, United States of America,
and having its principal place of business at 1050 Hingham Street, Rockland, MA
02370, USA (“BioSphere”).

 

WHEREAS, DuPont is a company engaged in
research regarding specialized particle materials for catheter delivered
embolotherapy;

 

WHEREAS, BioSphere is a company engaged
in the manufacture and sale of Embosphere® and EmboGold® Microspheres for use
in uterine fibroid embolization and peripheral arteriovenous malformations;

 

WHEREAS, the parties have entered into a
Collaboration Agreement of even date herewith (the “Collaboration
Agreement”) that contemplates that the parties will enter into
project agreements for several projects in the field of embolization; and

 

WHEREAS, the parties wish to undertake a
project to test and evaluate the application of DuPont know-how to the
manufacturing of BioSphere’s Embosphere® and EmboGold® Microsphere products in
order to improve the manufacturing yield of such manufacturing processes;

 

NOW, THEREFORE, the parties agree as
follows:

 

1.             DEFINITIONS

 

1.1.          “Affiliate” means any person, any
corporation, limited liability company, partnership or other entity
(collectively, “Person”) that
directly or indirectly controls or is controlled by or is under common control
with such Person.  For this purpose, “control”
means ownership, directly or indirectly through one or more Affiliates, of at
least 50% of the voting stock or other equity interests of the other entity or
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of the entity, whether through the
ownership or control of voting securities, by contract or otherwise.

 

1.2.          “BioSphere Background Intellectual Property”
means all Intellectual Property owned or licensed by BioSphere as of the
Effective Date.

 

1.3.          “BioSphere Manufacturing Process” means
BioSphere’s process or processes for manufacturing the Products existing as of
the Effective Date.

 

1.4.          “Developed Technology” means any and all
inventions, ideas and information, whether or not patentable, conceived and
reduced to practice as a result of the work performed pursuant to the
Project.  Developed Technology shall not
include DuPont Background Intellectual Property or BioSphere Background
Intellectual Property.

 

1.5.          “DuPont Background Intellectual Property”
means all Intellectual Property owned or in-licensed by DuPont as of the
Effective Date, as to which DuPont has the ability at the relevant time to
grant, without incurring expense, nonexclusive licenses

 

 

or nonexclusive
sublicenses respectively, in relation to the technology encompassed by the
Implementation Plan in the Territory.

 

1.6.          “Implementation Plan” means the document
prepared by DuPont upon completion of Phase 4 of the Work Plan (i) specifying
the procedural improvements to the BioSphere Manufacturing Process resulting
from the Project that will bring the average manufacturing yield for the
Product to at least [**] percentage points higher than the Baseline Yield
calculated in accordance with Section 8.3.4 hereof and (ii) identifying
those aspects of the procedural improvements and Developed Technology that may
be appropriate for patenting consideration.

 

1.7.          “Improved-Process Product” means (i) all
Products manufactured by or on behalf of BioSphere or its Affiliates using a
process that incorporates all or some of the procedural improvements specified
in the Implementation Plan and (ii) all micro porous beads manufactured by
or on behalf of BioSphere or its Affiliates using a manufacturing process
substantially similar to the process then used in the manufacture of Products
and incorporating all or some of the procedural improvements specified in the
Implementation Plan.

 

1.8.          “Intellectual Property” means all patents,
patent applications, trade secrets and know-how.

 

1.9.          “Product” means all Embosphere® and
EmboGold® Microspheres manufactured by or on behalf of BioSphere or its
Affiliates.

 

1.10.        “Project” means the research and analysis
conducted by each of the parties in order to improve the average manufacturing
yield of the BioSphere Manufacturing Process to at least [**] percentage points
higher than the Baseline Yield.

 

1.11.        “Project Coordinator” means the
representative designated by each of the parties as set forth in Section 2.2.

 

1.12.        Steering Committee” means a committee established by the
parties in accordance with Section 2.1.

 

1.13.        “Territory” means United States of America,
the member states of the European Union as of the Effective Date, Brazil and
such other countries as identified in writing by BioSphere.

 

1.14.        “Work Plan” means an outline of the tasks
and timelines associated with the Project and an allocation of each party’s
responsibility in relation to the Project attached hereto as Schedule A.

 

2.             STEERING
COMMITTEE AND PROJECT COORDINATORS.

 

2.1.          Steering
Committee.

 

2.1.1.       Composition.  The parties shall establish the Steering
Committee, which shall be comprised of two (2) representatives of each
party.  DuPont’s representatives to the
Steering Committee shall consist of [**] and [**] (or designee(s) of
similar rank).  BioSphere’s
representatives to the Steering Committee shall consist of [**] and [**] (or
designee(s) of similar rank). 
Either party may replace its respective Steering Committee members at
any time, upon written notice to the other party.

 

2.1.2.       Function.  The Steering Committee shall approve any
changes to the Work Plan, attempt to resolve any issues that cannot be resolved
by the 

 

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Project
Coordinators and perform such other tasks as are agreed upon by the parties.

 

2.1.3.       Meetings.  So long as work is being conducted on the
Project hereunder, the Steering Committee, either in person or by telephone,
shall meet upon the reasonable request of either party.  Each party shall be responsible for all
travel and other costs for its representatives to attend any such meetings.

 

2.1.4.       Voting.  Decisions of the Steering Committee shall be
made by unanimous agreement, with each party having a single vote.

 

2.2.          Project
Coordinators.

 

2.2.1.       DuPont’s
Project Coordinator will be [**], and BioSphere’s Project Coordinator will be
[**].  Either party can change its
Project Coordinator during the term of the Agreement by providing written
notice of the identity of its new Project Coordinator to the other party.

 

2.2.2.       The Project
Coordinators will manage the Project in accordance with the Work Plan.  The Project Coordinators shall coordinate the
research and development efforts relating to the Project, serve as primary
communication points between the parties with respect to the Project, and expedite
the progress of work being performed hereunder.

 

2.2.3.       So long as
work is being conducted on the Project hereunder, the Project Coordinators will
meet, either in person or by telephone, at the reasonable request of either
party.

 

3.             RESPONSIBILITIES
AND DUTIES OF THE PARTIES

 

3.1.          DuPont and
BioSphere will use reasonable efforts to complete the activities described in
the Work Plan attached as Schedule A. 
The Work Plan may be amended upon the mutual written consent of the
parties.

 

3.2.          Each party
will use reasonable efforts to provide the services of appropriate personnel
for the activities described in the Work Plan for which it is responsible.  The amount and nature of each party’s
contribution of personnel services will be within the sole discretion of each
party.  In the event that personnel
provided is not directly employed by the party contributing the services of
such personnel, then the party contributing the services of such personnel will
see to it that such personnel is subject to appropriate nondisclosure and
invention assignment agreements prior to beginning any work.

 

3.3.          Each party
will use reasonable efforts to provide appropriate facilities, materials and
information for the activities described in the Work Plan for which it is
responsible.  Except as provided in this
Agreement and the accompanying Work Plan, the amount and nature of each party’s
contribution of facilities, materials and information will be within the
reasonable discretion of each party; provided that such contribution is
sufficient to achieve the purpose of this Agreement.

 

3.4.          The parties
will share with each other data and information collected during the conduct of
the Work Plan.  Following delivery of the
Implementation Plan, DuPont will disclose to BioSphere all Developed
Technology, not previously disclosed, necessary to implement the Implementation
Plan or otherwise exercise 

 

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the licenses granted in Article 7.  The terms of Article 5 will apply to all
disclosures of Confidential Information by the parties.

 

3.5.          After
completion of submission of the Implementation Plan by DuPont as set forth in
the Work Plan, BioSphere will determine, in its sole discretion, whether to
implement any changes to the BioSphere Manufacturing Process set forth in the
Implementation Plan.  BioSphere will
inform DuPont if it intends to implement any portion(s) of the
Implementation Plan in the manufacturing of Product in or for sale in the
Territory as soon as reasonably practicable, but no later than [**] days after
BioSphere has decided to implement such portion of the Implementation Plan.

 

3.6.          Except where
specifically provided in this Agreement and accompanying Work Plan, the parties
will each bear their own costs incurred in connection with the work
hereunder.  The amount and nature of such
costs are within the sole discretion of each party.

 

4.             TERM
AND TERMINATION

 

4.1.          Term.  This Agreement will be effective as of the
Effective Date and will continue thereafter for a period of fifteen (15) years
from the date that BioSphere first implements any portion of the Implementation
Plan in the manufacturing of Improved-Process Product in or for sale in the
Territory.

