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IRON ORE SUPPLY
CONTRACT
By and Between
THE SELLER:
W.(PROPRIETARY) LIMITED &
Seller Represenative:
XXX
THE BUYER:
DATE: Month,
day , 2004
CONTRACT NO.: CCME/.........../2004
Contents
Page
1. Buyer and Seller Information
2. Name of Commodity and Ports
3. Delivery Period and Quantity
4. Product Specifications and Warranties
5. Price
6. Payment
7. Shipping Documents
8.
Weight Determination
9. Sampling and Analysis
10. Shipping Schedule and Loading Conditions
11. Insurance
12. Transfer
of Title and Risk
13. Loss of Cargo
14. Taxes and Dues
15.
Default.....................................................................................................
16. Force Majeure
17.
Arbitration
18. Governing Law
19. Assignment
20. Waiver
21. Severability
22.
Amendment of the Contract
23. Confidentiality
24. Entire Contract…………………………………………………………………
25. Effective Date ………………………………………………………………....
26. Notices …………………………………………………………………..........
27. Other …………………………………………………………………………...
28. Signature Page ……………………………………………………………….
BUYER AND SELLER INFORMATION:
Buyer:
Address
City:
Phone:
Fax:
Represented by:
Buyer Bank:
Address:
Account name:
Account no.
:
Phone:
Fax:
Swift: 2
Bank Officer:
Seller: W. (Pty) Ltd
Address: XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX,
XXXXXXXXXXXXXXXXXXXXX
,
XXXXXXXXXXXXXXXXXXXXXXX
Phone: +XXXXXXXXXX /
+XXXXXXXXX
Fax: +XXXXXXXXXXX
Represented by: XXXX
37
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX, South Africa
Tel: +XXXXXXXXXXXXXX Fax: +XXXXXXXXXX
Please submit on official LOI and soft probe
authorization letter addressed to W. (Pty) Ltd, the seller, will
activate banking co-ordinates and full bank officer contact details for
similar soft probe authorisation
Seller Bank:
Standard Corporate & Merchant Bank – A Division of Standard Bank of
South Africa Limited
Address:
Account name: W.(Pty) Ltd
Account no.: to be advised on application of
complete LOI made out to Waysmart (Pty) Ltd
Phone:
Swift:
Bank Officer:
Email:
This contract is made by and between the BUYER
and the SELLER whereby the BUYER agrees to buy and the SELLER agrees to
sell the products specified in Clause 3.1 herein, on the terms and
conditions stated below:
CLAUSE 1 NAME OF
COMMODITY AND PORTS
Commodity: Iron Ore Fines (Fe
content: no less than 62,5%, as per Clause 3 herein)
Country of Origin: Brazil
Port of Loading: ………………., Brazil
Port of Destination: At the Buyer’s discretion,
based on the terms of this CFR contract
CLAUSE 2
DELIVERY PERIOD AND QUANTITY
Total Quantity:
........................DMT (+/- 10%) over .... years
Quantity per shipment: 150,000 DMT (+/- 10%) of
Iron Ore Fine per shipment
1. ........shipments
the first year (30 – 45 day intervals, based on Seller’s schedule)
2. Iron Ore Year means the period of twelve
months between April 1st. and March 31st.
3.
First shipment of Iron Ore is .........., 200.. – based on the date of
Letter of Credit Opening of ..............2004 – 150 days after the date
of the Letter of Credit is opened.
Shipment
Schedule: SELLER shall sell and deliver and BUYER shall take delivery
and pay for the quantities of Iron Ore under the terms herein below. The
shipment schedule for the first year of this Agreement will be as per
Clause 2, “Quantity per shipment” sub-item 1 herein and for the
following years as per Clause 10.2 herein.
Annual
Quantities:
Contract Year Annual Quantities (in
wet metric tons)
1st
2nd
3rd
4th
5th
6th
7th
8th
9th
2.1. The contract
quantities of Iron Ore above shall be delivered CFR spout trimmed
………………. Brazil, in accordance with INCOTERMS 2000.
2.2. The BUYER warrants to the SELLER the
purchase of the Iron Ore quantities per year described in Clause 2
herein, and the SELLER warrants to the BUYER the supply of such
quantities per Iron Ore Year.
2.2.1. If the BUYER
does not acquire and take delivery of the quantities per Iron Ore Year
agreed in Clause 2 herein, the BUYER shall indemnify the SELLER for the
full amount of the non-purchased quantity as if it had been actually
purchased, unless the BUYER gives notice to the SELLER at least ---days
prior to the following scheduled shipment date, setting forth its
intention of not purchasing a certain quantity of Iron Ore.
