Exhibit 10.7
Transaction No. 1192-L01-01
BAREBOAT CHARTER AND OPTION TO PURCHASE
of the Casino Cruise Ship
EMPRESS II
THIS BAREBOAT CHARTER and Option to Purchase (hereinafter "Charter") made
and entered into as of July 6, 2004 by and between Cruise Holdings II, LLC, a
Nevada limited liability company (hereinafter Owner), with an office and place
of business at 0000 XxXxxx Xxxxx, Xxx Xxxxx, Xxxxxx 00000, owner of the casino
cruise ship EMPRESS II, United States Official Number 998517 (hereinafter the
"Vessel"), and Palm Beach Empress Inc., a Delaware corporation ("PBE"), with an
office and place of business at Xxx Xxxx 00xx Xxxxxx, Xxxxx 000, Xxxxxxx Xxxxx,
Xxxxxxx 00000 and Palm Beach Maritime Corporation, formerly named MJQ
Corporation, a Delaware corporation ("MJQ"), with an office and place of
business at Xxx Xxxx 00xx Xxxxxx, Xxxxx 000, Xxxxxxx Xxxxx, Xxxxxxx 00000,
jointly and severally as Charterer (PBE and MJQ are hereinafter individually and
collectively referred to as, the "Charterer"). The Owner, as Lessor, and
Charterer, as Lessee, are also parties to that certain Master Lease ("Master
Lease") of even date herewith, wherein Owner agrees to lease the Vessel to
Charterer and Charterer agrees to lease the Vessel from Owner. The terms and
provisions of the Master Lease are hereby incorporated herein by reference;
provided, however, in the event of any conflict between any provisions of the
Master Lease and this Charter, the provisions of this Charter shall control.
W I T N E S S E T H:
NOW THEREFORE, upon the terms and conditions hereinafter set forth, Owner
agrees to charter and Charterer agrees to accept under charter the Vessel.
ARTICLE 1
DESCRIPTION OF VESSEL
The Vessel is a United States registered vessel (official number 998517),
more particularly
described in Appendix A attached hereto.
ARTICLE 2
PERIOD OF CHARTER
A. The period of this Charter shall be for five (5) years (hereinafter the
"Original Period") from the date of delivery as hereinafter provided. This
Charter shall automatically supercede and terminate any existing bareboat
charter of the Vessel, including without limitation that certain bareboat
charter between Charterer and ITG Vegas, Inc., a Nevada corporation ("ITG
Vegas").
B. At the end of the Charter Period, provided no payment default by
Charterer exists hereunder, Owner agrees to deliver title to the Vessel to
Charterer pursuant to the terms and conditions set out in Article 19 hereof.
ARTICLE 3
MONTHLY CHARTER HIRE
A. The Charterer shall pay charter hire("Charter Hire") monthly in arrears
on or before the first day of each calendar month commencing on the first day of
the first month following the date of delivery and continuing thereafter for a
period of twelve (12) months at the rate of Eighty-Two Thousand Six Hundred
Ninety-Five Dollars (US$82,695.00) per month, and the first day of each calendar
month thereafter for forty-eight (48) consecutive months until termination of
the Charter as provided herein at the rate of One Hundred Seventy-One Thousand
Seven Hundred Two and 54/100ths Dollars (US$171,702.54) per month or pro rata
for any part of a month. Any Charter Hire paid in advance and not earned shall
be promptly refunded to the Charterer by Owner, including any unearned Charter
Hire paid in advance during the month in which the Vessel may be sold to the
Charterer. Payment of Charter Hire shall be made to the Owner by electronic
funds transfer as directed by Owner or, if no directions are given by Owner, to
the Owner at 0000 XxXxxx Xxxxx, Xxx Xxxxx, Xxxxxx 00000, and shall be deemed
paid when it is received by the Owner. The first monthly Charter Hire payment
shall be made, pro rata, on the first day of the first month following the date
of delivery and all subsequent payments shall be made on or before the first day
of each calendar month thereafter.
The amounts of Charter Hire set forth in the first paragraph of this
Article 3A is derived from an
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amortization table set forth in Schedule A-1 to the Master Lease I ("Schedule"),
incorporated herein by reference, which is and, insofar as it may be modified in
accordance herewith shall be, determined based upon an original principal amount
of $6 million with interest at 16.54%, payable initially in sixty (60)
consecutive installments, payable monthly in arrears on the first day of each
calendar month, in level payments the first twelve (12) of which shall be in the
amount of $82,695 and the next forty-eight (48) of which shall be in the amount
of $171,702.54; provided, however, that the first payment shall be adjusted pro
rata based upon the number of days from the date hereof through and including
July 31, 2004. Beginning July 15, 2005, Charterer shall have the right to prepay
the Charter Hire hereunder by paying the Casualty Value as set forth in the
Schedule, representing a premium of seven percent (7%) if prepaid on or after
July 15, 2005 and before July 15, 2006, five percent (5%) if prepaid on or after
July 15, 2006 and before July 15, 2007, three (3%) if prepaid on or after July
15, 2007 and before July 15, 2008, and without premium if prepaid on or after
July 15, 2008. Ninety-Seven percent (97%) of all Cash Flow Sweep (as defined in
Article 3B below) payments made before July 15, 2008, and one hundred percent
(100%) of such payments made thereafter, shall be applied to the principal
portion of the Casualty Value and to the principal portion of installments of
Charter Hire in the inverse order of the maturities thereof. The level amount of
each installment of Charter Hire set forth herein shall continue notwithstanding
any prepayment or Cash Flow Sweep payment, with the result that the number of
payments required to pay the entire Casualty Value or Charter Hire shall be
reduced. With each prepayment and each Cash Flow Sweep payment, the Schedule
shall be modified to reflect a new amortization schedule reflecting the adjusted
Casualty Value and the portion thereof representing principal. Owner shall,
within five (5) business days after the date of any partial prepayment or Cash
Flow Sweep payment, provide to Charterer a new amortization schedule with
Casualty Values and showing the principal portion thereof in the form of a
proposed amendment to the Schedule. Charterer shall have five (5) business days
from the date of receipt thereof to notify Owner, in writing, of its
disagreement with any amounts shown therein. If Charterer fails to notify Owner
of its disagreement as to the amendment to the Schedule, then the amendment to
the Schedule submitted by Owner shall be deemed correct and binding upon the
parties hereto. If Charterer notifies Owner within such five (5) business day
period that it disagrees with the amended Schedule provided by Owner, and the
parties are not able to resolve such disagreement, at the request of either
party,
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the parties shall retain a mutually agreed upon independent certified public
accounting firm to recalculate the amortization schedule and Casualty Values
(and showing the principal portion thereof) to be attached as the amendment to
the Schedule, which shall be final, conclusive and binding upon the parties.