 

4.2.          Early
Termination by Either Party. 
Prior termination of this Agreement may, however, be made by either
party in writing in the event that:

 

4.2.1.       the other
party commits a breach of the terms of the Agreement, which breach has not been
remedied within fourteen (14) days following notification of the breach; or

 

4.2.2.       the other
party becomes insolvent, appoints a receiver, administrator, liquidator or
other similar officer, has any case or proceeding commenced or other action
taken by or against itself in bankruptcy that is not dismissed within sixty
(60) days of filing, or otherwise commences winding up proceedings.

 

4.3.          Early
Termination by DuPont. 
Notwithstanding the foregoing, DuPont may terminate this Agreement upon
fourteen (14) days’ prior written notice in the event that:

 

4.3.1.       DuPont
determines, in its reasonable discretion after consultation with the Steering
Committee, that the purpose of the Project cannot be achieved;

 

4.3.2.       the parties
have not executed a binding project agreement for another project pursuant to
the Collaboration Agreement within one hundred eighty (180) days after the Effective
Date;

 

4.3.3.       BioSphere
has not informed DuPont, within ninety (90) days after DuPont has provided the
Implementation Plan to BioSphere, that BioSphere intends to implement any
portion of the Implementation Plan in the manufacturing process for Product in
or for sale in the Territory;

 

4.3.4.       BioSphere
has not implemented any portion of the Implementation Plan in the manufacturing
process for Product in or for sale in the Territory within one hundred twenty
(120) days after DuPont has provided the Implementation Plan to BioSphere;

 

4

 

4.3.5.       BioSphere
assigns this Agreement to an Affiliate or to a successor to or purchaser of all
or substantially all of the business or assets of BioSphere or as part of a
reorganization, amalgamation, merger, or change of control of BioSphere; or

 

4.3.6.       there is a
change in ownership of fifty percent
(50%) or more of the ownership or controlling interest (whether in the form of stock
or otherwise) of BioSphere,
or if BioSphere consolidates with or merges into another corporation or entity
or permit one or more other corporations or entities to consolidate or merge
into it;

 

provided that, the termination rights set
forth in Sections 4.3.1, 4.3.2, 4.3.5, and 4.3.6 can only be exercised by
DuPont prior to the delivery of the Implementation Plan.

 

4.4.          Early
Termination by BioSphere. 
Notwithstanding the foregoing, BioSphere may terminate this Agreement,
without financial penalty, upon fourteen (14) days’ prior written notice in the
event that DuPont has not delivered the Implementation Plan within eighteen
(18) months of the Effective Date; provided that such 18-month period shall be
suspended during any delay in delivery of the Implementation Plan that is
caused in whole or in part by BioSphere.

 

4.5.          Effect of
Termination or Expiration. 
Termination will be without prejudice to any other rights or obligations
as may then exist between the parties or any payment obligations that accrued
prior to termination.  On termination or
expiration, all Confidential Information disclosed by one party to the other
will, upon the written request of the disclosing party, be returned by the
recipient to the disclosing party (except as provided in Section 5.6 or
except as necessary to exercise any licenses surviving such termination or
expiration).  The following provisions
will survive termination or expiration of the Agreement:  Section 7.2, Article 4
(Termination); Article 5 (Confidentiality); Article 6 (IP Ownership);
Article 9 (Disclaimers and Limitations); Article 10
(Indemnification); Article 12 (General Provisions) with the exception of
Sections 12.4 and 12.5.

 

5.             CONFIDENTIALITY

 

5.1.          Confidential
Information. 
During the conduct of the Project, the parties will exchange valuable
confidential information and samples which will be disclosed on the following
terms and conditions:

 

5.1.1.       such
information is “Confidential Information” if it is disclosed in writing by the
disclosing party and identified as proprietary or confidential or if it is
otherwise disclosed and identified in writing as proprietary or confidential by
the disclosing party within thirty (30) days of the disclosure;

 

5.1.2.       such samples
are “Confidential Information” if they are delivered by the disclosing party
and identified in writing as proprietary or confidential by the disclosing
party, and information or knowledge obtained by inspection of such samples is “Confidential
Information”;

 

5.1.3.       the terms
and conditions of this Agreement are “Confidential Information” of each party;

 

5.1.4.       the
BioSphere Manufacturing Process is “Confidential Information” of BioSphere;

 

5

 

5.1.5.       all
information learned by one party through visiting the facilities of the other
party, which information would be reasonably understood to be the type of
information that should be treated as proprietary or confidential, is “Confidential
Information” of the party whose facilities are visited; and

 

5.1.6.       the
Implementation Plan will be (i) “Confidential Information” of DuPont prior
to payment of the First Milestone Payment and the Second Milestone Payment and (ii) “Confidential
Information” of BioSphere after payment of the First Milestone Payment and the
Second Milestone Payment. 
Notwithstanding that the Implementation Plan will be deemed “Confidential
Information” of DuPont prior to the payments described in clause (i), at no
time may DuPont use the Implementation Plan except for the purposes of this
Agreement, and, in the event that this Agreement is terminated prior to the
First Milestone Payment and Second Milestone Payment being made, DuPont will
destroy the Implementation Plan immediately following such termination.

 

5.2.          Non-Use and
Confidentiality. 
The receiving party will not use Confidential Information other than for
the purpose of this Agreement and will not disclose Confidential Information to
any third party during the term of the Agreement and for a period of [**] years
after the termination or expiration of the Agreement, without first obtaining
the written agreement from the disclosing party; provided, however, this
obligation will not apply to any information which:

 

5.2.1.       is or
becomes known to the public through no fault of the receiving party;

 

5.2.2.       is known to
the receiving party prior to its receipt from the disclosing party, as shown by
prior written records of the receiving party;

 

5.2.3.       becomes
known to the receiving party by disclosure from a third party who has a lawful
right to disclose the information;

 

5.2.4.       is subsequently
developed by the receiving party independently of the information received from
the disclosing party; or

 

5.2.5.       is required
to be disclosed by order of a court or other government entity of competent
jurisdiction (provided, that the receiving party required to make such
disclosure immediately gives written notice to the disclosing party of its
obligation to make such disclosure and assists the receiving party in obtaining
a protective order and other remedies).

 

5.3.          Restricted
Dissemination. 
Each party agrees to restrict dissemination of Confidential Information
received hereunder from the other party or the other party’s Affiliates only to
those employees who need the Confidential Information in the performance of
work under this Agreement.  Each party
may disclose Confidential Information to its Affiliates provided each party
ensures that such Affiliates abide by the confidentiality provisions of this
Agreement.  Notwithstanding the foregoing
and the exception set forth in Section 5.2.5, unless otherwise agreed in
writing, DuPont shall disclose no Developed Technology in any patent or patent
application filed in the United States or any other national or regional patent
granting authority.

 

5.4.          Samples
Provided to Third Parties. 
Should BioSphere and DuPont jointly decide to provide any sample to, or
have any Product or related material developed under this Agreement tested by,
another party (such as a university or a private company), or to involve
another party in the Project, arrangements will be promptly 

 

6

 

made for appropriate
secrecy agreement(s) to be signed with such party(ies) to protect the
parties’ proprietary rights.

 

5.5.          Permitted
Disclosures. 
Notwithstanding the provisions of this Article 5, either party may
disclose Confidential Information of the other party to the extent such
disclosure:  (a) is required by law
or regulation (including to comply with any applicable securities regulation,
stock exchange or NASDAQ disclosure requirements); provided that the receiving
party shall give the disclosing party prior written notice, shall use
reasonable efforts to limit disclosure, and shall make reasonable efforts to
obtain confidential treatment or a protective order for the disclosure so
ordered; or (b) to any investors, prospective investors, lenders, and
other potential financing sources who are obligated to keep such information
confidential.

 

5.6.          Return of
Confidential Information. 
Upon the written request of the disclosing party, the receiving party
will promptly return all Confidential Information provided to it by the
disclosing party (including all copies and results of all tests); provided,
however, the receiving party may retain one copy of the Confidential
Information in the files of its legal department or attorney in accordance with
the terms of this Agreement to be used only if there is a dispute regarding
compliance with this Agreement.

 

5.7.          Equitable
Relief.  Each party
acknowledges that improper use or disclosure of the Confidential Information of
the other party in violation of this Article 5 would cause substantial
harm to the other party and that such harm could not be remedied by the payment
of damages alone.  Accordingly, each
party will be entitled to preliminary and permanent injunctive relief and other
equitable relief for any breach of this Article 5 by the other party,
without prejudice to all other remedies available at law or in equity.

 

6.             INTELLECTUAL
PROPERTY OWNERSHIP

 

6.1.          Inventorship.  Inventorship of inventions within the
Developed Technology shall be determined in accordance with United States
Patent Law.

 

6.2.          Ownership of
Developed Technology. 
BioSphere shall own, and be free to use without obligation to DuPont,
all Developed Technology.  DuPont shall
treat all Developed Technology as the Confidential Information of BioSphere in
accordance with the obligations of confidentiality set forth in Article 5.