2.2.2. In the event that the BUYER gives prior
notice to SELLER reducing the Iron Ore quantity described in Clause 2
herein , then Buyer shall pay the SELLER a penalty equal to 20% of the
price of the non-purchased Iron Ore as money damages, and the SELLER
shall be free to sell such quantities of Iron Ore on the market.
2.2.3.. In the event the SELLER is unable to
supply the BUYER with the quantity of Iron Ore per year established in
Clause 2 herein, the BUYER shall have the right to purchase such
quantity on the market and SELLER shall not be liable for any damages
arising from such failure to supply, provided SELLER gives notice to the
BUYER at least --- days prior to the following scheduled shipment date,
stating its inability to provide the scheduled quantity of Iron Ore.
Failure to provide such prior notice shall subject SELLER to a penalty
equal to 20% of the price of the non-supplied quantity of Iron Ore .
CLAUSE 3 PRODUCT SPECIFICATIONS AND WARRANTIES
3.1 Product Specifications
ITEM EXPECTED(%) GUARANTEED(%)
Chemical Composition (on dry basis)
Fe 65.00 64.00 min.
P
0.060 0.080 max.
S 0,015 0,025 max.
SiO2 4.00 5.50 max.
Al2O3
0.80 1.50 max.
Mn 0.30 NG
LOI 0.70 NG
CaO 0.10 NG
MgO 1.10 NG
Na2O 0.010 NG
K2O 0.010 NG
Moisture
H2O 6.00 8.00 max.
ITEM
EXPECTED(%) GUARANTEED(%)
Size Distribution (on
natural basis)
>6.3 mm 10.0 15.0 max.
<0.15 mm 25.0 30.0 max.
NG
= Not guaranteed
The above guaranteed
specifications in respect to chemical composition, moisture and physical
composition shall be ascertained in accordance with the applicable ISO
procedures and shall apply to each shipment of Iron Ore.
3.2 Penalties
i. In the
event that P exceeds the guaranteed specification of 0.080%, SELLER
shall indemnify BUYER US$ 0.05 per dry metric ton for each 0.010% in
excess of 0.080%, fractions pro rata.
ii. In the
event that S exceeds the guaranteed specification of 0,025, SELLER shall
indemnify BUYER US$ 0.05 per dry metric ton for each 0.010% in excess of
0,025, fractions pro rata.
iii. In the event that
SiO2 exceeds the guaranteed specification of 5.50%, SELLER shall
indemnify BUYER US$ 0.05 per dry metric ton for each 1.00% in excess of
5.50%, fractions pro rata.
iv. In the event that
Al2O3 exceeds the guaranteed specification of 1.50%, SELLER shall
indemnify BUYER US$ 0.05 per dry metric ton for each 1.00% in excess of
1.50%, fractions pro rata.
v. In the event that
>6.3 mm exceeds the guaranteed specification of 15.0%, SELLER shall
indemnify BUYER US$ 0.15 per wet metric ton for such excess quantity,
fractions pro rata.
vi. In the event that <0.15
mm exceeds the guaranteed specification of 30.0%, SELLER shall indemnify
BUYER US$ 0.15 per wet metric ton for such excess quantity, fractions
pro rata.
vii. In the event that moisture content
exceeds the guaranteed specification of 8.00%, SELLER shall indemnify
BUYER the ocean transportation freight of such shipment for the quantity
of such excess moisture, at the rate of .10 cents (ten United States
cents) per metric ton.
3.3 Certificate of
Analysis
The Certificate of Analysis from
……………………….. is attached as an “Addendum” hereto , to substantiate and
warrant the above stated product specifications and warranties.
CLAUSE 4 PRICE
4.1 The
Price of the Iron Ore for any purchase taking place on or before March
31st, 2005 is …US$…75…PMT…..CFR, per Dry Metric Ton (DMT) spout trimmed,
……………, Brazil. Following such date the price will be determined
according to the procedure set forth in Clause 5.2 herein,
CLAUSE 5 PRICE ADJUSTMENT
5.1 With respect to Iron Ore and in consideration
of the product specification described in Clause 3 herein:
(i) Should SELLER deliver Iron Ore with 1% (one
percent) in excess of the guaranteed Fe %, SELLER shall be entitled to
receive fifty cents of US Dollars per dry metric ton, “pro rata”, for
each 1% delivered in excess.
(ii) Should SELLER
deliver Iron Ore with 1% (one percent) short of the guaranteed Fe %,
BUYER shall have the right to retain fifty cents of US Dollars per dry
metric ton, “pro rata”, for each 1% short delivered.
