Common use of Terms and Conditions of Sale Clause in Contracts

Terms and Conditions of Sale. Any sale of the Ship pursuant to clause 2.8 (but not, for the avoidance of doubt, pursuant to clause 2.9) will be on the following terms and conditions and shall otherwise be completed in accordance with the provisions set out below: 2.7.1 the sale will be at a cash price payable by the purchaser to the Lessor in full on completion of that sale in Dollars or such other currency as the Lessor may agree (such agreement not to be unreasonably withheld or delayed); 2.7.2 the sale will be on the best terms (including price) which, in the opinion of a reputable firm of independent ship valuers and surveyors experienced in the container carrier sector, are reasonably obtainable on the open market on an “as is, where is” basis taking into account where continuing, the Time Charter and any charter of the Ship at that time which shall have been notified to the Lessor and approved by the Lessor pursuant to clause 10.17 and which is intended to continue (and is capable of continuing) after the date of sale and the termination of the bailment to the Lessee under this Agreement; 2.7.3 the sale may be to any person other than: (a) the Time Charterer, the Lessee or any other person to whom the Ship has at any time been leased or sub-leased; or (b) any person who is purchasing in trust for any of the parties referred to in (a); or (c) any other person to whom, by virtue of a Change of Law occurring after the date of this Agreement, a sale is certified by the Lessor (the “Lessor’s Certificate”) as being reasonably likely to result in the Lessor losing with retrospective effect its right to claim capital allowances on or by reference to expenditure previously incurred on the provision of the Ship provided however that if the Lessee does not agree with the Lessor’s Certificate it shall be entitled to require the Lessor to obtain promptly a written opinion from leading tax counsel (“Counsel”) (in accordance with the provisions of clause 2.7.3(g)) stating whether or not the Lessor’s Certificate is correct; (d) if Counsel is of the opinion that the Lessor’s Certificate is incorrect, then the Lessee shall be entitled to sell the Ship to any person other than such persons as are specified in (a) or (b) above, without the provision of any further security to the Lessor; (e) if Counsel is of the opinion that the Lessor’s Certificate is correct, the Lessee shall be entitled to sell the Ship to any person other than such persons as are specified in (a) and (b) above, conditional upon the Lessee having first provided to the Lessor additional security of such appropriate amount and on such terms as the Lessor shall determine (acting in good faith) to be necessary to secure it (on an after-tax basis) against any additional cost or expense (including Tax) arising as a result of the Lessor losing with retrospective effect its right to claim capital allowances on or by reference to expenditure previously incurred on the provision of the Ship, such security to be released to the Lessee to the extent not required to meet any cost or expense on the End Date (as defined in the Financial Schedule); (f) if the Lessee notifies the Lessor in writing that it does not require the Lessor to obtain an opinion from Counsel, it shall be entitled to sell the Ship to any person other than such persons as are specified in (a) or (b) above, provided that it shall have first provided to the Lessor additional security of such amount and on such terms as the Lessor shall determine (acting in good faith) to be necessary to secure it (on an after-tax basis) against any additional cost or expense (including Tax) arising as a result of the Lessor losing with retrospective effect its right to claim capital allowances on or by reference to expenditure previously incurred on the provision of the Ship, such security to be released to the Lessee to the extent not required to meet any such cost or expense on the End Date (as defined in the Financial Schedule); (g) the Lessee shall be entitled to require the Lessor to obtain the opinion of Counsel chosen for the foregoing purpose by agreement between the Lessor and the Lessee (or in the absence of agreement by the Chairman of the Bar Council whom the Lessor and the Lessee shall instruct for that purpose). A consultation with Counsel shall be arranged expeditiously after the Lessor receives notification from the Lessee that it requires Counsel’s opinion on the Lessor’s Certificate. Counsel shall be instructed on the basis of instructions prepared by the Lessor’s legal advisers in consultation with the Lessee and its legal advisers (with the intent that the Lessee and its legal advisers shall have a reasonable opportunity to consider and contribute to such instructions). The Lessee and its legal advisers shall be entitled to attend any consultation with Counsel save that the Lessee and its professional advisers shall withdraw from such consultation at the request of the Lessor for so long as, in the reasonable opinion of the Lessor, matters which are confidential or of a sensitive nature having regard to the business of the Lessor, or which relate to the confidential affairs of a third party, are to be discussed during such consultation. The cost of Counsel’s opinion shall be for the account of the Lessee save where Counsel is of the opinion that the Lessor’s Certificate is incorrect, in which case it shall be for the account of the Lessor; 2.7.4 the terms of the sale will include a warranty on the part of the Lessor that the Lessor will pass such title to the Ship as the Lessor has acquired pursuant to the Novated Building Contract free of Lessor’s Security Interests, but otherwise shall be without any representation, recourse or warranty whatsoever to or on the part of the Lessor; 2.7.5 the Lessee, for its own account, may give any warranties reasonably required by the purchaser of the Ship in accordance with market practice for the sale of vessels of a similar type, design and age as the Ship; 2.7.6 the terms of the sale will include, subject to the consent of the Builder pursuant to the Novated Building Contract, an assignment by the Lessee of any unexpired portion of any assignable warranties and indemnities referred to in clause 6.5; 2.7.7 the sale will be on an “as is, where is and with all faults” basis and governed by the laws of England; 2.7.8 if the proposed sale provides for delivery of the Ship by the Lessor, such obligation is conditional on the Ship first being redelivered to the Lessor; 2.7.9 the sale will be for delivery on, or if for any reason a sale is not possible on that date as soon as reasonably practicable after, the termination date specified in the notice served by the Lessee pursuant to clause 2.5; 2.7.10 the sale will exclude, so far as permitted by the laws of England and any other laws governing or applicable to the sale of the Ship, all liability of the Lessor, in contract or tort, in relation to the Ship to the same extent as such liabilities are excluded by clause 6 except for the warranty given by the Lessor referred to in clause 2.7.4; and 2.7.11 if the Ship is at the date of entry into any contract for the sale of the Ship subject to any requisition for hire or (where continuing) the Time Charter or any other chartering of the Ship which shall have been notified to, and approved by the Lessor pursuant to clause 10.17 and which is continuing as at such date notwithstanding the termination of the bailment to the Lessee the sale will be subject to such requisition or any such other chartering of the Ship.