 

6.3.          Assignment
by DuPont.  DuPont agrees to,
and hereby does, and shall cause each of its employees, consultants,
subcontractors, and Affiliates (collectively with DuPont, the “DuPont Assignors”)
to, assign exclusively to BioSphere all right, title, and interest in and to
the Developed Technology conceived by such DuPont Assignors, alone or jointly
with others, including all intellectual property rights associated
therewith.  DuPont hereby appoints, and
shall cause each DuPont Assignor to appoint, BioSphere as such DuPont Assignor’s
attorney-in-fact for the purpose of executing such documents in its name as may
be necessary or desirable to carry out the purposes of this Article, including
to document, enforce, protect, or otherwise perfect BioSphere’s rights in any
Developed Technology, including filing any applicable patent applications.  Upon BioSphere’s request and at BioSphere’s
sole expense, DuPont shall, and shall use commercially reasonable efforts to
cause each DuPont Assignor to, assist BioSphere or anyone BioSphere reasonably
designates in preparing, filing, prosecuting, obtaining, enforcing or defending
any 

 

7

 

application for
Intellectual Property or grant of right issuing therefrom for same in any
country(ies) in the world.

 

7.             LICENSE

 

7.1.          License
Grant.  DuPont hereby
grants to BioSphere an non-exclusive, sublicensable license (or non-exclusive
sublicense, as the case may be) in the Territory under the DuPont Background
Intellectual Property to use, sell, offer for sale, import, make and have made
Improved-Process Products in the Territory. 
Such license (or sublicense) shall be limited to DuPont Background
Intellectual Property necessary or useful for BioSphere to implement changes to
the manufacturing process for the Improved-Process Product set forth in the
Implementation Plan.

 

7.2.          License Upon
Expiration. 
Upon the expiration of this Agreement in accordance with Section 4.1,
BioSphere shall have a fully paid-up, non-exclusive, royalty-free, perpetual,
irrevocable license under the DuPont Background Intellectual Property to use,
sell, offer for sale, import, make and have made Improved-Process Products in
the Territory.

 

8.             COMPENSATION

 

8.1.          Milestone
Payment.

 

8.1.1.       In
consideration of the work and information provided hereunder, BioSphere will
pay DuPont [**] dollars ($[**]) within [**] days after DuPont has provided the
Implementation Plan to BioSphere (the “First
Milestone Payment”).

 

8.1.2.       In further
consideration of the work and information provided hereunder, BioSphere will
pay DuPont an additional [**] dollars ($[**]) within [**] days after
demonstration of the yield improvement at BioSphere’s facility in France as set
forth in Phase 5 of the Work Plan (the “Second
Milestone Payment”).  In the
event that BioSphere has not provided DuPont access to its manufacturing
process and personnel as required in Phase 5 of the Work Plan, the Second
Milestone Payment will be paid [**] days after completion of Phase 4 of the
Work Plan.

 

8.1.3.       The First
Milestone Payment and Second Milestone Payment will be made regardless of
whether BioSphere implements any changes to the manufacturing process for the
Product resulting from the Implementation Plan. 
The First Milestone Payment and Second Milestone Payment are
nonrefundable.  The sum of the First
Milestone Payment and the Second Milestone Payment actually paid will be
credited against the Cost Savings Payments owed by BioSphere pursuant to Section 8.2,
if any, until fully credited.

 

8.2.          Cost Saving
Payments.  In further
consideration of the work and information provided hereunder, BioSphere will pay
to DuPont, every calendar quarter, the Cost Saving Payment, commencing the date
upon which BioSphere first implements any portion of the Implementation Plan in
the manufacturing of Improved-Process Product.

 

8.3.          Applicable
Definitions. 
The following terms will have the definitions set forth below:

 

8

 

8.3.1.       “Actual Cost Per Liter” means the
total cost for all materials, labor and overhead used in or allocated to the
BioSphere Manufacturing Process, as revised to implement any portion of the
Implementation Plan, for the relevant quarterly period divided by the product
of (a) Initial VRAC Liters for such calendar quarter multiplied by (b) the
Actual Yield for such calendar quarter.

 

8.3.2.       “Actual Yield” means the
cumulative number of Final Sieve Accepted Liters that are bottled and accepted
by BioSphere’s quality control division in the relevant calendar quarter
divided by the cumulative number of Initial VRAC Liters started from all lots
in such quarter, with such result expressed as a percent; provided that if an
Initial VRAC Liter is started in one calendar quarter but the related Final
Sieve Accepted Liter is not accepted by BioSphere’s quality control division
until the following calendar quarter, such Initial VRAC Liter shall be deemed
to be started in the following calendar quarter.

 

8.3.3.       “Baseline Cost Per Liter” means the
total cost for all materials, labor and overhead used in or allocated to the
BioSphere Manufacturing Process for the relevant calendar quarter divided by
the product of (a) Initial VRAC Liters for such calendar quarter
multiplied by (b) the Baseline Yield.

 

8.3.4.       “Baseline Yield” means the
cumulative number of Final Sieve Accepted Liters that are bottled and accepted
by BioSphere’s quality control division through the period ending December 31,
2007 divided by the cumulative number of Initial VRAC Liters started for all
lots through the period ended December 31, 2007, with such result
expressed as a percent.  Based on the
yields set forth on Schedule B, the “Baseline Yield” is estimated to be [**]%;
provided that the actual “Baseline Yield” will be calculated by BioSphere and
communicated to DuPont no later than January 31, 2008.

 

8.3.5.       “Cost Saving Payment” means [**]
percent ([**]%) of the Total Cost Saving for any given calendar quarter.

 

8.3.6.       “Cost Savings Per Liter” means the
Baseline Cost Per Liter minus the Actual Cost Per Liter, but the “Cost Savings
Per Liter” may not be less than zero.

 

8.3.7.       “Final Sieve Accepted Liters” means all Product(s) or Improved Process Product(s), as
applicable, that are processed through the final sieve step of the production
process and accepted by BioSphere’s quality control division.

 

8.3.8.       “Initial VRAC Liters” means bulk
microspheres before they are processed through the final sieve step of the
production process.

 

8.3.9.       “Total Cost Saving” means the Cost Savings Per Liter multiplied by actual Final Sieve
Accepted Liters produced during the relevant calendar quarter by or on behalf
of BioSphere or its Affiliates in or for sale in the Territory.

 

For purpose of
making the calculations described in the definitions above, the following shall
apply:  (a) Actual Yield and Actual
Cost Per Liter calculations shall not include any Final Sieve Accepted Liters
processed prior to the date upon which BioSphere first implements any portion
of the Implementation Plan in the manufacturing of Improved-Process Product; (b) all
calculations that are dependent 

 

9

 

on the number
of Final Sieve Accepted Liters will be based on such number of Final Sieve
Accepted Liters that are bottled and accepted by BioSphere’s quality control
division (in accordance with such division’s standard operating procedures); (c) all
calculations that include related Initial VRAC Liters will be based on the
number of Initial VRAC Liters started for the same lot that is ultimately
processed to result in Final Sieve Accepted Liters; (d) all Cost Savings
Payments will be made in U.S. dollars; and (e) the Total Cost Savings will
be calculated in the local currency of the manufacturing facility and converted
to U.S. dollars using the average monthly rate of exchange listed in the New
York edition of The Wall Street Journal
for the calendar quarter prior to the date on which the associated Cost Savings
Payments are made.  By way of
illustration, an example of how the calculations described in the definitions
above would apply is set forth in Schedule C. 
To the extent there are any inconsistencies between Schedule C and the
definitions described above, the definitions described above will govern.

 

8.4.          Timing of
Calculation. 
BioSphere shall calculate and communicate to DuPont the Cost Saving
Payments (and all underlying calculations and components) within [**] days of
the end of each calendar quarter.

 

8.5.          Timing of
Payments.  Cost Saving
Payments will be made every calendar quarter, no later than [**] days after the
calculations of such payments pursuant to Section 8.4.

 

8.6.          Books and
Records/Audit. 
BioSphere will maintain books and records documenting all components of
the Cost Saving Payments, including the liters of Improved-Process Product
manufactured by or on behalf of BioSphere or its Affiliates for sale in the
Territory, in accordance with applicable generally accepted accounting
principles (GAAP).  DuPont, or an
accountant retained by DuPont, may audit such books and records during normal
office hours with at least [**] business days’ notice, but not more than [**]
during any 12-month period.  The costs of
any such audit will be paid by DuPont, unless it is discovered during the
course of such audit that BioSphere underpaid Cost Saving Payments during any
calendar quarter by more than [**]%), in which case BioSphere will reimburse
DuPont for the costs of such audit.

 

8.7.          Interest.  Any Milestone Payment or Cost Saving Payment
that is not timely made will be subject to interest at the then-current Wall
Street Journal Prime Rate, or the maximum interest rate allowed by law.