Once the Casualty Value in effect hereunder is reduced to zero, no further
payments of Charter Hire shall be payable hereunder. Any amendment to the
Schedule approved by the parties in accordance with this Section 3.A shall
supercede any previous schedule, and in the event the provisions of any
amendment to the Schedule conflict with the provisions of any prior Schedule,
the provisions of the amended Schedule shall control.
Owner is on this date depositing $6 million into blocked bank account no.
00000000 with Silver State Bank (the "Blocked Account"), the funds from which
are to be released from time to time to PBE for purposes of paying expenses
incurred in refurbishing the Vessel and preparing the Vessel for its inaugural
voyage, all subject to the terms of that certain Blocked Account Agreement of
even date herewith among PBE, Owner, Silver State Bank, PDS-Funding 2004-A LLC
and others. To the extent less than $6 million is released from the Blocked
Account to PBE pursuant to such Blocked Account Agreement, such deficiency shall
be applied to reduce the principal portion of the Casualty Value and the
installments of Charter Hire in the inverse order of their maturities, with the
same effect (including but not limited to the need for an amendment to Schedule
I hereto) as set forth in the immediately preceding paragraph.
B. In addition to the monthly Charter Hire, Charterer shall make an annual
payment that will be credited against the Purchase Option Exercise Price and
also against installments of Charter Hire, as set forth in this Article 3.B
("Cash Flow Sweep"). The amount of the annual Cash Flow Sweep payment shall be
determined by multiplying the Cash Flow Sweep Percentage, defined below, to an
amount equal to the combined annual EBITDA (earnings before interest, tax,
depreciation and amortization) with respect to the Vessel and a second vessel,
the PALM BEACH PRINCESS (Panama No. 14348-84-E and IMO No. 8402937)(the "Second
Vessel"), operated by Charterer or, by way of a sub-demise charter(s), ITG
Vegas, or ITG Palm Beach, LLC, a Delaware limited liability company ("ITG Palm
Beach"), for the prior fiscal year less Capital Expenditures, as defined herein,
and less, to the extent not otherwise expensed or deducted, any "Additional
Payments" under and as defined in Articles 3.B and 19.B of the two Sub-Charters
of even date herewith between Charterer, ITG Palm Beach and ITG Vegas, but
without regard to any Cash Flow Sweep payments. The initial fiscal year shall
commence on July 1, 2004. The Cash Flow
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Sweep calculation shall be based upon the annual audited financial statements
provided by each Charterer or ITG Vegas or other operator of the Vessel and the
Second Vessel to Owner within ninety (90) days of fiscal year-end. Owner shall
submit to Charterer the calculation of the amount of Cash Flow Sweep payment due
to Owner within five (5) days of Owner's receipt of annual audited financial
statements from each Charterer or ITG Vegas. "Capital Expenditures" means an
amount equal to four percent (4%) of the net operating revenue resulting from
the operations of the Vessel and the Second Vessel. The Cash Flow Sweep
Percentage will be determined based on the annual EBITDAR (earnings before
interest, taxes, depreciation, amortization and rents) generated by and from the
Vessel and the Second Vessel, as reflected in accordance with generally accepted
accounting principles then in effect in the United States, in the financial
statements provided to Owner by Charterer or ITG Vegas, as follows (all amounts
in millions of dollars):
------------------------------ -------------------------------------------------
EBITDAR Cash Flow Sweep Percentage of EBITDA less
Capital Expenditures
------------------------------ -------------------------------------------------
More than $10.0 None
------------------------------ -------------------------------------------------
Between $8.0 and $10.0 15% (fifteen percent)
------------------------------ -------------------------------------------------
Less than $8.0 30% (thirty percent)
------------------------------ -------------------------------------------------
The Cash Flow Sweep payment shall be due to Owner on the later of the fifteenth
(15th) day after the end of the first quarter of the following fiscal year or
fifteen (15) days after the submission by Owner to Charterer of the statement of
the amount of Cash Flow Sweep payment due to Owner.
C. At the end of each quarter of the current fiscal year, Charterer shall
provide a year-to-date calculation of EBITDAR, annualized based on seasonality
factors provided by Owner and attached as Exhibit A ("Annualized EBITDAR").
Based upon the product of Annualized EBITDAR and 10/12ths ("YTD Result"),
Charterer agrees to deposit the following percentage of year-to-date EBITDA
("YTD EBITDA" and such percentage, the "Escrow Amount") into an account (the
"Cashflow Account") for the benefit of Owner, in accordance with that certain
Account Agreement of even date herewith among Charterer, Owner, Cruise Holdings
I, LLC, a Nevada limited liability company and SILVER STATE BANK, a Nevada State
chartered banking corporation ("Silver State"):
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-------------------------------------------------- ---------------------------
YTD RESULT ESCROW AMOUNT
-------------------------------------------------- ---------------------------
YTD Result is less than $10 Million, but greater 50% of YTD EBITDA
than $8 Million
-------------------------------------------------- ---------------------------
YTD Result is less than $8 Million 100% of YTD EBITDA
-------------------------------------------------- ---------------------------
YTD Result is greater than $10 Million NONE
-------------------------------------------------- ---------------------------
The applicable Escrow Amount shall be paid to the Cashflow Account on or before
the fifteenth (15th) day after the end of the respective quarter of the then
current fiscal year. At the end of each subsequent quarter of the applicable
fiscal year, if the YTD Result is greater than $10,000,000.00, all funds in the
Cashflow Account, if any, shall be remitted to ITG Vegas for the account of
Charterer; and if the YTD Result is between $8,000,000.00 and $10,000,000.00,
any amount previously deposited in the Cashflow Account in excess of 50% of YTD
EBITDA will be remitted to ITG Vegas for the account of Charterer. At the end of
each fiscal year, any funds held in the Cashflow Account pursuant to this
paragraph 3.C. shall be applied to any Cash Flow Sweep payment due under
paragraph 3.B., above. Owner and Charterer acknowledge and agree that the Escrow
Amount shall be determined for each fiscal quarter and fiscal year by Owner and
payment in full by Charterer of the Escrow Amounts hereunder shall satisfy the
Charterer's obligations under this Paragraph 3.C for both the Vessel and the
Second Vessel.