5.2 Prices of Iron Ore to be delivered under this
Supply Contract for the subsequent Iron Ore Years shall be adjusted
based upon the annual price revision rate (percentage variation) set
between the Major Brazilian Iron Ore Supplier – CVRD and major steel
mills for the relevant Iron Ore Year. This percentage variation is
usually published in newspaper and/or in the official CVRD website. For
the Iron Ore Year from April 1st, 2005 to March 31st., 2006 this price
revision will be based on the US$75 CFR price per dry metric ton, and
for the subsequent years the price revision will be based on the
previous Iron Ore Year price.
5.3 In case there
is no published CVRD or other Major International Iron Ore Producer (Rio
Tinto, BHP Billiton, Anglo American, others) annual price revision,
BUYER and SELLER shall negotiate in good faith and make their best
endeavors to reach price agreements for mutual benefit for subsequent
Iron Ore Years, at least thirty (30) days prior to the first shipment
date of the Iron Ore Year. For example: the price for the first shipment
of the Iron Ore Year 2005 (i.e. between April 1st. 2005 and March 31st.,
2006) must be agreed in writing by the Parties at least thirty (30) days
prior to the iron ore shipment scheduled for April 1st, 2005.
5,4 If price negotiations between BUYER and
SELLER are not concluded before the first shipment of Iron Ore in a
given year, the previous Iron Ore Year’s CFR price shall be
provisionally applied
5.5 Once the Parties agree
on a price for a given Iron Ore Year is reached between the parties, it
will retroactively apply to the previous tonnage shipped within that
Iron Ore Year, and SELLER shall be entitled to invoice BUYER for the
unpaid amounts. All and only vessels tendering their Notice of Readiness
at loading port within a certain Iron Ore Year shall be invoiced at such
Iron Ore Year’s price
CLAUSE 6 PAYMENT
6.1 The payment under this Contract shall be made
in United States Dollars.
6.2 Letter of Credit:
BUYER shall issue an irrevocable, transferable revolving documentary
letter of credit “DLC” in favor of the SELLER: according to the
requirements, in such amounts and on such dates as follows (which may be
amended by the parties in writing from time to time):
6.2.1 The Buyer will issue a non-operative DLC by
../.../200.. (allows 15 days variation)
6.2.2
CCME will issue a 2% Performance Bond to activate the DLC by
.../.../200.. (allows 15 days variation)
6.2.3
Each subsequent payment for each shipment (without deductions or set-off
unless otherwise agreed by the parties in writing) shall be effected in
full by the DLC as previously stated in Clause 6.1 and 6.2, negotiable
with a first class bank in South Africa and automatically activated
after a Performance Bond is issued in the form of a Bank’s draft by the
Seller within 10 working days of the receipt of the non-operative DLC.
Each Performance Bond shall be opened in favour of the Buyer amounting
to 2% (two percent) of the face value of each shipment.
6.2.4 In the event that the SELLER fails to
deliver in timely fashion the Iron Ore to BUYER , the total amount of
the Performance Bond - equal to 2% of the face value of the shipment -
shall be remitted to the BUYER upon written notification by the BUYER to
the Seller Bank about late delivery. The wording of the Performance Bond
and DLC are to be agreed between the Buyer’s bank and the Seller’s Bank
before activation of the DLC, payable at sight against the presentation
of shipping documents set forth in Clause 7 hereof, in accordance with
the following procedures:
6.2.4.1 SELLER shall be
under no obligation whatsoever to have the cargo of a shipment totally
or partially available for delivery, unless the DLC has actually been
established as per the content mutually agreed by SELLER and BUYER and
in accordance with the stipulations of the previous paragraph.
6.2.4.2 If BUYER delays to establish and advise a
DLC, as stipulated in Clause 6 hereof, SELLER shall have the right to
delay the acceptance, berthing and/or loading of the related shipment
until the DLC is advised and received by SELLER. In this case, any
additional time, risk and expense related to the vessel shall be borne
by BUYER’s and vessel shall have its lay time counted as from the
beginning of the loading operations.
6.3 The DLC
shall cover one hundred percent (100%) of the anticipated CFR amount of
the relevant shipments stipulated herein, calculated on the basis of the
contracted price as per Clause 4 hereof , the maximum quantity in dry
metric tons of the Iron Ore to be delivered in the relevant shipments.
The DLC shall allow for a ten (10) percent variation in CFR amount and
quantity.
6.5 The DLC shall come into full force
and effect immediately as of the date when said credit shall be notified
by the advising bank in South Africa, and shall be effective for 90 days
following the B/L date. If necessary, the validity of the DLC shall be
extended by BUYER in order to allow the performance of relevant
shipment(s).
6.6 All banking charges and
commissions incurred in connection with the DLC outside South Africa and
Brazil, including confirmation charges, shall be borne by BUYER.