 

9.             DISCLAIMERS
AND LIMITATIONS

 

9.1.          No Implied
Warranties. 
EXCEPT AS OTHERWISE EXPRESSLY SET FORTH IN THIS AGREEMENT, THE PARTIES
MAKE NO REPRESENTATIONS AND EXTEND NO WARRANTIES OR CONDITIONS OF ANY KIND,
EITHER EXPRESS OR IMPLIED, WITH RESPECT TO THIS AGREEMENT, THE IMPLEMENTATION
PLAN OR THE DEVELOPED TECHNOLOGY, INCLUDING WARRANTIES OF MERCHANTABILITY,
FITNESS FOR A PARTICULAR PURPOSE, INTELLECTUAL PROPERTY FREEDOM TO OPERATE, OR
ANY OTHER EXPRESS OR IMPLIED WARRANTIES, AND ALL SUCH WARRANTIES ARE HEREBY
DISCLAIMED.

 

9.2.          No Guarantee
or Performance Warranty. 
Neither party makes any representation, promise or warranty that the
Project will be successful in whole or in part [**].

 

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9.3.                              Limitations
on Liability. 
EXCEPT FOR A VIOLATION OF ARTICLE 5 OR THE OBLIGATIONS UNDER ARTICLE 10,
IN NO EVENT SHALL EITHER PARTY OR ANY OF THEIR RESPECTIVE AFFILIATES, OR ANY OF
THEIR DIRECTORS, OFFICERS, EMPLOYEES OR AGENTS, BE LIABLE TO THE OTHER PARTY
FOR INCIDENTAL, PUNITIVE, SPECIAL OR CONSEQUENTIAL DAMAGES OF ANY KIND ARISING
HEREUNDER, BASED ON ANY LEGAL THEORY, INCLUDING ECONOMIC DAMAGE, INJURY TO
PROPERTY OR LOST PROFITS, REGARDLESS OF WHETHER A PARTY SHALL BE ADVISED, SHALL
HAVE OTHER REASON TO KNOW, OR IN FACT SHALL KNOW OF THE POSSIBILITY OF ANY OF
THE FOREGOING.

 

9.4.                              Cap on
Damages.  For DuPont, no
claim of any kind, whether or not based on warranty, contract, breach of
warranty or contract, negligence, strict liability, any other tortious act or
omission, or any other theory, arising out of or related to this Agreement, the
Project, the Implementation Plan, the provision of data or information, or the
licensing of DuPont Background Intellectual Property hereunder will be [**].

 

10.            INDEMNIFICATION

 

10.1.                        BioSphere
agrees to Indemnify, defend and hold harmless DuPont, including Affiliates,
officers, directors, employees, and agents thereof (collectively, “Indemnitees”)
from all claims, demands, suits, or actions (including attorneys’ fees incurred
that are reasonable and customary for commensurate type of litigation) asserted
against any Indemnitees for any damages (including compensatory or punitive
damages arising from personal injury, wrongful death, property damage,
incidental or consequential damages), that may be sustained by any third party
or any of the Indemnitees occurring out of or incident to or based on

 

10.1.1.               any alleged
breach of a contractual obligation related to the Project or a BioSphere
product,

 

10.1.2.               any alleged
violation of any statute or regulation related to the Project or a BioSphere
product,

 

10.1.3.               any direct
or consequential costs and damages resulting from any product recall of a
BioSphere product,

 

10.1.4.               tortious
conduct of BioSphere related to the Project or a BioSphere product,

 

including claims of strict liability,
concert of action, conspiracy, third party contractor claims, or allegations of
joint or sole negligence or other tortious conduct; provided, however, that
such indemnity will not apply to the extent of damages proven in a court of law
to be caused by the Indemnitees.

 

10.2.                        In a claim
for indemnity, it will not be required that
DuPont prove that DuPont Technology or Development Technology was used in the
manufacture of the I the BioSphere product (s) at issue.

 

10.3.                        Selection of
Counsel.  BioSphere agrees to
select, within fifteen (15) days from receipt from DuPont of a notice of a
claim requiring representation, counsel reasonably satisfactory to DuPont to
control the defense of any indemnified claim against DuPont; provided that,
upon the request of DuPont, BioSphere and DuPont shall discuss in good faith
whether separate counsel selected by DuPont is necessary to protect DuPont’s
interests.  If the parties agree or, if
they cannot agree,

 

11

 

if DuPont in good faith
determines that separate counsel is so necessary, then DuPont may select
counsel reasonably satisfactory to BioSphere to defend any indemnified claim
against DuPont.  BioSphere will pay the
fees of the counsel selected to defend the indemnified claim against DuPont
and, if separate counsel selected by DuPont is permitted hereunder, the fees of
such separate counsel.

 

10.4.        Notice of
Claims and Duty to Cooperate. 
DuPont will give reasonably prompt notice to BioSphere of its indemnity
claim under this Agreement.  This notice
requirement will not be used to deny indemnity unless there is clear and
convincing proof of substantial prejudice to BioSphere directly resulting from
unreasonable delay in giving notice of an indemnity claim.  All parties to this Agreement will cooperate
in the defense of any such claim.  If
BioSphere in writing accepts the claim for indemnity and provides a defense and
indemnity, then DuPont will not enter into any settlement agreement regarding
such claim without prior written approval of BioSphere.

 

11.                               REPRESENTATIONS
AND COVENANTS

 

11.1.        Mutual
Representations and Warranties. 
Each party hereby represents, warrants and covenants that:

 

11.1.1.               No Conflicts.  As of the Effective Date, the execution,
delivery and performance of the Agreement by such party does not conflict with
any agreement, instrument or understanding, oral or written, to which it is a
party or by which it is bound, nor violate any law or regulation of any court,
governmental body or administrative or other agency having jurisdiction over
it; and

 

11.1.2.               Agents.  All employees or contractors of either party
working on the Project under this Agreement are under an obligation to assign
their rights in all intellectual property developed by them to the respective
employing party; and

 

11.1.3.               Authority.  As of the Effective Date, (i) each party
has full corporate power and authority to execute and deliver this Agreement
and to consummate the transactions contemplated hereby; and (ii) all
corporate acts and other proceedings required to be taken to authorize such
execution, delivery, and consummation (other than contemplated regulatory
approvals) have been duly and properly taken and obtained.

 

11.2.        Representations
of BioSphere. 
BioSphere acknowledges, represents and warrants to DuPont that:

 

11.2.1.               BioSphere is
an experienced manufacturer of the Products.

 

11.2.2.               BioSphere
employs or retains agents and consultants, who are experienced, sophisticated
and knowledgeable in the properties, processing, and hazards of the
manufacturing and use of the Products.

 

11.2.3.               BioSphere
employs or retains regulatory and medical staff properly trained in the
requirements of all applicable laws and regulations (e.g., the Food, Drug and
Cosmetic Act, the Medical Device Amendments thereto) pertaining to the
Products, including materials employed in the Products, and this staff is
competent in conducting safety and efficacy studies and in guiding proper
labeling, use and sale of the Products.

 

12

 

11.2.4.               There are no
pending or threatened claims, actions or litigations relating to the Products,
including product liability, personal injury or intellectual property infringement
claims, pending or threatened governmental investigations, inquiries, fines or
penalties relating to the Products, or pending or threatened recalls in
connection with the Products that are not disclosed in the March 27, 2007
BioSphere Form 10K Annual Statement.

 

11.2.5.               The data
regarding manufacturing yield for the Products provided to DuPont by BioSphere
and attached hereto as Schedule B, is complete and accurate as of the Effective
Date.

 

11.3.        BioSphere
Covenants.  BioSphere covenants
to DuPont that BioSphere will:

 

11.3.1.               will take
all such actions as are needed to comply with all laws and regulations
pertinent to the Products;

 

11.3.2.               assume full
responsibility for providing appropriate warnings to BioSphere end users and
potential BioSphere end users of the Products;

 

11.3.3.               bear all
responsibility, risk and liability for selection of the manufacturing process
and use of materials in the manufacture of the Products;

 

11.3.4.               bear all
responsibility, risk and liability for performing or having performed all
appropriate tests needed to reasonably assure suitability of the manufacturing
processes for the Products and the safety and efficacy of the Products with the
appropriate use warnings;

 

11.3.5.               provide
complete and accurate information regarding the Cost Saving Payment
calculations and all components thereof; and

 

11.3.6.               uphold throughout the term of this Agreement the representations and
covenants made in this Agreement and notify DuPont of any material change to
those representations, as soon as reasonably practicable, but no later than
forty-five (45) days after the change.