D. Charterer shall not make any deductions from the Charter Hire, except
with respect to the following:
(1)Time actually lost by reasons of action or failure to act of Owner
or Owner's creditors or claimants other than the Charterer or its affiliates,
except to the extent such delays were caused or contributed to by Charterer.
(2) Any disbursements for Owner's account, provided Owner agrees in
writing.
(3) Any previous overpayments of Charter Hire, excluding any
overpayments of Charter Hire concerning which a bonafide dispute may exist, but
in the latter event the Owner shall furnish an adequate bank guarantee or other
good and sufficient security on request of the Charterer.
(4) Any sums to which Charterer is entitled under Article 12 herein.
ARTICLE 4
ON-HIRE SURVEY
A. Charterer has made its own independent assessment of the Vessel and
accepts the Vessel As-Is And Where-Is and the parties agree not to require an
on-hire survey. Any damage or deficiencies in either
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the hull, equipment and/or machinery affecting either the seaworthiness of the
Vessel or its capability to operate in its intended service or the maintenance
of the Vessel's classification society certificates or U. S. Coast Guard
required documents, certificates, or certifications required to operate in U.S.
waters, if any, discovered at any time prior to or during this Charter shall be
the sole responsibility of Charterer and any such damage or deficiency shall not
in any way alter, amend or excuse Charterer's obligations under this Charter.
B. Charterer's acceptance of the Vessel under this Charter shall constitute
an admission by the Charterer of full performance by the Owner of its
obligations with respect to the condition of the Vessel on Delivery per Article
5. Thereafter, the Charterer shall not be entitled to make or assert any claim
against the Owner on account of agreement, representation or warranty, either
express or implied, with respect to the condition, seaworthiness or fitness of
the Vessel. Failure of the Charterer to make an inspection of the Vessel and its
appurtenances shall be entirely at its own risk.
ARTICLE 5
DELIVERY OF THE VESSEL
A. The Vessel will be delivered by Owner hereunder to Charterer at a safe
and accessible berth or anchorage at Joliet, Illinois on the date hereof
("Delivery").
B. Representatives of Owner and Charterer shall jointly execute a
Certificate of Delivery and Acceptance, in the form attached hereto and marked
as Appendix B, acknowledging the delivery and receipt of the Vessel.
C. Due to the planned modification of the Vessel, the Vessel shall be
accepted As Is and Where Is, not in class and without any required United States
Coast Guard Certificate of Inspection. Charterer will obtain, independent from
Owner, all classification and Coast Guard certificates for the Vessel and if any
of the Vessel's classification or Coast Guard certificates require renewal at
the time of Delivery, such renewals shall be paid for by Charterer and Charterer
accepts full responsibility for obtaining any classification or certificates
required for the Vessel. The Charterer shall keep the Vessel's documentation and
classification certificates in full force and effect during the term of this
Charter or any extensions thereof, providing copies of such certificates to
Owner when issued, and shall renew all such certificates at the time of any
Redelivery under Article 13 whether or not due for renewal, unless otherwise
agreed to by the parties.
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D. Concurrently with the Delivery of the Vessel hereunder, the Owner shall
assign to the Charterer all of its rights, title and interest in and to any
warranties and guaranties which the Owner may have, provided that the same, if
still in effect, shall be reassigned to Owner upon Redelivery of the Vessel. If
any such warranty or guaranty is not fully assignable to the Charterer, the
Owner shall cooperate with Charterer to enforce its rights thereunder.
ARTICLE 6
USE AND OPERATION OF THE VESSEL
A. The Charterer shall have the full use of the Vessel and, subject to the
trading limits of Article 24 hereof, may employ the Vessel in any lawful trade
or trades in accordance with the laws and regulations of the Vessel's flag state
and any country where the Vessel may be operated, as the Charterer may from time
to time elect, and it agrees to comply with all local, state, and federal
regulations pertaining to the operation of the Vessel in the United States.
B. During the Charter Period the Vessel shall be under the complete control
of the Charterer, who shall have exclusive possession, control, and command of
the Vessel, subject to the terms hereof, and assumes full responsibility
therefor, including port charges, agencies, fines, assessments and penalties
incurred due to Charterer's use and operation of the Vessel. Nothing herein
contained shall be construed as constituting any implied restriction on
Charterer's right, during the Charter Period, consistent with this Charter, to
employ the Vessel for its own account or for the account of others, either on a
voyage or time charter basis, as the Charterer may from time to time determine,
provided however, Charterer must first obtain written consent of Owner, which
shall not be unreasonably withheld, before entering into any voyage or time
charter.
C. This Charter is a full and complete demise of the Vessel to the
Charterer. From the time of delivery to the termination of the Charter, at its
own expense, the Charterer shall either itself or through a maritime management
or agency contract, man, victual, navigate, including engaging other vessels and
pilots, operate, maintain in a good state of repair and in efficient operating
condition, insure and supply the Vessel. The Charterer shall be responsible for
all charges and expenses of every kind and nature whatsoever incidental to
Charterer's use and operation of the Vessel under the Charter including without
limitation fuel, lubricating oil, and water. Charterer shall return the Vessel
to Owner at the expiration of
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this Charter in the event Charterer does not elect to purchase the Vessel
pursuant to Article 19 hereof, in the same good order and condition as when
received, reasonable wear and tear excepted, in accordance with Article 13
herein.
D. (1) Except for a lien for wages of a stevedore, wages for the crew of
the vessel, general average or salvage including contract salvage, and except
for maritime tort liens covered (subject to a reasonable deductible) by
insurance or protection and indemnity entry, Charterer will not create or suffer
to be continued any security interest, lien, encumbrance or charge on the Vessel
or any income therefrom. In due course, and in any event within thirty (30) days
after the same becomes due and payable, the Charterer will pay or cause to be
discharged or make adequate provision for the payment or discharge of all claims
or demands which, if not paid or discharged, might result in the creation of a
security interest, lien, encumbrance or charge against the Vessel or any income
therefrom, and will cause the Vessel to be released or discharged from each such
security interest, lien, encumbrance or charge therefor.
(2) If a complaint shall be filed against the Vessel or if the Vessel
shall be seized, arrested and/or taken into custody or sequestered by virtue of
any legal proceedings in any court, the Charterer shall within ten (10) days
thereafter cause the Vessel to be released and discharged. Charterer shall
remain liable for the payment of Charter Hire throughout any of the foregoing
events.