6.7 The Seller shall provide copies of shipping
documents, bill of lading, invoices, and certificates as above
mentioned. Said documents shall be delivered by registered airmail or
air courier or facsimile to: ..........................as per the
address and coordinates herein stated.
CLAUSE 7
SHIPPING DOCUMENTS
7.1 Payment shall be promptly
made to SELLER under DLC for 100% (one-hundred percent) of the total
amount of the invoice for each shipment upon the presentation of the
following documents:
i. SELLER’s commercial
invoice in triplicate, based on the wet weight stated in the B/L and the
actual Fe and moisture contents stated in the Certificate of Analysis.
ii. Full set of 3/3 original B/L, clean on board,
issued to order, blank endorsed and marked “freight payable as per
charter party”, setting forth the weight in metric tons, evidencing
shipment from loading port to discharging port.
iii. Certificate of Weight in one original and
three copies issued by an independent surveyor, showing actual weight of
cargo certified by draft survey.
iv. Certificate
of Analysis in one original and three copies issued by an independent
surveyor, showing the results of the chemical composition test, size
distribution and moisture called for in contract.
v. Certificate of Origin in one original and
three copies issued by the Chamber of Commerce or Chamber of Commerce
and Industry in Brazil or other Local Authority.
vi. Copy of facsimile sent by SELLER to BUYER
within three (3) working days after shipment date advising shipment
details, including name of carrying vessel, name of Iron Ore,
approximate invoice amount , weight, DLC No. and B/L No. and date.
CLAUSE 8 WEIGHT DETERMINATION
8.1 At Loading Port:
8.1.1
For each shipment, weighing shall be effected at loading port by an
independent surveyor selected by SELLER and approved by BUYER, at
SELLER’s expenses. BUYER shall have the right to have its representative
(selected by BUYER and approved by SELLER) present and observe the
procedures for weight determination, at BUYER´s own cost and expense.
8.1.2 The weight will be determined by draft
survey, in accordance with international practice, and shall be the
basis for the respective Bill of Lading (hereinafter called B/L), and
also for the “Certificate of Weight” to be issued by an independent
surveyor.
8.1.3 SELLER shall send such
“Certificate of Weight” to BUYER by fax within three (3) working days
and by courier within seven (7) working days after B/L date.
8.1.4 The B/L weight shall be the basis for
invoicing.
CLAUSE 9 SAMPLING AND ANALYSIS
9.1 At Loading Port:
9.1.1
For each shipment, sampling as well as physical and chemical analysis
and moisture determination, shall be effected at loading port by an
independent surveyor selected by SELLER and approved by BUYER, at
SELLER’s expenses. BUYER shall have the right to have its representative
(selected by BUYER and approved by SELLER) present and observe the
procedures for sampling as well as for physical and chemical analysis
and moisture determination, at BUYER´s own cost and expense.
9.1.2 The independent surveyor shall issue a
Certificate of Analysis and SELLER shall send a copy of it together with
a copy of the “Certificate of Origin” to BUYER by facsimile within five
(5) working days after the Certificate of Analysis date. Within seven
(7) working days after the Certificate of Analysis date SELLER shall
send by courier to BUYER the originals of the “Certificate of Analysis”
and “Certificate of Origin”.
CLAUSE 10 SHIPPING
SCHEDULE & LOADING CONDITIONS
(CFR Spout Trimmed
……………., Brazil)
10.1 General Conditions:
10.1.2 SELLER shall load Iron Ore at the ……………….,
Brazil, at its own expense and risk on board of vessels provided by
BUYER. Such vessels, except when previously accepted by SELLER, shall
always load the maximum cargo at the ………………, considering the
restrictions imposed by the arrival draft at the discharging port.
10.1.3 SELLER shall provide for spout trimming at
its own time and expense, free of all risk and expense to BUYER and/or
vessels. In case of any damage to the vessel caused by SELLER, such
damage shall be settled directly between SELLER and Owners.
Item Pier ……
To be advised
on official LOI submitted to ...
10.1.5 The
SELLER shall instruct Master of Owners that vessels must be presented
for berthing with minimum ballast compatible with its respective
seaworthiness.
10.1.6 SELLER warrants that all
vessels nominated shall be classed highest Lloyds (+100 A1) or
equivalent, be seaworthy and fit for carriage of the intended cargo in
all respects and shall be so maintained for the duration of the voyage.
The vessel shall comply in every respect with all international and
local regulations in the port of loading and discharge and comply with
regulations governing the carriage by sea of iron ore/iron ore pellets
in bulk.