 

12.                               GENERAL
PROVISIONS

 

12.1.        Entire
Agreement.  This Agreement sets
forth the entire understanding and agreement between BioSphere and DuPont with
respect to the subject matter hereof, and there are no understandings,
agreements, conditions, or representations, oral or written, expressed or
implied, with reference to the subject matter hereof that are not merged or
superseded hereby.  The provisions of the
Collaboration Agreement do not apply to the Project that is the subject matter
of this Agreement.

 

12.2.        Publicity.  Any news release, public announcement or
statement, advertisement or publicity to be released by any party concerning
the Agreement will be subject to the prior written approval of the other party
prior to release.

 

12.3.        Trademarks,
Trade Names. 
Neither party will use any trade name, trademark, logo or trade dress of
the other party without the other party’s prior written approval.

 

12.4.        Insurance.  Throughout the term of this Agreement,
BioSphere will, at its expense, carry and maintain general liability and
products liability insurance on policy forms and with an insurance company or
companies reasonably acceptable to

 

13

 

DuPont in the amount of
five million dollars ($5,000,000). 
DuPont acknowledges and agrees that an insurance company with an AM Best
Rating of A, VII or higher is an acceptable insurance company.  Such insurance will cover all claims of
bodily injury, death or property damage arising in any way from the work
performed under this Agreement or the products produced or sold by BioSphere
and will name DuPont as an additional insured. 
In the event that the insurance policies are written on a claims-made
basis, BioSphere will use best efforts, to the extent coverage is commercially
available, to keep the policies in force for an extended period of no less than
five (5) years after termination or expiration of this Agreement.  Upon the request of DuPont, BioSphere will
provide DuPont with certificates of insurance evidencing the coverage.  Such certificates will provide that the
insurer will give DuPont at least thirty (30) days advance notice of any
changes in, or cancellation or non-renewal of, coverage and note any
exclusions.

 

12.5.        Manufacturing
Process Review. 
After delivery of the Implementation Plan, during the term of this
Agreement, upon request BioSphere will allow DuPont to access during normal
hours of operation, or gain approval for DuPont to access during normal hours
of operation, all facilities manufacturing Product or Improved-Process Product
for the sole purpose of determining whether BioSphere has implemented any
portion of the Implementation Plan.

 

12.6.        Dispute
Resolution.

 

12.6.1.               The parties
will attempt in good faith to resolve any disputes relating to or arising out
of this Agreement promptly by negotiations between executives who have
authority to settle the dispute.  Either
party may give the other party written notice of any dispute not settled in the
normal course of business.  Within ten (10) days
after delivery of such notice, the receiving party will identify in writing the
name and title of the executive(s) who will represent that party in
negotiations.  As soon as reasonably
practicable but no later than thirty (30) days after delivery of such notice,
the executives of both parties will meet at a mutually acceptable time and
place, and thereafter as often as they reasonably deem necessary, to attempt to
resolve the dispute.  All negotiations
pursuant to this clause will be Confidential Information and will be treated as
compromise and settlement negotiations for purposes of applicable rules of
evidence.

 

12.6.2.               If a dispute
has not been resolved within sixty (60) days after the delivery of the notice
of dispute or if the parties fail to meet within thirty (30) days after the
delivery of the notice of dispute, any dispute arising out of or relating to
this Agreement, including the breach, termination or validity thereof, will be
finally resolved by binding arbitration in accordance with the Commercial Rules of
the American Arbitration Association then currently in effect (the “AAA Rules”), by a sole arbitrator mutually selected by the
parties.  If the parties fail to mutually
select an arbitrator within thirty (30) days after initiation of the
arbitration proceeding, the arbitrator will be selected as provided in the AAA
Rules.  The arbitration will be governed
by the Federal Arbitration Act, 9 U.S.C. §§1-16, and judgment upon the award
rendered by the arbitrator may be entered by any court having jurisdiction
thereof.  The place of the arbitration
will be New York, New York.

 

12.7.                        Notices/Payments.  All notices pertaining to or required by this
Agreement will be in writing and will be signed by an authorized representative
and will be delivered

 

14

 

by hand, sent by
facsimile (with hard copy sent by mail), sent by national overnight courier, or
sent by certified mail, return receipt requested, with postage prepaid,
addressed as follows:

 

If to DuPont:

 

                                                Global
Business Director—BioMedical

DuPont Applied Biosciences

Experimental Station E301/206

Rt. 141 & Henry Clay Drive

Wilmington, DE 19803

Facsimile:  302-695-9696

Telephone: 302-695-7687

 

With copy to:

 

                                                DuPont Legal

Attention: Counsel, Applied Biosciences

1007 Market Street

Wilmington, Delaware 19898

Telephone:  302-774-1000

 

If to BioSphere:

 

BioSphere Medical, Inc.

1050 Hingham Street

Rockland, MA  02370 

Attention:  Richard Faleschini, Chief
Executive Officer

Facsimile:  (781) 982-3028

Telephone:  (781) 681-7920

 

With copy to:

 

Jones Day

222 E. 41st Street

New York, NY  10017 

Attention:  Ann L. Gisolfi, Esq. 

Facsimile:  (212) 755-7306

Telephone:  (212) 326-3595

 

All payments to DuPont required by this
Agreement will be made in U.S. dollars by wire transfer to the following
account with the following information:

 

[**]

 

ABA Routing # [**]

 

Account #: [**]

 

Account Name: [**]

 

Description: [**]

 

15

 

Any party may change such address for
notice or payment by notice given to the other party in the manner set forth
above.  All notices shall be deemed made
upon receipt by the addressee as evidenced by the applicable written receipt or
facsimile transmission.

 

12.8.        Amendments.  Any modification or amendment to this
Agreement will not be effective until a written amendment is signed by all the
parties hereto by their representatives duly authorized to execute such amendments.

 

12.9.        Assignment.  Except as otherwise permitted herein, neither
this Agreement nor any rights or obligations of any party hereunder will be
assigned or otherwise transferred by either party without the prior written
consent of the other party; provided that either party may assign this
Agreement to an Affiliate or to a successor to or purchaser of all or
substantially all of the business or assets of such party or of the business or
assets to which this Agreement relates, or as part of a reorganization,
amalgamation, merger, or change of control of such party.  Any purported assignment in conflict with the
provisions of this paragraph will be deemed null and void.

 

12.10.      License.  Except as specifically set forth herein, no
license or right is granted by implication or otherwise with respect to any
Intellectual Property.

 

12.11.      Waivers.  None of the provisions of this Agreement will
be considered waived by any party hereto unless such waiver is given in writing
to the other party.  The failure of any
party to insist upon strict performance of any of the terms and conditions
hereof, or failure or delay to exercise any rights provided herein or by law,
will not be deemed a waiver of any rights of any party hereto.

 

12.12.      Severability.  The illegality or invalidity of any
provisions of this Agreement will not impair, affect or invalidate the other
provisions of this Agreement.  The
illegality or invalidity of any provision of this Agreement in any individual
country in the Territory will not impair, affect or invalidate any provisions
of the Agreement in other countries in the Territory.

 

12.13.      Force
Majeure.  Neither party will
be responsible to the other for delay or failure in performance of any of the
obligations imposed by this Agreement; provided such delay or failure will be
occasioned by a cause beyond the reasonable control of and without the fault or
negligence of such party, including fire, flood, explosion, lightning,
windstorm, earthquake, subsidence of soil, failure of machinery or equipment or
supply of materials, discontinuity in the supply of power, court order or
governmental interference, civil commotion, riot, war, terrorist attack,
epidemic, strikes, labor disturbances, transportation difficulties or labor
shortage.

 

12.14.      Applicable Law.  This Agreement will be construed in
accordance with and governed by the laws of the State of Delaware, USA, without
reference to any choice of law principles which may direct the application of
the laws of a different jurisdiction.

 

12.15.      Counterparts.  This Agreement may be executed in two (2) or
more counterparts, all of which, taken together, shall constitute one and the
same legal instrument.

 

12.16.      Interpretive
Rules.  For the purposes of
this Agreement, except as otherwise expressly provided herein or unless the
context otherwise requires: (a) defined terms include the plural as well
as the singular, and the use of any gender shall be deemed

 

16

 

to include the other
gender; (b) the use of the term “including” means “including but not
limited to”; (c) the words “herein,” “hereof,” “hereunder” and other words
of similar import refer to this Agreement as a whole and not to any particular
provision; (d) the word “or” is used in the inclusive sense (and/or); (e) the
word “will” shall be construed to have the same meaning and effect as the word “shall”;
and (f) whenever this Agreement refers to a number of days, such number
shall refer to calendar days unless business days are specified.

 

IN WITNESS WHEREOF authorized
representatives of the parties have signed this Agreement as of the date set
forth above.