E. Charterer agrees, at its expense, to drydock the Vessel for the purpose
of cleaning and painting the Vessel's bottom when necessary and making any
required repairs, inspections or surveys, but not less than twice in every sixty
months unless Owner otherwise agrees or as required by applicable Classification
Society rules, and when drydocking is due, Charterer agrees to send the Vessel
to a port where the Vessel can so drydock, clean and paint. All expenses
incidental to such drydocking and all charges incurred in connection therewith
shall be for the Charterer's account, regardless of whether Owner's repairs, if
any, are concurrently made, provided that the Owner's repairs do not delay the
operation of the Vessel or increase the cost to Charterer.
F. Charterer will pay and discharge when and as due and payable, all taxes,
assessments, excises, levies, documentation and registration fees, duties, fines
and penalties and other governmental charges including without limitation,
sales, use, franchise, property, gross receipts and occupation taxes lawfully
imposed upon the Vessel or the ownership, use, operation, registration,
documentation or maintenance
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thereof during the term of the Charter or on any Charter Hire or other amounts
payable hereunder, other than taxes and other charges imposed on or measured by
the net income or capital of the Owner.
ARTICLE 7
CONTINUED REGISTRATION OF VESSEL
The Vessel shall be kept documented under the laws and flag of the United
States during the period of this Charter. Charterer warrants it is a citizen of
the United States and entitled to own and operate vessels documented under the
laws of the United States with the privilege of engaging in the Coastwise trade.
ARTICLE 8
EQUIPMENT, OUTFIT AND FURNISHINGS
The Charterer shall have the use, without extra cost, of all equipment
(which shall include equipment for cabin, crew, and galley, navigational aids,
and technical equipment, furnishings, furniture, and fittings) outfit,
appliances, tools, spare and replacement parts, non-consumable stores, crockery,
linen, etc., as may be on board or installed upon the Vessel (as confirmed by an
inventory conducted by the Owner and the Charterer) on delivery of the Vessel to
the Charterer but shall exclude all gaming devices and related equipment and
materials. The same or their substantial equivalent, excluding gaming devices
and related equipment and materials and all other equipment leased by Charterer
from third parties, shall be returned to the Owner (as confirmed by an inventory
conducted by the Owner and Charterer) on Redelivery of the Vessel in the same
good order and condition as when received, normal wear and tear excepted. The
Charterer shall from time to time during the Charter period, replace such items
of equipment as shall be so damaged or worn as to be unfit for use. Should the
inventory at Redelivery show missing items of equipment, to the extent the
reasonable value of the missing items exceeds the Purchase Option Prepayments,
the Charterer shall replace the item or pay such excess to the Owner.
ARTICLE 9
INVENTORY
ITG Vegas owns and has paid for the inventory, including, without
limitation, consumable stores, on board the Vessel at the time of Delivery.
Accordingly, Owner is not entitled to any payment for the inventory and
Charterer shall have the right to remove the inventory from the Vessel on or
prior to
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Redelivery and to retain ownership thereof.
ARTICLE 10
ALTERATIONS
A. Charterer has proposed certain alterations to the Vessel as detailed in
Exhibit C to be performed shortly after Charterer is to take delivery of the
Vessel from Owner. Owner hereby provides its consent to such alterations, but
assumes no liability or responsibility and makes no representation or warranty
as to the feasibility of the alterations, the ability to complete the
alterations within budgeted costs, the qualifications of the shipyard to perform
the alterations, or the ability of Charterer to obtain Coast Guard and
classification society approvals required for the certification of the altered
Vessel for any purpose, including Charterer's intended use and operation of the
Vessel. Owner and Charterer agree that the costs of such alterations shall be
paid solely to the extent of funds held in a blocked account for the benefit of
Owner, solely in accordance with that certain Account Agreement of even date
herewith among Charterer, Owner, Cruise Holdings I, LLC, PDS Funding 2004-A, LLC
and Silver State. Charterer's failure to complete the alterations for any
reason, including impossibility of performance, the failure of the shipyard to
complete the work, costs overruns, or the failure to obtain certification for
the altered Vessel, will not excuse Charterer from its obligation hereunder
including its obligation to pay monthly Charter Hire as set forth in Article 3
and this Charter will continue in full force and effect regardless of any such
failure hereunder.
B. From time to time after delivery of the Vessel into the Charterer's
service, the Charterer may make structural and other alterations to the Vessel,
its machinery, or electrical equipment, only with Owner's prior written
approval, which shall not be unreasonably withheld, provided the alterations to
the Vessel and its equipment are returned to their original state at or prior to
the termination of this Charter and Redelivery of the Vessel to Owner. Owner,
however, has the option to retain any alterations made by Charterer at a
mutually agreed price. In addition, leased equipment may be placed on board the
Vessel by the Charterer. At the time of Redelivery, the Owner has the right at
Owner's expense to continue any equipment lease should such lease permit or may
require the Charterer to have any or all of such leased equipment removed. As to
equipment otherwise placed aboard the Vessel by the Charterer, Charterer shall
have the right to remove same upon Redelivery, provided that if Owner desires to
retain the equipment on
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board the Vessel, it may purchase the equipment at a price to be agreed upon at
the time of Redelivery. Any additions or alterations permitted by this Article
are subject to approval by the Vessel's classification society, and, if
required, the U. S. Coast Guard. Notwithstanding anything to the contrary
contained in this Charter, Charterer shall not have the right to remove any
gaming equipment other than in accordance with that certain Master Lease (Palm
Beach Princess and Empress II Gaming Equipment), of even date herewith, between
Owner, as Lessor, and Charterer, as Lessee, without the prior written approval
of Owner.
C. Charterer shall have the right to paint its own house colors thereon at
Charterer's expense and on its time, provided Charterer changes the colors and
markings back prior to Redelivery at its expense. Charterer shall have the right
to rename the Vessel, and shall pay for all associated costs therefor. Prior to
Redelivery, Charterer shall rename the Vessel at its expense in accordance with
Owner's reasonable instructions. However, Owner shall in no event have the right
to the use of the Charterer's trademark following Redelivery.
D. The Vessel shall be kept painted and metal surfaces preserved at all
times, and the Charterer shall maintain the Vessel in as good a condition as
when delivered to Charterer from the shipyard upon completion of the alterations
set forth in Exhibit C hereto, normal wear and tear excepted.
ARTICLE 11
INSURANCE
A. (1) Charterer shall, at all times during the period of this Charter, at
its own cost and expense, carry and maintain on the Vessel insurance coverage
covering all marine and hull risks, including towers liability, war risk
insurance, protection and indemnity insurance, together with coverage for
pollution clean up costs and expenses including natural resource damage, third
party claims as well as any fines or civil penalties now or hereafter imposed
under all applicable Federal, State and Local laws, or the laws of any foreign
country or political subdivision thereof having jurisdiction over the Vessel,
and such crew insurance as is required, in order to completely protect the Owner
from any and all liability or loss or damage to any party whomsoever. Such
insurance shall, at a minimum, be in the standard forms available in the
American and British insurance markets and further be in such form and in such
amounts and with such underwriters as Owner shall approve. Charterer agrees to
pay all deductibles and franchises provided for in said insurance policies.