10.2 Shipping Schedule And Nomination Of
Vessels:
10.2.1 Shipping schedule:
Each shipment will be of 150,000 ton (+/- 10%) of
Iron Ore, limited to the ………………… dimensions clause – 10.1.4.
10.2.2 Quarterly shipping schedule, indicating
quantities, types, and the lay days for each shipment, shall be proposed
to BUYER by SELLER, at latest, thirty (30) days before the commencement
of each quarter. BUYER shall comment on this shipping schedule within 4
(4) working days. If unable to confirm the lay days of any shipment,
BUYER shall indicate another period in which lay days can be accepted.
10.2.3 If the arrival of any vessel is
anticipated or delayed outside the lay days agreed as per the previous
clause, acceptance of such vessel is subject to further consultation
between BUYER and SELLER.
10.2.4 Vessels have to
be finally nominated, at latest, thirty (30) days before the
commencement of its respective lay days, and shall be submitted to
BUYER’s approval. All relevant information for that approval shall be
provided to BUYER by SELLER in written documents. BUYER shall comment on
any vessel nomination, within five (5) working days after receiving the
written documentation from SELLER. BUYER shall not reject a vessel which
corresponds, with regards to quantity, type and lay days to a confirmed
stem of the monthly shipping schedule, provided that the vessel is
effectively in condition to receive the requested cargo.
10.2.5 SELLER shall have the right to substitute
the originally nominated vessel by another of similar size and same lay
days, provided that the substitute vessel is also effectively in
condition to receive the requested cargo. The substituted vessel shall
be approved by SELLER as stated in Clause 10.2 (”Shipping Schedule and
Loading Conditions”), sub-clause 10.2.4.
10.3
Notices Of Arrival:
10.3.1 On sailing from the
preceding port, Master, Owners and SELLERS shall inform the BUYER
…………………., by telex or fax, the expected time of arrival (ETA) of each
vessel.
10.3.2 Such information shall be updated
fourteen (14) days, eight (8) days, three (3) days, two (2) days and one
(1) day before the vessel’s expected arrival at …………., or at any time
upon BUYER’s request.
10.3.3 The fourteen (14)
days, eight (8) days, two (2) days and one (1) day notice shall be also
transmitted by Master, Owners and/or SELLER to BUYER.
10.3.4 Master, Owners and/or SELLER shall, with
the eight (8) days notice, also inform BUYER about the vessel’s cargo
plan, and provide the following details:
i)
Arrival and departure drafts;
ii) Air draft
(distance from water line to the top of the hatch comings);
iii) Amount of ballast on arrival and, if in
cargo holds, how distributed;
iv) Time required
for deballasting after berthing;
v) Loading
sequence; and
vi) Information on whether a “Gas
Free” certificate is required or not.
10.4 Notice
Of Readiness:
10.4.1 Notice of Readiness (NOR)
may be tendered after arrival of vessel at the Inner Harbour area,
including the Inner Anchorage area, of loading port, at any time,
irrespective of official office hours, Saturdays, Sundays and Holidays
included, whether the vessel is in berth or not, provided that the
vessel is within the agreed lay days, in free “pratique”, gas free,
cleared by Port Authorities and ready to receive cargo in every respect,
otherwise Notice of Readiness will be cancelled and a new NOR shall be
tendered and accepted. However, if vessel is compelled to wait for berth
at the Outer or at the Intermediary Anchorage area on vessel’s arrival
due to unavailability of space at the Inner Anchorage area, Notice of
Readiness may be tendered after arrival of vessel at the Outer or at the
Intermediary Anchorage area at any time irrespective of official office
hours, Saturdays, Sundays and Holidays included, provided that the
vessel is in free “pratique”, gas free, cleared by Port Authorities and
ready to receive cargo in every respect, otherwise Notice of Readiness
will be cancelled and a new NOR shall be tendered and accepted.
CLAUSE 11 INSURANCE
It
shall be a BUYER’s responsibility to effect, at its own account, cargo
insurance on each shipment of Iron Ore. These insurance documents must
be presented in a contractual format from the insurer for the full
duration of this contract to the SELLER.
CLAUSE
12 TRANSFER OF TITLE & RISK
12.1 Transfer of
title and risk with respect to the Iron Ore in each shipment shall pass
from SELLER to BUYER when the Iron Ore in each shipment has been loaded
on board a vessel at loading port, in accordance with INCOTERMS 2000.
CLAUSE 13 LOSS OF CARGO
13.1 In the event of total or partial loss of
cargo prior to the completion of loading operations, BUYER undertakes to
pay SELLER at the price agreed upon in Clause 4 of this Supply Contract
based on the weight of cargo actually loaded on board the vessel at the
time of such loss, as measured by the loading scales at the loading
port, and the expected Fe and moisture contents for Iron Ore as
specified hereof this contract.