 

E. I.
du Pont de Nemours and Company

 

 

	
  By:

  	
     /s/
  John Ranier

  	
   

  
	
   

  
	
  Name:

  	
       John
  Ranier

  	
   

  
	
   

  
	
  Title:

  	
         VP/6M
  Applied Biosciences

  	
   

  
	
   

  
	
  BioSphere
  Medical, Inc.

  
	
   

  
	
   

  
	
  By:

  	
     /s/
  Richard J. Faleschini

  	
   

  
	
   

  
	
  Name:

  	
           Richard
  J. Faleschini

  	
   

  
	
   

  
	
  Title:

  	
     President
  and CEO

  	
   

  

 

17

 

Schedule
A

 

WORK
PLAN

 

Yield
Improvement Project

 

[**]

 

Confidential materials omitted
and filed separately with the Securities and Exchange Commission. A total of
two pages have been omitted. [**]

 

 

Schedule
B

 

Embosphere
and EmboGold Manufacturing Yields

 

	
  MS Lot Number

  	
   

  	
  Accepted

  VRAC

  Liters

  	
   

  	
  Final

  Sieve

  Accepted

  Liters

  	
   

  	
  Overall

  Yield%

  
	
  2005

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Total

  	
   

  	
  [**]

  	
   

  	
  [**]

  	
   

  	
  [**]

  
	
  2006

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Total

  	
   

  	
  [**]

  	
   

  	
  [**]

  	
   

  	
  [**]

  
	
  2007

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Sub Total YTD-Q3

  	
   

  	
  [**]

  	
   

  	
  [**]

  	
   

  	
  [**]

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Expected Q4’07

  	
   

  	
  [**]

  	
   

  	
  [**]

  	
   

  	
  [**]

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Expected Full Year 2007
  Baseline Yield

  	
   

  	
  [**]

  	
   

  	
  [**]

  	
   

  	
  [**]

  

 

 

Schedule
C

Cost Saving Payment Calculation

 

For
Illustration Purposes Only

 

	
   

  	
   

  	
  Formula for

  Example 1

  	
   

  	
  Results for

  Example 1

  	
   

  	
  Formula for

  Example 2

  	
   

  	
  Results for

  Example 2

  
	
  Initial VRAC Liters

  	
   

  	
   

  	
   

  	
  [**]

  	
   

  	
   

  	
   

  	
  [**]

  
	
  Final Sieve Accepted Liters for Baseline Yield
  Calculation

  	
   

  	
   

  	
   

  	
  [**]

  	
   

  	
   

  	
   

  	
  [**]

  
	
  Final Sieve Accepted Liters for relevant calendar
  quarter

  	
   

  	
   

  	
   

  	
  [**]

  	
   

  	
   

  	
   

  	
  [**]

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Total materials, labor and overhead costs

  	
   

  	
   

  	
   

  	
  [**]

  	
   

  	
   

  	
   

  	
  [**]

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Baseline Yield

  	
   

  	
  [**]

  	
   

  	
  [**]

  	
   

  	
  [**]

  	
   

  	
  [**]

  
	
  Actual Yield

  	
   

  	
  [**]

  	
   

  	
  [**]

  	
   

  	
  [**]

  	
   

  	
  [**]

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Baseline Cost Per Liter

  	
   

  	
  [**]

  	
   

  	
  [**]

  	
   

  	
  [**]

  	
   

  	
  [**]

  
	
  Actual Cost Per Liter

  	
   

  	
  [**]

  	
   

  	
  [**]

  	
   

  	
  [**]

  	
   

  	
  [**]

  
	
  Cost Savings Per Liter

  	
   

  	
  [**]

  	
   

  	
  [**]

  	
   

  	
  [**]

  	
   

  	
  [**]

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Total Cost Savings Euros

  	
   

  	
  [**]

  	
   

  	
  [**]

  	
   

  	
  [**]

  	
   

  	
  [**]

  
	
  Total Cost Savings USD

  	
   

  	
   

  	
   

  	
  [**]

  	
   

  	
   

  	
   

  	
  [**]

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Cost Saving Payment (to DuPont)

  	
   

  	
  [**]

  	
   

  	
  [**]

  	
   

  	
  [**]

  	
   

  	
  [**]

  

 

[**]Exhibit 4.9

 

	
  MEMORANDUM OF AGREEMENT

   

  	
  Norwegian Shipbrokers’
  Association’s Memorandum

  of Agreement for sale
  and purchase of ships,

  Adopted by The Baltic
  and International Maritime

  Council
  (BIMCO) in 1956.

  Code-name

  SALEFORM 1993

  Revised
  1966, 1983 and 1986/87

  

 

Dated: 24th October, 2007

 

Erik Thun AB, Lidköping,
Sweden, (50%) and B & N Rederi AB, Skärhamn, Sweden, (50%) Jointly (Disponent
Owners: B&N Nordsjöfrakt AB, Skärhamn, Sweden.)

 

	
  hereinafter called the
  Sellers, have agreed to sell, and

  	
  1

  
	
  A company to be nominated and
  guaranteed by Britannia Bulk PLC, London, U.K

  	
   

  
	
  hereinafter called the
  Buyers, have agreed to buy

  	
  2

  
	
   

  	
   

  
	
  Name: m/s “HOLMÖN”

  	
  3

  
	
   

  	
   

  
	
  Classification Society/Class:

  	
   

  
	
  L.R. + 100A1 Strengthened for
  heavy cargoes, Ice Class 1A, + LMC, UMS

  	
  4

  
	
   

  	
   

  
	
  Built:
  1978

  	
  By:
  Kalmar Fartygsreperationr AB,
  Kalmar,  Sweden

  	
  5

  
	
   

  
	
  Flag:
  Swedish

  	
  Place
  of Registration: Skärhamn, Sweden

  	
  6

  
	
   

  	
   

  
	
  Call
  Sign: SKTP

  	
  Grt/Nrt  GT/NT: 8363 / 3987

  	
  7

  
	
   

  	
   

  
	
  Register IMO number :
  7531357

  	
  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 country of the currency

  	
  11

  
	
  stipulated for the Purchase Price in Clause 1 and in
  the place of closing stipulated in Clause 8.

  	
  12

  
	
   

  	
   

  
	
  “In writing” or “written” means a letter handed over
  from the Sellers to the Buyers or vice versa,

  	
  13

  
	
  a registered letter, telex, 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

  
	
   

  	
   

  
	
  $5,700,000 (Five
  Million seven hundred thousand U. S. dollars)

  	
   

  
	
   

  	
   

  
	
  2.        Deposit

  	
  17

  
	
  As security for the correct fulfillment of this
  contract, the Buyers shall pay a deposit of 10% 

  	
  18

  
	
  (ten per cent) of the Purchase Money within 3
  (three) London/New York banking days from the date of

  	
   

  
	
  Buyers counter signing a fax-copy of this

  	
  19

  
	
  agreement and the opening of a joint bank account.
  This deposit shall be placed with Nordea

  	
   

  
	
  Gothenberg, Sweden

  	
  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
  - see also §17.

  	
  25

  
	
   

  	
   

  
	
  The said Purchase Price shall be paid in full free
  of bank charges to Sellers’ account with Nordea

  	
   

  
	
  Gothunberg, Sweden

  	
  26

  
	
  on delivery of the Vessel, but not later than 3
  London/ New York banking days after the Vessel is in all

  	
   

  
	
  every respects

  	
  27

  
	
  physically ready for delivery in accordance with the
  terms and conditions of this Agreement and

  	
  28

  
	
  Notice of the Readiness has been given in accordance
  with Clause 5.

  	
  29

  

 

	
  4.        Inspections

  	
  30

  
	
   

  	
   

  
	
  a)*      The
  Buyers have inspected and accepted the Vessel’s classification records.
  The Buyers

  	
  31

  
	
  have
  also inspected the Vessel at/in  King’s
  North, U.K. on 19th, 20th October, 2007,

  	
  32

  
	
  and
  have accepted the Vessel as she is following this inspection and the sale is
  outright and definite

  	
  33

  
	
  subject
  only to the terms and conditions of this Agreement.

  	
  34

  
	
   

  	
   

  
	
  b)*      The
  Buyers shall have the right to inspect the Vessel’s classification records
  and steel gauging

  	
   

  
	
  measurements which shall not be a subject declare

  	
  35

  
	
  whether
  and same are in any case accepted. or not within.

  	
  36

  
	
   

  	
   

  
	
  The
  Sellers shall provide for inspection of the

  	
  37

  
	
  Vessel
  at/in The Buyers shall undertake the inspection without undue delay to the
  Vessel. Should the

  	
  38

  
	
  Buyers
  cause undue delay they shall compensate the Sellers for the losses thereby
  incurred.

  	
  39

  
	
  The
  Buyers shall inspect the Vessel without opening up and without [ILLEGIBLE] to
  the Sellers.