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(2) The Vessel shall be covered by Hull and Machinery, Marine and War
Risk insurances initially in the amount of the value of the Vessel, which will
increase to Six Million Dollars ($6,000,000.00) upon completion of the
modifications described in Article 10.A., and thereafter maintained in the
amount of Six Million Dollars ($6,000,000.00) during the remaining duration of
this Charter. Such insurance shall include an endorsement for acts of terror.
(3) The Vessel shall be entered for Protection and Indemnity insurance
with a Protection and Indemnity Association or Club, or Charterer shall obtain
such liability insurance coverage, covering customary protection and indemnity
liabilities as outlined in this Article 11 in an amount not less than the value
of the Vessel and covering pollution liability in the amount of Twenty-Five
Million ($25,000,000.00) Dollars, with a deductible for each accident of not
more than Twenty-Five Thousand ($25,000.00) Dollars and shall include an
endorsement for acts of terror.
(4) Charterer will have Owner named as a co-insured or additional
insured in all policies of insurance including the waiver of subrogation of any
and all claims against the Owner, and shall deliver to Owner certificates of
insurance evidencing Owner's status as co-insured or additional insured.
B. Notwithstanding anything herein to the contrary, in the event that any
of the insurance, to be provided by the Charterer, by reason of an act, omission
or neglect of the Charterer, shall not be kept in full force and effect, or for
any reason does not cover in full all losses, damages, claims and/or demands,
the Charterer shall indemnify, defend and hold harmless the Owner against all
such losses, claims and/or demands.
C. Losses under any insurance provided for in this Article shall be payable
as hereunder provided, and all policies shall contain clauses to the same
effect:
(1) The proceeds of insurance for all losses, except for total or
constructive total loss, shall be payable to the satisfaction and discharge of
the liability or to the repair of damage in respect of which the insurance loss
has been paid or in reimbursement for monies theretofore applied.
(2) In the event of an actual or constructive total loss of the
Vessel, the insurance proceeds shall be paid to the Owner and shall be applied
by the Owner to reduce any amounts due and payable by the Charterer hereunder
and under the Master Lease. Any insurance proceeds in excess of the sum of (i)
the Casualty Value, together with any Charter Hire that is past due hereunder,
plus (ii) any
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amounts owing under the Master Lease (other than Basic Rent), plus (iii) any
amounts due Owner under paragraph 12(A) hereof or amounts in dispute thereunder
(it being understood that upon resolution of the indemnification claim
concerning such amounts, such amounts shall be disbursed in accordance with the
terms of such resolution), shall be promptly paid to the Charterer.
D. The Charterer shall promptly furnish Owner with full information
regarding any casualty or other accident or damage to the Vessel involving an
amount in excess of Fifty Thousand Dollars ($50,000.00).
ARTICLE 12
INDEMNITIES
A. (1) Charterer shall assume the defense of, indemnify and hold harmless
the owner against any lien or claim of whatsoever nature on the vessel and
against any claims of third parties against the owner or the vessel of
whatsoever nature, including claims for personal injuries, death or property
damage and without limitation by this enumeration, penalties or fines, either
criminal or civil arising from violation of the laws of the united states or any
state thereof or of the laws of any country or subdivision thereof to which the
vessel may be sent, whether such claims or liens are founded or unfounded
provided such lien or claim shall have arisen from the use, operation or custody
of the vessel by Charterer or out of any act or neglect on Charterer's part or
on the part of its employees, agents, representatives, or contractors. The
indemnity shall include all reasonable costs payable or incurred in defending or
investigating such claims or liens.
(2) Should a suit or any other legal proceeding be filed against the
vessel or should the vessel be levied against, arrested or taken into custody by
virtue of a legal proceeding arising out of the use, operation or custody of the
vessel by Charterer or out of any act or neglect on Charterer's part or on the
part of Charterer's employees,
14
agents, representatives, or contractors, Charterer shall immediately notify
owner or owner shall immediately notify Charterer as the case may be, and
Charterer shall take immediate action to free the vessel from the claim, demand
or lien thereupon placed and obtain the release of the vessel from custody or
arrest.
(3) In the event that Charterer fails to fulfill its obligations under
this Article, Owner may undertake same at the expense of Charterer.
(4) In the event that any lien or claim as set forth in paragraph (1)
above, the uninsured (if applicable) portion of which lien or claim is
reasonably valued in excess of two hundred thousand dollars ($200,000.00),
Exists at the time of the closing of Charterer's purchase of the vessel pursuant
to article 19 of this charter, Charterer shall provide security to owner in an
amount equal to the estimated value of the uninsured portion of such lien or
claim prior to such closing. Such security shall be provided by Charterer for
the benefit of owner in a form reasonably acceptable to owner, including without
limitation cash, escrowed funds, letter of credit, marketable securities or
payment bond. Charterer agrees to apply any applicable insurance proceeds
towards payment of such lien or claim. If the closing of the purchase of the
vessel by Charterer pursuant to article 19 is delayed because of any reasonable
dispute under this paragraph, owner may, in its sole discretion, continue to
hold title to the vessel as collateral security pending resolution of such
dispute and this charter shall continue in full force and effect except that
Charterer shall have no obligation to pay charter hire hereunder or basic rent
under the master lease.
B. (1) Owner shall assume the defense of, indemnify and hold harmless the
Charterer against any lien or claim of whatsoever nature on the Vessel and
against any claims of third parties against the Charterer
15
or the Vessel of whatsoever nature including claims for personal injuries, death
or property damage and without limitation by this enumeration, penalties or
fines arising from violation of the laws of the United States or any state
thereof whether such claims or liens are founded or unfounded provided such lien
or claim shall have arisen from the use, operation or custody of the Vessel by
Owner or out of any act or neglect on Owner's part or on the part of its
employees, agents, representatives or contractors. The indemnity shall include
all reasonable costs payable or incurred in defending or investigating such
claims or liens.
(2) Should a libel be filed against the vessel or should the vessel be
levied against, arrested or taken into custody all during the period of this
charter by virtue of legal proceeding arising out of the use, operation or
custody of the vessel by owner or out of any act or neglect on owner's part or
on the part of owner's employees, agents, representatives or contractors,
Charterer shall immediately notify owner and owner shall take immediate action
to free the vessel from the claim, demand or lien thereupon placed and obtain
the release of the vessel from custody or arrest.