CLAUSE 14 TAXES
14.1 Taxes and dues levied on the Iron Ore or on
this Supply Contract in the country of origin shall be for MINE OWNERS
account.
14.2 Taxes and dues levied on the Iron
Ore or on this Supply Contract out of the country of origin shall be for
BUYER’s account.
CLAUSE 15 DEFAULT
15.1 If either party hereto shall fail to perform
or fulfil, at the time and in the manner herein provided, any obligation
or condition required to be performed or fulfilled by such party
hereunder, and if such party fails to remedy any failure within ....
days after written notice thereof has been given to it by the other
party, the non-defaulting party shall have the right to terminate this
contract by giving written notice of termination to the defaulting
party.
CLAUSE 16 FORCE MAJEURE
16.1 Neither BUYER nor SELLER shall be liable for
delay for failure in performing all or any part of this Supply Contract,
to the extent that its performance has been obstructed, due to a Force
Majeure Event. As used herein, a “Force Majeure Event” shall mean an
event beyond the reasonable control of the affected party, including but
not limited to strikes, lockouts, floods, Acts of God, war, embargo,
civil commotion and other causes beyond the reasonable control of BUYER
or SELLER, and including where such event arises at the loading port or
discharge port. Force Majeure Events hereunder also include an outage or
curtailment at SELLER’s relevant mines, ports, plants and railroads
which is due to (a) accident, safety requirements or prudent practice to
avoid accident or (b) a Force Majeure Event that occurs at BUYER’s or
SELLER’s suppliers or customers.
16.2 No event
described in Clause 16.1 shall constitute a Force Majeure Event with
respect to BUYER’s obligation to pay for any Iron Ore loaded at loading
port in Brazil or in transit to BUYER.
16.3 In
the event that a Force Majeure Event occurs or is anticipated, the party
directly affected shall advise the other by cable, telex or facsimile as
promptly as possible. In case that either BUYER or SELLER declares a
Force Majeure Event the party declaring a Force Majeure Event shall
submit a written advice of the Force Majeure Event, with evidence and
explanation that its performance has been or may be prevented or delayed
due to a cause covered by Clause 16.1. Such written advice with evidence
and explanation shall be submitted as promptly as practicably possible
and in any event not later than ten (10) days after occurrence of such
Force Majeure Event.
16.4 Should the cause of a
Force Majeure Event last three (3) months or less, tonnage outstanding
owing to such Force Majeure Event shall be delivered and accepted after
the cause of such Force Majeure Event has ceased to exist over a period
to be agreed between BUYER and SELLER in accordance with their
capabilities. BUYER will make best efforts to accept and SELLER will
make best efforts to ship said tonnage in the same contractual year. If
no such agreement is reached, tonnage outstanding owing to Force Majeure
will be carried over to the end of contract or other mutually agreed
upon time period.
16.5 Should the Force Majeure
Event last longer than three (3) months, the party so advised of the
Force Majeure Event may, at its option, cancel the tonnage which could
not be delivered and accepted; provided, however, that if such tonnage
are not cancelled, such tonnage shall be delivered and accepted after
the cause of the Force Majeure Event has ceased to exist, in accordance
with Clause 16.4 of this Supply Contract.
CLAUSE
17 DISPUTE RESOLUTION.
17.1 Within ten (10)
Business Days of the service of a written request of any Party to this
Agreement (a “Notice of Dispute”), the Parties shall meet to negotiate
in good faith a resolution of any Dispute.
17.2
Any Dispute which cannot be resolved pursuant to Clause 17.1, shall be
referred to and finally resolved by arbitration conducted in accordance
with the Arbitration Rules of the International Arbitration Court of the
International Chamber of Commerce – ICC (“ICC”). The Rules are
incorporated by reference. Notwithstanding anything to the contrary
herein, any proceeding in a court in Brazil relating to the arbitration
provisions set forth herein, and any arbitration conducted thereunder,
shall be governed exclusively by the Arbitration Act (Law 9307/96), as
amended from time to time, to the exclusion of any other Brazilian state
or municipal law of arbitration.
17.3 If a
Dispute cannot be resolved pursuant to Clause 17.1 within twenty (20)
Business Days of the service of the Notice of Dispute, then any party to
the Dispute (a “party”) may serve a written request that it intends to
invoke this arbitration clause and seek arbitration of the Dispute (a
“Notice of Arbitration”). On the tenth (10th) Business Day following the
date on which the final arbitrator is chosen pursuant to Clause 17.4
(iv), the parties shall execute an arbitral compromise (compromisso
arbitral) referring such Dispute to arbitration as provided for in the
Arbitration Act. The Notice of Arbitration shall indicate the time and
place the parties shall meet to sign the arbitral compromise.