  	
  40

  
	
  During
  the inspection, the Vessel’s desk and engine log books shall be made
  available for

  	
  41

  
	
  examination
  by the Buyers. If the Vessel is accepted after such inspection the sole shall

  	
  42

  
	
  become
  outright and definite subject only to the terms and conditions of this
  Agreement

  	
  43

  
	
  provided
  the Sellers receive written notice of acceptance from the Buyers within 72
  hours

  	
  44

  
	
  after
  completion of such inspection.

  	
  45

  
	
  Should
  notice of acceptance of the Vessels classification records and of the Vessel
  not be

  	
  46

  
	
  received
  by the Sellers as aforesaid, the deposit together with interest earned shall
  be

  	
  47

  
	
  released
  immediately to the Buyers whereafter this Agreement shall be null and void.

  	
  48

  
	
   

  	
   

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

  	
  49

  
	
  alternative
  4a) to apply

  	
  50

  
	
   

  	
   

  
	
  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 20, 15, 10, 5, 3 and 2 days notice of the estimated time of
  arrival at the

  	
   

  
	
  intended place
  of dry decking /under water inspection/  approximate date of readiness  for delivery.

  	
   

  
	
  When the Vessel
  is at the place

  	
  54

  
	
  of delivery and
  in every all 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

  
	
   

  	
   

  
	
  The Vessel shall
  be delivered and taken over free of
  charter and with clean swept and fresh water

  	
   

  
	
  washed
  holds safely afloat at a safe and always accessible berth
  or

  	
  57

  
	
  encharge
  at/in  a place mutually agreeable
  between Sellers and Buyers,

  	
  58

  
	
  in the Sellers’
  option.

  	
  59

  
	
   

  	
   

  
	
  Expected time of
  delivery within December 2007, and
  January, 2008.

  	
  60

  
	
   

  	
   

  
	
  Date of
  cancelling (see Clauses 5 c), 6 b) (III) and 14) : 31st January, 2008.

  	
  61

  
	
   

  	
   

  
	
  Should the
  Vessel not be ready for delivery by 31st January, 2008, the Buyers
  shall have the right to

  	
   

  
	
  Maintain or
  cancel this agreement . If Buyers elect to cancel then the deposit together
  with any

  	
   

  
	
  Accrued interest
  is to be immediately released to Buyers

  	
   

  
	
   

  	
   

  
	
  b)        If
  the Sellers anticipate that not withstanding the exercise of due diligence by
  them, the

  	
  62

  
	
  Vessel will not
  be ready for delivery by the cancelling 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
  cancelling date . Upon receipt of such notification the Buyers shall have the

  	
  65

  
	
  option of either
  cancelling 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 cancelling 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’
  notification

  	
  69

  
	
  shall be deemed
  to be the new cancelling date and shall be substituted for the cancelling

  	
  70

  
	
  date stipulated
  in line 61.

  	
  71

  
	
   

  	
   

  
	
   

  	
   

  
	
  If this
  Agreement is maintained with the new cancelling date all other terms and
  conditions

  	
  72

  
	
  hereof including
  those contained in Clauses 5 a) and 5 b) 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 cancelling 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

  
	
   

  	
   

  
	
  B.        Drydocking/Divers
  Inspection.- See also §18.

  	
  80

  
	
   

  	
   

  
	
  a)**    The
  Sellers shall place the Vessel in drydock at the port of delivery for
  inspection by the

  	
  81

  
	
  Classification
  Society of the Vessel’s underwater parts below the deepest load line, the

  	
  82

  
	
  extent of the
  inspection being in accordance with the Classification Society’s rules. If
  the

  	
  83

  
	
  rudder,
  propeller, bottom or other underwater parts below the deepest load line are
  found

  	
  84

  
	
  broken, damaged
  or defective so as to effect the Vessel’s class, such defects shall be made

  	
  85

  
	
  good at the
  Sellers’ expense to the satisfaction of the Classification Society without

  	
  86

  
	
  condition/recommendation”.

  	
  87

  
	
   

  	
   

  
	
  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 and with video
  equipment 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 and shall, apart from the Class Surveyor, also
  be attended by Buyers’ and Sellers’

  	
   

  
	
  representatives.
  The Class Surveyor fee shall be for Buyers’ account, however, Sellers
  shall

  	
   

  
	
  appoint
  the Class Surveyor and co-ordinate with Buyers’ appointed diving company
  to achieve

  	
   

  
	
  optimum
  time for the survey. 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 constitute
  a recommendation requiring the

  	
   

  
	
  Vessel
  to drydock immediately  effect 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 without any
  compensation and damages imposed on

  	
   

  
	
  the
  Sellers for the period corresponding to that of the Sellers finding a proper
  drydock, transporting

  	
   

  
	
  the
  Vessel from the port of underwater inspection up to the drydock and making
  and completing the

  	
   

  
	
  required
  repair at the drydock  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 tail shaft 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 tail shaft

  	
  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 tail shaft survey and consistent
  with

  	
  120

  
	
  the current
  stage of the Vessel’s survey cycle. The Buyers shall declare whether they

  	
  121

  
	
  require the tail
  shaft 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 tail shaft shall
  be

  	
  123

  
	
  arranged by the
  Sellers. Should any parts of the tail shaft 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 Seller’s
  expense to the satisfaction of the Classification Society without 

  	
  126

  
	
  condition/recommendation”.

  	
  127

  

 

	
  (ii)       the expenses relating to the survey of
  the tail shaft 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  tail
  shaft 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

  
	
   

  	
   

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

  	
  152

  
	
  alternative 6 a)
  to apply.

  	
  153

  
	
   

  	
   

  
	
  7.        Spares/bunkers,
  etc.

  	
  154

  
	
   

  	
   

  
	
  The Sellers
  shall deliver the Vessel to the Buyers with everything belonging to her on
  board and on

  	
  155

  
	
  Shore and on order. All spare parts and spare
  equipment, including spare tail and shaft(s) and/or spare

  	
  156

  
	
  propeller(s)/
  propeller blade(s), if any, belonging to the Vessel at the time of inspection
  used or

  	
  157

  
	
  unused, whether
  on board or not shall become the Buyers’ property, but spares on order are
  to be

  	
  158

  
	
  excluded.
  Forwarding charges, if any, shall be for the Buyers’ account. The Sellers are
  not required to

  	
  159

  
	
  replace spare
  parts including spare tail and 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. However, all spare parts and spare
  equipment shall be at least to the minimum

  	
   

  
	
  requirements
  of the  Classification Society. All
  communication, wireless and navigational aids, which were 

  	
   

  
	
  on
  board the Vessel at the time of the inspection. The
  radio installation and navigational equipment shall be

  	
   

  
	
  included in the
  sale

  	
  162

  
	
  without extra
  payment if they are the property of the Sellers. Unused  Broached/unbroached stores and

  	
   

  
	
  provisions,
  as well as the Bobcat and spare parts for the Bobcat 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 the

  	
  165

  
	
  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 stop chest are to be excluded from
  the sale,

  	
  168

  
	
  as well as the
  following additional items (including items on hire);

  	
  169

  
	
   

  	
   

  
	
  The Buyers shall
  take over the remaining bunkers and unused lubricating oils in storage tanks
  and

  	
  170

  
	
  broached
  sealed drums, greases and hydraulic
  oils and pay the Sellers’ net cost (purchase) current net

  	
   

  
	
  market
  price (excluding barging expenses) at the port and date  and all prices shall be evidenced by

  	
   

  
	
  original
  invoices.

  	
  171

  
	
  of delivery of
  Vessel,

  	
  172

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

  	
  173

  
	
  the Purchase
  Price.

  	
  174

  

 

	
  8.        Documentation

  	
  175

  
	
  The place of closing: London, U.K.

  	
  176

  
	
   

  	
   

  
	
  In exchange for payment of the Purchase Price the
  Sellers shall furnish the Buyers with delivery

  	
  177

  
	
  documents, namely;  as set out in Addendum no. 1

  	
  178

  
	
   

  	
   

  
	
  a)        Legal
  Bill of Sole in a form recordable in (the country in which the Buyers are

  	
  179

  
	
  to register the
  Vessel), warranting that the Vessel is free from all encumbrances, mortgages

  	
  180

  
	
  and maritime
  liene or any other debts or claims whatsoever, duly materially attested and

  	
  181

  
	
  legalized by the
  council l of such country or other competent authority.

  	
  182

  
	
   

  	
   

  
	
  b)        Current
  Certificate of Ownership issued by the competent authorities of the flag
  state of

  	
  183

  
	
   the Vessel.

  	
  184

  
	
   

  	
   

  
	
  c)        Confirmation
  of Class issued within 72 hours prior to delivery.

  	
  185

  
	
   

  	
   

  
	
  d)        Current
  Certificate issued by the competent authorities stating that the Vessel is
  free from

  	
  186

  
	
  registered
  encumbrances (incorporated in the
  Certificate of Deletion.)