(3) In the event Owner fails to fulfill its obligations under this
Article, Charterer may undertake same at the expense of owner.
ARTICLE 13
TERMINATION AND REDELIVERY AND OFF-HIRE SURVEY
A. Charterer shall have the right to terminate this Charter upon prepayment
in accordance with Section 10 of the Lease Schedule to the Master Lease.
B. In the event Charterer does not purchase the Vessel pursuant to Article
19 hereof, upon termination of the Charter prior to the expiration of the
Original Period, the Charterer shall, at its expense redeliver the Vessel
("Redelivery") (unless lost or declared a constructive total loss) to the Owner
at any port identified by Owner provided such port is at or within one hundred
(100) nautical miles of the Port of
16
Palm Beach, Florida, or such other port mutually agreed upon.
C. No further Charter Hire shall accrue after expiration of the Original
Period. Interest on the unpaid Charter Hire then due shall accrue at the rate of
fifteen percent (15%) per annum.
ARTICLE 14
EVENTS OF DEFAULT
If an Event of Default, as defined in the Master Lease, shall occur and
remain uncured beyond any applicable cure period, the Owner may withdraw the
Vessel from the service of the Charterer and immediately terminate this Charter.
Notwithstanding any provisions of this Charter to the contrary, this Charter
shall immediately terminate upon the termination of that certain Sub-Bareboat
Charter (Empress II) of even date herewith between MJQ and PBE, as owner, and
ITG Vegas and ITG Palm Beach, jointly and severally as lessee. Any termination
of this Charter, as provided in this Article 14, shall be without prejudice to
any claim the Owner may have against the Charterer pursuant to this Charter,
including cost of Redelivery to the Port of Palm Beach, Florida; provided,
however, that Charterer shall, in such event, have the rights set forth in
Article 19; provided further that Owner and Charterer shall have the rights and
obligations as set forth in Section 20.2 of the Master Lease, which section is
incorporated herein by reference.
ARTICLE 15
REQUISITION OR SEIZURE OR FORFEITURE
A. Requisition of the use of the Vessel by any government or governmental
authority on a bareboat, time or voyage charter basis, or on any other basis not
involving requisition of title to or seizure or forfeiture of the Vessel, during
the Charter Period even though at the time of such requisition the Charterer
shall have been deprived of, or limited in, the use of the Vessel to any extent
and for any duration, for whatever cause, shall not terminate or extend this
Charter. The Charterer shall continue to make payment of Charter Hire without
interruption or abatement and shall remain liable for all other obligations
under this Charter and shall be entitled to the total amount of requisition
Charter Hire and any other amount payable with respect to such requisition. The
foregoing provisions shall be without prejudice to the rights of the Owner and
the Charterer against other parties in respect of any such charges or expenses.
The Owner undertakes, insofar as any such rights are vested in it, to take at
the Charterer's
17
request and expense all reasonable steps to enforce such rights, and any sums
recovered from other parties in respect of such charges or expenses shall be
retained by or payable to the Charterer.
B. In the event that title to the Vessel shall be requisitioned, or if the
Vessel should be seized by, or forfeited to, any government or governmental
authority, during the Charter Period, and such requisition, seizure or
forfeiture shall not result from any act or omission of the Charterer (even
though at the time of such requisition or seizure or forfeiture the Charterer
shall have been deprived of, or limited in, the use of the Vessel to any extent
and for any duration, for whatever cause), the Charterer shall forthwith notify
the Owner of the facts and circumstances of such requisition, seizure or
forfeiture and this Charter shall terminate. Charter Hire payments shall
continue until the earlier of expiration of the Original Period or receipt by
Owner of an amount equal to the Casualty Value of the Vessel, as set forth in
Schedule A.1 of the lease schedule to the Master Lease, determined as of the
date of the Owner's receipt of the requisition proceeds. However, Charterer
shall be entitled to any and all proceeds or amounts received from any
governmental agency or authority representing payment for charter hire and/or
the value of the Vessel at the time of requisition or seizure.
C. In the event of the termination of this Charter pursuant to this Article
15, the Charterer shall have the rights set forth in Article 19.
ARTICLE 16
INSPECTION BY OWNER
The Owner or its authorized representative may inspect the Vessel at any
time during the currency of this Charter upon reasonable notice to the Charterer
and provided such inspection does not delay the Vessel's employment.
ARTICLE 17
LIMITATIONS AND BENEFITS
Nothing contained herein shall be deemed to prohibit or deny to the Owner
or to the Charterer the benefit of any limitations of, and exemptions from,
liability accorded to the owners, bareboat Charterers, and operators of Vessels
by any statute or rule or law in force at the time such benefit, limitation or
exemption is invoked.
18
ARTICLE 18
ASSIGNMENT AND SUB CHARTER
Owner and Charterer may assign this Charter, only in accordance with
Section 17 of the Master Lease. Charterer shall not sub-demise charter the
Vessel, except to ITG Vegas and/or ITG Palm Beach, without the express written
consent of the Owner. Subject to the terms of Section 17 of the Master Lease,
the parties to this Charter shall remain responsible for its performance in the
event of any assignment thereof, or sub-demise charter of the Vessel. Subject to
the immediately preceding sentence, ITG Vegas and/or ITG Palm Beach may perform
any covenant or obligation or exercise any right of Charterer hereunder,
including, without limitation, the purchase option described in Article 19 and
the obligation to maintain insurance described in Article 11. Notwithstanding
any provision of this Charter or any sub-demise charter between Charterer and
ITG Vegas and/or ITG Palm Beach, in the event of the termination of this
Charter, any sub-demise charter between Charterer and ITG Vegas, ITG Palm Beach,
and/or any other party shall automatically terminate.
ARTICLE 19
SALE OF VESSEL
A. Upon termination of this Charter for any reason, PBE may purchase the
Vessel from the Owner upon the following terms and conditions.
B. PBE shall exercise this option to purchase the Vessel by giving written
notice to the Owner within ten (10) days after termination of this Charter for
any reason, as the case may be, of its intent to purchase the Vessel on a
mutually acceptable closing date; provided, however, that if no payment default
has occurred and is continuing as of the expiration of the Original Period, then
PBE shall be deemed, without further action, to have exercised its purchase
option under this Article 19 and to have fully paid the Purchase Option Exercise
Price.