17.4 The arbitral compromise shall incorporate
all the provisions of this Clause 17 and contain the information
required pursuant to articles 10 and 11 of the Arbitration Act,
including the following:
(i) A description of the
matters under Dispute which are being referred to arbitration:
(ii) The appointment of the International
Arbitration Court of the International Chamber of Commerce – ICC (“ICC”)
as the administrator and, in case one of the parties to the Dispute
fails to appoint its arbitrator, the appointing authority.
(iii) The place of the arbitration shall be in
the city of ……………., Brazil. The language of the arbitration shall be
Portuguese. Notwithstanding the foregoing, any party may submit
testimony or documentary evidence in English, provided that the party
submitting such evidence, at its own cost, also furnishes to the other
parties and the arbitrators a translation in Portuguese.
(iv) The arbitration shall be conducted by three
(3) arbitrators. If a Dispute has two parties, each party shall appoint
one arbitrator, obtain its appointee's acceptance of such appointment,
and deliver written notification of such appointment and acceptance to
the other party within thirty (30) Business Days after delivery of the
Request for Arbitration. In the event a party fails (i) to appoint an
arbitrator or deliver notification of such appointment to the other
parties within this time period or (ii) the parties to a Dispute with
more than two parties fail to agree that they represent two separate
sides, upon request of any party, such arbitrator or arbitrators, as the
case may be, shall instead be appointed by the ICC within twenty (20)
Business Days of receiving such request. The two arbitrators appointed
in accordance with the above provisions shall appoint the third
arbitrator, obtain the appointee's acceptance of such appointment and
notify the parties in writing of such appointment and acceptance within
twenty (20) Business Days of their appointment. If the first two
appointed arbitrators fail to appoint a third arbitrator or notify the
parties of that appointment within this time period, then, upon request
of any party, the third arbitrator shall be appointed by the ICC within
twenty (20) Business Days of receiving such request. The third
arbitrator shall serve as Chairman of the Tribunal.
(v) The award shall be made and payable in Reais.
The arbitrators are authorized by the parties to award pre-award and
post-award interest at LIBOR.
(vi) The costs of
arbitration, including reasonable legal fees, shall be borne by either
or both of Parties in whatever proportion as the arbitrators may award.
(vii) The arbitrators are not authorized to
render the award based on equity.
17.5 By
agreeing to arbitration, the Parties do not intend to deprive any court
with jurisdiction of its ability to issue a preliminary injunction,
attachment or other form of provisional remedy in aid of the arbitration
and a request for such provisional remedies by a party to a court shall
not be deemed a waiver of this agreement to arbitrate. In addition to
the authority conferred upon the arbitral tribunal by the rules
specified above, the arbitral tribunal shall also have the authority to
grant provisional remedies, including injunctive relief.
17.6 Each party shall produce relevant,
non-privileged documents or copies thereof requested by the other party
within the time limits set by the arbitral tribunal. Any dispute as to
the relevance of material, or any other dispute of whatever nature
arising out of or connected with or related to discovery of material
shall be determined by the arbitral tribunal.
17.7 Notwithstanding Article 32 of the
Arbitration Act, each Party hereby irrevocably waives to the fullest
extent permitted by law and excludes all rights of appeal, challenge, or
recourse to any court from any arbitral award or Order resulting from
any arbitration conducted under this Clause 17 (except for initiating
Actions or Proceedings to obtain a judgment recognizing or enforcing an
arbitral award or Order and except for Actions or Proceedings seeking
interim, interlocutory or other provisional relief in any court having
jurisdiction, but only on the ground that the award to which the
applicant may be entitled may be rendered ineffectual without such
provisional relief), and each Party agrees that judgment on any arbitral
award or Order resulting from an arbitration conducted under this Clause
17 shall be final, conclusive and binding on the parties.
17.8 The Parties agree that the matters that are
the subject of this arbitration agreement are commercial transactions
and agree to waive and not to claim any immunity from suit, execution,
pre judgment or post judgment attachment, or other legal process in any
jurisdiction in connection with a Dispute.
17.9
Unless required by law, the parties otherwise agree, or the arbitrators
otherwise order:
(i) All hearings in the
arbitration shall be private.
(ii) No information
concerning or relating to the existence of the arbitration may be
disclosed to any third party except for those participating in the
arbitration.
(iii) Any documentary or other
evidence given by a party or a witness in the arbitration shall be
treated as confidential and shall not be disclosed to any third party
except for those participating in the arbitration.