  	
  187

  
	
   

  	
   

  
	
  e)        Certificate
  of Deletion of the Vessel from the Vessel’s registry or other official
  evidence of

  	
  188

  
	
  deletion
  appropriate to the Vessel’s registry at the time of delivery, or, in the
  event that the

  	
  189

  
	
  registry does
  not as matter of practice issue such documentation immediately, a written

  	
  190

  
	
  undertaking by
  the Sellers to affect deletion from the Vessel’s registry forthwith and
  furnish a

  	
  191

  
	
  Certificate or other
  official evidence of deletion to the Buyers promptly and latest within 4

  	
  192

  
	
  (four) weeks
  after the Purchase Price has been paid and the Vessel has been delivered.

  	
  193

  
	
   

  	
   

  
	
  f)         Any
  such additional documents as may reasonably be required by the competent
  authorities

  	
  194

  
	
  for the purpose
  of registering the Vessel provided the Buyers notify the Sellers any such

  	
  195

  
	
  documents as
  soon as possible after the date of this Agreement.

  	
  196

  
	
   

  	
   

  
	
  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 Sellers to the

  	
  198

  
	
  Buyers.

  	
  199

  
	
  At the time of delivery the Sellers shall hand to
  assist the Buyers and provide them
  with all information,

  	
   

  
	
  documents in original and copies
  of certificates as may be required for Buyers’ registration and

  	
   

  
	
  operational purposes, including
  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, plans, manuals,
  drawings, charts

  	
   

  
	
  and instruction books as on board
  which may

  	
  203

  
	
  be in the Sellers’ possession for the main engine, all auxillaries, deck
  machinery, radio and navigational

  	
   

  
	
  equipment and any such items held
  in Sellers’ office shall be released to Buyers at the time of delivery

  	
   

  
	
  pomptly 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

  
	
  Photocopies of all executed
  delivery documents shall be faxed to Buyers well in advance of delivery.

  	
   

  
	
   

  	
   

  
	
  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, any other debts or claims whatsoever as well as arrests, detentions,

  	
   

  
	
  port state control deficiencies,
  taxes and free of slowaways. 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

  
	
  including all port charges
  following delivery, shall be for the Buyers’ account,
  whereas similar charges in

  	
   

  
	
  connection with the closing of the Sellers’

  	
  214

  
	
  register. Sellers’
  crew repatriation and all port charges on arrival and until delivery of the
  Vessel

  	
   

  
	
  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 substantially in the same condition as she was at the time
  of inspection,

  	
   

  
	
  fair wear and tear excepted.

  	
  219

  
	
  However, the Vessel shall be delivered with her present class maintained, without

  	
   

  
	
  condition/recommendation,

  	
  220

  
	
  free of average damage affecting the Vessel’s class,
  with all continuous survey cycles completely
  up

  	
   

  
	
  to date with no outstanding items
  and with all her classification certificates and

  	
  221

  
	
  national certificates, as well as all other
  certificates as required under
  the Vessel’s present flag, clean and

  	
   

  
	
  had at the line of inspection,
  valid and

  	
  222

  
	
  unextended without condition/recommendation by Class or
  the relevant authorities from
  at the time date of

  	
  223

  
	
  delivery.

  	
  224

  
	
   

  	
   

  
	
  “Inspection” in this Clause 11, shall mean the
  Buyers’ inspection according to Clause 4 a) or 4 b), if

  	
  225

  
	
  applicable, or the Buyers’ inspection prior to the
  signing of this Agreement if the Vessel is taken over

  	
  226

  
	
  without inspection, the date of this Agreement shall
  be the relevant date.

  	
  227

  
	
  *         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 tunnel markings.

  	
  231

  
	
   

  	
   

  
	
  13.      Buyer’s 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 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 and for all
  expenses incurred together with 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 the line 61 the Buyers shall have

  	
  242

  
	
  the option of cancelling 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 — see also §20.

  	
  255

  
	
   

  	
   

  
	
  After this Agreement has been signed by both parties
  by fax and the deposit has been
  lodged, the Buyers

  	
  256

  
	
  have the right to place up to two
  representatives on board the Vessel, at their sole risk and expense upon

  	
  257

  
	
  vessel’s arrival at          on
  or about  up to the time
  and place of delivery.

  	
  258

  
	
  These representatives are on board for the purpose
  of familiarisation and in 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
  decision of the

  	
  268

  
	
  single
  arbitrator appointed shall apply. If the arbitrator properly appointed shall
  not agree

  	
  269

  
	
  they
  shall appoint an umpire whose decision shall be final.  Arbitrators shall be appointed by the

  	
  270

  
	
  London Maritime Arbitrators Association and in accordance
  with English law.

  	
   

  
	
   

  	
   

  
	
  b)*      This
  Agreement shall be governed by and construed in accordance with Title 9 of
  the

  	
  271

  
	
  United
  States Code and the Law of the State of New York and should any dispute arise
  out of

  	
  272

  
	
  this
  Agreement, the matter in dispute shall be referred to those persons at New
  York one to 

  	
  273

  
	
  be
  appointed by such  of the parties
  hereto, and the third by the two so chosen their

  	
  274

  
	
  decision
  or that of any two of them shall be final, and for purpose of enforcing any
  award this

  	
  275

  
	
  Agreement
  may be made a rule of the Court.

  	
  276

  
	
  The
  proceedings shall be conducted in accordance with the rules of the Society of
  Maritime

  	
  277

  
	
  Arbitration
  Inc, New York.

  	
  278

  
	
   

  	
   

  
	
  e)*      Any
  dispute arising out of this Agreement shall be referred to arbitration at

  	
  279

  
	
  subject
  to the procedure applicable there.

  	
  281

  
	
   

  	
   

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

  	
  282

  
	
  deletions,
  alternatives 16 a) to apply.

  	
  283

  
	
   

  	
   

  
	
  17.      The cost of meeting room for closing Incl. Communication and
  any incidental costs shall be borne

  	
   

  
	
  equally by Sellers and Buyers.

  	
   

  
	
   

  	
   

  
	
  18.      With reference to §6 of this contract, if any damage is found
  which in the opinion of Class Surveyor

  	
   

  
	
  present at the inspection constitute a recommendation not
  requiring Vessel to drydock until the

  	
   

  
	
  Vessel shall drydock at the next scheduled drydocking,
  then Sellers and Buyers shall apply two

  	
   

  
	
  shipyards mutually agreed in the delivery area for
  quotations for repairs of the said damages. The

  	
   

  
	
  cost to be the direct cost to repair such damage, i.e.: no
  drydocking fees, no off hire, etc.

  	
   

  
	
  The matter it shall be in the Sellers’ option whether to
  repair said damages prior to delivery or deliver the

  	
   

  
	
  recommendation against a reduction in price of the cost of
  repairs, which to be defined as the average of

  	
   

  
	
  the two quotations obtained. If no damage is found by Class Surveyor,
  then the Vessel shall be

  	
   

  
	
  delivered without pre-delivery drydocking.

  	
   

  
	
   

  	
   

  
	
  19.       The Sellers shall provide a letter stating that to
  the best of their knowledge, the Vessel is not blacklisted

  	
   

  
	
  by the Arab Boycott League in Damascus or in any other
  nation or organisation and also to confirm that

  	
   

  
	
  the Vessel is not excluded to trade to and from the U.S.A.
  and Canada and is not contaminated with

  	
   

  
	
  gypsy moth and/or lava and/or eggs and has not previously
  traded to Russian and/or Japanese infected

  	
   

  
	
  ports/areas.

  	
   

  
	
   

  	
   

  
	
  20.      With reference to §15 of this contract, upon Sellers tendering
  the 3 days approximate notice of Vessel’s

  	
   

  
	
  expected readiness to tender the actual Notice of
  Readiness for delivery, the Buyers shall be allowed to

  	
   

  
	
  place a further representative on board and up to 2 other
  crew members to be allowed on board during

  	
   

  
	
  daylight hours, when Sellers crew shall demonstrate and
  familiarise Buyers’ representatives/crew on the

  	
   

  
	
  operation of the Vessel’s equipment, machinery and systems,
  provided there are enough cabins to

  	
   

  
	
  accommodate them and in such case they are at Buyers’ risk
  and expenses.

  	
   

  

 

SIGNED IN DUPLICATE:

 

	
  BUYERS:

  	
   

  	
  SELLERS

  
	
  

  /s/ Cliff Hanson

  	
   

  	
  

  /s/ Ijan Thunbengi

  
	
  MANAGING DIRECTOR

  	
   

  	
  Ijan Thunbengi

  
	
  BRITANNIA BULK, PLC

  	
   

  	
  Jointly
  and severally to both parties.

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00139-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00139-of-00352.parquet"}]]