C. In the event PBE elects to exercise or is deemed to have exercised its
option to purchase the Vessel, Owner agrees to sell, and PBE agrees to purchase
the Vessel, together with everything belonging to such Vessel, including the
hull, machinery and tackle, as well as all other associated and installed
equipment which may be on board, excluding all gaming devices and related
equipment and materials.
D. The total purchase price to be paid by PBE in the event of a sale upon
the termination of this
19
Charter prior to expiration of the Original Period for any reason shall be the
Casualty Value, as defined in the Master Lease and set forth in the Lease
Schedule attached thereto (the "Purchase Option Exercise Price"), minus the
aggregate amount of any Purchase Option Prepayments received by Owner as of the
date of such termination. Payment shall be made as mutually agreeable between
Owner and PBE or in the absence of any such agreement, by electronic transfer to
Owner, in accordance with Owner's written instructions. PBE's payment of the
purchase price with respect to such Vessel may be deemed received by Owner upon
Owner's receipt of confirmation from the appropriate officer of Owner's bank
that the electronic transfer of funds to Owner's account has been accomplished.
E. Owner and PBE shall set a mutually agreeable closing date and location
for the consummation of the sale of the Vessel subsequent to PBE's notification
of the Owner that it desires to purchase the Vessel, which date shall not be
less than forty-five (45) days after the termination of this Charter for any
reason in the event of a sale upon termination. Upon payment of said purchase
price pursuant to the terms of paragraph D of this Article 19, all rights, title
and interest in said Vessel shall pass to PBE upon the acknowledgment of the
receipt of payment by Owner.
F. At closing, Owner shall furnish PBE an executed and notarized Xxxx of
Sale (form CG-1340), in duplicate, transferring title to PBE and warranting that
such Vessel is free from all mortgages, liens, and encumbrances of any kind
whatsoever (other than those, if any, arising out of Charterer's or its
subCharterer's use, operation or custody of the Vessel under this Charter and
those existing prior to the date hereof); and a U.S. Coast Guard Abstract of
Title for such Vessel, and showing no mortgages, liens, or encumbrances of
record (other than those, if any, arising out of the Charterer's use, operation
or custody of the Vessel under this Charter or those existing prior to the date
hereof).
G. Passage of title from Owner to PBE shall constitute acknowledgment by
PBE that the Vessel is in a condition completely acceptable to PBE, and PBE will
thereafter have no warranty claim against Owner for any defects in such Vessel,
whether patent or latent, it being specifically understood and agreed between
PBE and Owner that subsequent to the parties' inspection of the Vessel, as
specified in Article 4, at the time of the on-hire survey the sale of the Vessel
is "as is, where is", with PBE relying solely on its own examination and
inspection of the Vessel at such survey, and without any representation or
warranty by Owner, expressed or implied, as to seaworthiness, condition, or
suitability for any particular purpose, trade
20
or service, but with full warranty of title except for those mortgages, liens
and encumbrances of any kind whatsoever arising out of Charterer's prior
ownership or the use, operation or custody of the Vessel under this Charter. PBE
agrees to pay any sales or use taxes, assessments or charges which may apply to
the purchase of such Vessel, except income or other taxes or assessments based
upon revenues, earnings or assets.
H. In the event the Purchase Option is not exercised or deemed exercised in
accordance with this Charter, Owner shall remit to PBE any Purchase Option
Prepayments received by Owner to PBE, less (i) any payments due hereunder or
under the Master Lease; (ii) any amounts due Owner under paragraph 12(A) hereof
or amounts in dispute thereunder (it being understood that upon resolution of
the indemnification claim concerning such amounts, such amounts shall be
disbursed in accordance with the terms of such resolution); (iii) the reasonable
value of any equipment not replaced by Charterer, and (iv) damages or costs
associated with or arising from the enforcement of this Charter or the Master
Lease.
ARTICLE 20
GOVERNING LAW
The interpretation of this entire agreement shall be governed by the
Maritime Law of the United States of America and by the laws of the State of
Nevada.
If any provision of this Charter is unenforceable under applicable law,
such provision shall be void and the other provisions hereof shall continue in
full force and effect. The parties shall use their best efforts to resolve by
agreement any problem which may arise as a result of any changes in applicable
law or regulations affecting performance of this Charter.
The terms and provisions of this Charter, the Master Lease and accompanying
Lease Schedule constitute the entire agreement between the parties hereto and
this Charter shall not be amended or supplemented, or any term or provision
thereof waived except in writing signed by the party or parties to be bound
thereby and no promise, agreement, warranty, or representation not set forth
herein, therein or in such written amendment or supplement shall be of any force
or effect. In the event that any provision of this Charter conflicts with the
provisions of the Master Lease dated of even date herewith between Owner and
Charterer, the terms of this Charter shall govern.
21
ARTICLE 21
JURISDICTION. WAIVER OF JURY TRIAL AND PUNITIVE DAMAGES
A. Each of the parties irrevocably and unconditionally (i) agrees that any
legal suit, action or proceeding brought by a party hereto arising out of or
based upon this Charter, except for an in rem action against the Vessel, shall
exclusively be brought in the United States District Court for the District of
Nevada ("District of Nevada"), (ii) waives, to the fullest extent it may
effectively do so, any objection with it may now or hereafter have to the laying
of venue of any such proceeding brought in the District of Nevada, and any claim
that any such action or proceeding brought in the District of Nevada has been
brought in an inconvenient forum, (iii) submits to the exclusive jurisdiction of
the District of Nevada in any suit, action or proceeding, and (iv) agrees that
the losing party shall pay to the prevailing party the attorneys' fees and
expenses incurred by the prevailing party in such action. If for any reason the
District of Nevada lacks jurisdiction over a matter arising out of or based upon
this Charter, excluding any in rem action against the Vessel, the District Court
for the State of Nevada in Las Vegas, Nevada ("Nevada State Court") shall then
have exclusive jurisdiction and all other provisions of this Article 21 shall
remain valid and enforceable in such court.
B. Each of the parties agrees and acknowledges that any controversy that
may arise under this Charter, whether filed in the District of Nevada, the
Nevada State Court or otherwise, is likely to involve complicated and difficult
issues, and therefore each such party hereby irrevocably and unconditionally
waives any right such party may have to a trial by jury in respect of any
litigation directly or indirectly arising out of or relating to this Charter, or
the breach, termination or validity of this Charter.
C. Each of the parties hereby irrevocably and unconditionally waives any
right it may have to claim and receive an award for punitive damages for any
claim arising out of or relating to this Charter, or the breach, termination or
validity of this Charter.