(iv) All documents submitted for the purpose of
the arbitration shall be treated as confidential and shall not be
disclosed to any third party except for those participating in the
arbitration.
(v) All awards and orders of the
arbitrators shall be treated as confidential and shall not be disclosed
to any third party.
(vi) Before appointment, an
arbitrator, expert, and others participating in the arbitration
(including witnesses) shall agree to comply with this provision on
confidentiality.
(vii) Notwithstanding these
provisions on confidentiality, a party may disclose a matter, or
information relating to the arbitration for purposes of recognizing, or
enforcing an award or for purposes of protecting a right against a third
party, but the party must request that any person receiving the
information keep it confidential.
17.10 Each of
the Parties hereby consents to the jurisdiction of any court, in any
country of competent jurisdiction, having jurisdiction over any Party or
any of its assets, and any appellate court from any thereof, for the
enforcement of arbitral awards and in aid of arbitration the arbitral
process, and waives to the extent permitted by applicable lave any
defense opposition to such jurisdiction.
CLAUSE
18 GOVERNING LAW
18.1 This Supply Contract shall
be governed by the laws of Brazil
CLAUSE 19
ASSIGNMENT
19.1 Neither BUYER nor SELLER may
assign this Supply Contract, in whole or in part, without prior written
consent of the other.
CLAUSE 20 WAIVER
20.1 No waiver of any breach of this Supply
Contract or of any of the provisions hereof shall be effective unless
such waiver is made in writing, nor shall any such waiver be deemed a
waiver of any other or subsequent breach hereof.
CLAUSE 21 SEVERABILITY
21.1 If any provision of this Supply Contract or
the application thereof to any party hereto, is held illegal,
unenforceable, or otherwise invalid by government promulgation or court
decree, such holding shall not affect the other provisions or
applications of this Supply Contract which can be given effect without
the invalid provision.
CLAUSE 22 AMENDMENT OF THE
CONTRACT
22.1 This Supply Contract may not be
modified or amended except with the mutual consent of the parties
expressed in a written instrument signed by a duly authorized
representative of each of SELLER and BUYER.
CLAUSE 23 CONFIDENTIALITY
23.1 It is a fundamental term of this contract
that the parties shall not disclose the terms hereof to any person,
except in so far as disclosure is necessary for the effective
performance by the either party of these respective obligations
hereunder.
CLAUSE 24 ENTIRE CONTRACT
24.1 This Supply Contract constitutes and
contains the entire and only agreement between the parties hereto with
respect to the subject matter hereof and supersedes and mutually cancels
any and all pre-existing agreements and understandings between the
parties relating to the subject matter hereof, whether oral or written,
and any proposed additional or different terms contained in SELLER’s or
BUYER’s communications and not specifically accepted in writing by the
other party hereto are hereby objected to without further notice. No
representation, inducement, promise, understanding, condition or
warranty not set forth herein has been made or relied on by either
party.
CLAUSE 25 TERM
25.1
This Supply Contract shall become effective when signed by both parties
and shall remain in full force and effect until the earlier of the end
of the supplies herein agreed by the Parties or the last day of the last
Iron Ore Year.
CLAUSE 26 TERMINATION
26.1. - Anything contained herein to the contrary
notwithstanding, this contract may be terminated and the transactions
contemplated hereby abandoned at any time prior to the termination date.
(a) by mutual written consent of the parties
hereto; or
(b) by a party if the other party has
materially breached; or
(c) if any of the parties
is declared insolvent, bankrupt or requires a creditors reorganization
(concordata).
26.2. - In the event of termination
due to a breach by a party, the other party shall be entitled to losses
and damages.
CLAUSE 27 NOTICES
27.1 Unless otherwise stipulated in this Supply
Contract or its Addendums, all notices required or authorized to be
given under this Contract shall be in writing and sent via facsimile
addressed as follows:
If to SELLER:
XXXXXXXXXXXXXXXX
XXXXXXXXXX
Fax:
+XXXXXXXXXXXXXX
Email: XXXXXXXXXXXXX
Attention: XXXXXXXXXXXXXX
If to BUYER:
ADDRESS
CITY
Fax Number:
e-mail:
Attention: ]
28 OTHER:
28.1 Any matter
that is not covered by this Supply Contract shall be decided by mutual
agreement between BUYER and SELLER.
IN WITNESS
WHEREOF, this Supply Contract has been executed by and between BUYER and
SELLER in two (2) originals signed by their duly authorized officers,
both in English language and equally valid, one (1) original to be
retained by BUYER and one (1) original to be retained by SELLER.
For and on behalf of: For and on behalf of:
Client
_______________________________
For and on behalf of:
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