marine terminal services agreement port of houston authority

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MARINE TERMINAL SERVICEAGREEMENT 201195PORT OF HOUSTON AUTHORITY ANDCIA SUDAMERICANA DE VAPORES S.A.and the private lessee-operated empty container facility on PHA property within BarboursCut Terminal as designated by Carrier, to meet vessel movements as reasonably designatedby Carrier, subject to the ability of the empty container facility to accommodate suchmovements (the "PHA Empty Container Services"). Except for such empty handling charges(and discounts) specifically provided for herein, all rates and services to be provided inconnection with the empty container yard services shall be negotiated and contractedseparately between Carrier and its designated empty container yard facility operator, providedthat the terms of such rates and services shall be subject to the restrictions contained inPHA's lease with such private empty container facility operator, including without limitationthe permitted capacity of such empty container facility. PHA shall not require any increasein such rates in excess of amounts required to adequately provide empty container yardservices. PHA's lease with such private empty container facility operator shall provide thatany annual increase in rates for empty container yard services shall not exceed the greater offive percent (5%) ofthe rate then in effect, or the Cost Adjustment applied to the rate then ineffect.b. The parties agree that PHA shall provide the PHA Empty Container Servicesto Carrier commencing on January 1, 2008. However, the parties recognize that PHA willneed an implementation window through March 31, 2008 to establish effective emptycontainer yard operations at Barbours Cut Terminal under Section 4(a) and it shall not be anEvent ofDefault hereunder ifthe PHA is unable to do so during that window period. In theevent PHA does not provide the PHA Empty Container Services to Carrier during any monthcommencing April 1, 2008 or thereafter, it shall not be an Event of Default hereunder,provided however, that the following month PHA shall credit Carrier with the EmptyContainer Service Credit against amounts the Carrier owes the PHA that month. The EmptyContainer Service Credit shall equal One Hundred Thousand Dollars ($100,000) multipliedby a fraction, the numerator ofwhich equals Carrier's loaded container volume at BarboursCut Terminal during the month that PHA did not provide the Empty Container Services toCarrier, and the denominator equals the total loaded container volume handled at BarboursCut Terminal during such month.c. Carrier may at its option obtain services for depot services and maintenanceand repair work for empty refrigerated containers and tanks outside ofthe designated emptycontainer facility on PHA property, provided such vendor meets required labor standards asoutlined in the International Longshoremen's Association, AFL-CIO master contracts.Carrier may dispatch empty refrigerated containers and tanks directly from Barbours CutTerminal and exempt such empty refrigerated containers and tanks from being moved to andfrom the designated empty container facility on PHA property, as reasonably requested.5. Cargo Commitment.a. Movement of Loaded Containers. During the term hereof, that portion ofCarrier's loaded containers in ocean transportation in the foreign commerce of the UnitedStates, that are to be delivered to or loaded at the Terminal Region (as hereinafter defined),Page 6
MARINE TERMINAL SERVICEAGREEMENT 201195PORT OF HOUSTON AUTHORITY ANDCIA SUDAMERICANA DE VAPORES S.A.shall be moved by Carrier exclusively through the Terminals (the "Cargo Commitment").The Cargo Commitment shall include Carrier's containers that are carried on Shared Vessels.b. Terminal Region. The "Terminal Region" means destinations served by allports along the Texas coast, including Galveston Bay, beginning with the port ofBeaumont,to and including the port of Freeport.c. Other Containers.i. The Cargo Commitment shall not encompass any of Carrier'scontainers that are carried on other container ships operated by or on behalf of any thirdparty, including but not limited to Carrier's vessel sharing partners, but not including CarrierRelated Parties (as defined below) ("Other Containers"), provided that such Other Containersshall not exceed five percent (5%) ofCarrier's loaded containers delivered to or loaded at theTerminal Region.ii. In the event that during any Determination Period the number ofOtherContainers exceed five percent (5%) ofCarrier's loaded containers delivered to or loaded atthe Terminal Region, it shall not be an Event of Default hereunder, provided that Carriershall pay to PHA the "Other Container Amount" as hereinafter provided. The PHA shalldetermine and bill Carrier the Other Container Amount for the previous DeterminationPeriod on or after January 1 and July 1 of each year.lll. The Other Container Amount shall equal the Loaded Throughput BaseRate in effect for the applicable Determination Period, multiplied by the difference betweenthe total number of Other Containers during such Determination Period, less five percent(5%) of Carrier's loaded containers delivered to or loaded at the Terminal Region duringsuch Determination Period.6. Applicability of Agreement. The rights of Carrier to obtain the CommitmentDiscount and obligation of Carrier to perform the Cargo Commitment shall apply to theocean transportation in the foreign commerce ofthe United States of Carrier, subject to theterms of Section 5(c). Additionally, it shall be deemed a breach of the Cargo Commitmentby Carrier ifloaded containers in ocean transportation in the foreign commerce ofthe UnitedStates (other than Other Containers, as provided in Section 5(c)), to be delivered to or loadedat the Terminal Region, are not moved exclusively through the Terminals, by Carrier's directand indirect parents, affiliates, and subsidiaries, entities otherwise related to Carrier, throughdirect or indirect ownership or power to control the other's equity interests, and by entitiesdoing business as "CIA. SUDAMERICANA DE VAPORES" or "CSAV", "LIBRA,""NORASIA," "CSVV" or "CSAV GROUP NORTH AMERICA" ("Carrier RelatedParties"). The Cargo Commitment shall also apply to loaded containers on any vesseloperated by or on behalf of any ofvessel sharing partners of Carrier Related Parties.7. Events ofDefault. Notwithstanding any provision to the contrary in the Tariffs, eachof the following occurrences shall constitute an "Event of Default" by a party under thisPage 7
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marine terminal services agreement port of houston authority

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