ARTICLE 22
LOSS AFTER DELIVERY
A. If the Vessel becomes an actual total loss during any term of this
Charter and prior to any sale to Charterer, this Charter shall terminate as of
the date of the actual loss. If the Vessel becomes a constructive or compromised
total loss under the insurances, this Charter shall also terminate, but payment
of Charter Hire shall continue until the earlier of (i) expiration of the
Original Period and (ii) such time as
22
the underwriters or Charterer, in the case of self-insurance, remit to Owner
proceeds of said insurance in an amount equal to the Casualty Value of the
Vessel, as set forth in Schedule A-1 of the lease schedule to the Master Lease,
which Casualty Value is to be determined as of the date of Owner's receipt of
such proceeds. In either case, in the event such proceeds of insurance exceed
the Casualty Value, as defined in the Master Lease, as determined as of the time
such insurance proceeds are remitted to Owner, such excess proceeds, less any
amounts due Owner under this Charter or the Master Lease, shall be distributed
to PBE on behalf of the Charterer.
B. No tender or abandonment of the Vessel to the underwriters as a
constructive total loss shall be made without the prior approval of the Owner,
which approval will not be unreasonably withheld.
ARTICLE 23
LOG BOOKS
Charterer's crew shall maintain full and complete logs and at Owner's
request, Charterer shall furnish to Owner true copies of said logs.
ARTICLE 24
TRADING LIMITS
During any term of this Charter, the parties agree that the Vessel shall
have a trading limit of inland, tributary, coastal and nearby adjacent waters of
the United States East Coast; Bahamas; Gulf of Mexico; and Caribbean.
ARTICLE 25
BUSINESS POLICY PROVISIONS
Charterer agrees to comply with all laws and lawful regulations, including
any gaming laws, regulations, licenses or permits, applicable to any activities
carried out in the name of or representative of Charterer under this Charter.
Charterer agrees that all financial settlements and reports rendered to Owner
under this Charter will, to the best of its knowledge and belief, reflect
properly the facts about all activities and transactions handled for the account
of Charterer which data may be relied upon as being complete and accurate in any
further recording and reporting made by Owner for whatever purpose. Charterer
agrees to notify Owner promptly upon discovery of any instances where the
Charterer fails to comply with provisions above.
23
ARTICLE 26
ANTI-DISCRIMINATION PROVISIONS
During the performance of this Charter, and any and all supplements and
amendments hereunder to the extent applicable, Charterer agrees to comply with
requirements of the Federal Government as more particularly specified that both
parties understand Charterer is an Equal Opportunity Employer and will not
engage in any conduct or practice which violates any applicable law, order or
regulation prohibiting discrimination against any person by reason of race,
color, religion, national origin, sex or age or on account of being handicapped,
a disabled veteran or a veteran of the Vietnam era.
ARTICLE 27
NOTICES
Any written notice required or authorized to be given hereunder by either
party to the other may be given by postage prepaid letter or by telegram, cable,
telex, facsimile or other similar means,
TO THE OWNER:
0000 XxXxxx Xxxxx
Xxx Xxxxx, Xxxxxx 00000
Cable:
Telefax Number:
Telephone Number:
TO THE Charterer:
Xxx Xxxx 00xx Xxxxxx, Xxxxx 000
Xxxxxxx Xxxxx, Xxxxxxx 00000
Cable:
Telefax Number:
Telephone Number:
or to such other address or addresses as may from time to time be specified by
either party to the other in writing.
24
IN WITNESS WHEREOF, the parties hereto have executed this Charter as of the
date first set forth above.
Charterer: OWNER:
PALM BEACH MARITIME CORPORATION, CRUISE HOLDINGS II, LLC
formerly named MJQ CORPORATION
By:/S/Xxxxxxx X. Xxxxxx By:/s/Xxxxx X. Xxxxxx
Name: Xxxxxxx X. Xxxxxx Name: Xxxxx X. Xxxxxx
Its: President Its: President
Witness: Witness:
---------------------- ------------------
Charterer:
PALM BEACH EMPRESS, INC.
By:/S/Xxxxxxx X. Xxxxxx
Name: Xxxxxxx X. Xxxxxx
Its: President
Witness:
-------------------
25
Exhibit A
For purposes of Article 3 of this Charter, Annualized EBITDAR shall be
calculated by adjusting for seasonality factors reflected in fiscal year
6/30/03, as follows:
Annualized EBITDAR shall equal the quotient of the year-to-date calculation
of EBITDAR divided by 13% for the three month period ended September 30, 30% for
the six month period ended December 31 and 63% for the nine month period ended
March 31.
26
Appendix A
EMPRESS II
The EMPRESS II is the Ship and General Improvement at and on the maritime vessel
named the EMPRESS II Casino Cruise Ship (United States Official Number 998517.
General Improvements shall mean all equipment and FF&E as defined in Section
1250 of the United States Internal Revenue Service Publication 946, where the
equipment and FF&E is considered a structural component or critical operating
component of the vessel.
00
Xxxxxxxx X
CERTIFICATE OF DELIVERY AND ACCEPTANCE
Cruise Holdings II, LLC, Owner, acting through its authorized agent, does
hereby deliver to Palm Beach Empress, Inc. and Palm Beach Maritime Corporation,
formerly named MJQ Corporation, the Vessel EMPRESS II, Coast Guard Official
Number 998517 (hereinafter the "Vessel"), pursuant to the terms of Bareboat
Charter With Option to Purchase of the Casino Cruise Ship EMPRESS II previously
executed by the parties.
Palm Beach Empress Inc. and Palm Beach Maritime Corporation, formerly named
MJQ Corporation, jointly and severally as Charterer, acting through their
authorized agents, hereby accept physical delivery of the Vessel in accordance
with the terms of the aforesaid mentioned agreement at the time, date and place
set forth herein.
Delivered and Accepted this 6th day of July, 2004 at Palm Beach, Florida.
Accepted: Delivered:
PALM BEACH EMPRESS INC. CRUISE HOLDINGS II, LLC
By:/S/Xxxxxxx X. Xxxxxx By:/s/Xxxxx X. Xxxxxx
Name: Xxxxxxx X. Xxxxxx Name: Xxxxx X. Xxxxxx
Its: President Its: President
Witness: Witness:
Accepted:
PALM BEACH MARITIME CORPORATION,
formerly named MJQ CORPORATION
By:/S/Xxxxxxx X. Xxxxxx
Name: Xxxxxxx X. Xxxxxx
Its: President
Witness:
28
Appendix C
CHARTERER'S PROPOSED ALTERATIONS
29
