CONTRACT FOR SALE AND PURCHASE OF ******* IRON ORESbetweenXXXXXXXXXXXXXXXXandDated:CONTRACT FOR SALE AND PURCHASE OFINDIAN IRON ORE FINESContract No.：xxxxxxxxThis Contract is made on*****, 2012by and between ***********(hereinafter called "Seller") and Bright Ruby Resources Pte limited (hereinafter called "Buyer"), whereby Seller agrees to sell to Buyer and Buyer agrees to buy from Seller Iron Ores on the following terms and conditions.Article 1. DEFINITION:In this Contract the following terms shall, unless, otherwise context requires, have the following meanings:(1)"Metric ton" means one thousand (1,000) kilograms.(2)―Wet metric ton‖ or ―WMT‖ means a metric ton determined on wet basis. ―Dry metric ton‖ or―DMT‖ means a metric ton of Ore on dry basis. ―Wet basis‖ or ―Natural wet basis‖ refers to fines in natural wet state. "Dry basis" refers to Fines dried at 105 degrees centigrade.(3)"Dollar(s)" or the sign "$" and "Cent(s)" or the sign "¢" respectively mean dollars and cents in thefreely transferable lawful currency of the United States of America.(4)―Iron Ore Fines‖ or ―Ore‖ mean the processed iron ore Fines.Article 2. COMMODITY:****** Iron Ore FinesCountry of Origin: *******Packing: In bulkPartial Shipment: Not AllowedCombines shipment: Not allowedTransshipment: Not AllowedArticle 4. SHIPMENT PERIOD:Laycan:Latest date of shipment: *******Article 5. LOADING AND DISCHARGING PORT:Loading Port ：****************Discharging Port ：**********port, P.R.China (or any main Chinese port at buyer’s option)(The final discharging port shall be declared by Buyer upon the vessel passes the Singapore, or within 5 working days after the date of vessel sail out from loading port.)Article 6. GUARANTEED SPECIFICATIONS:(1) Chemical Composition: (on the dry basis)Iron (Fe) 58.00% basis/ 57minimumBelow 57.00% RejectionAlumina (Al2O3) *.00% maximumSilica (SiO2) *.00% maximumSulphur (S) 0.0*% maximumPhosphorus (P) 0.0*% maximum(2)Free Moisture Loss at 105゜Centigrade: 10.0% maximum(3)Physical Composition: (on natural basis)0mm — 10mm **% minimumOversize +10mm **% maximumUndersize －0.15mm **% maximumArticle 7. BASE PRICE:USD**** PDMT CFR FO *****, P.R.CHINA, BASED ON 58% FE ON THE DRY BASIS IN RESPECT OF FINES, FRACTION PRO RATA, and adjusted if applicable under article 8 below(Such price already includes the taxes and duties levied in country of origin, if any subsequent tax/duties increase levied, it shall be borne by the Seller itself)Article 8. PRICE ADJUSTMENT:A)FE contentIn respect of the shipment of iron Ore which does not meet the FE specification set forth in Article 6, the base price referred to in Article 7 shall be adjusted in accordance with FE content as determined pursuant to the provision of Article 10 as follows:1)If Fe above 58.00%, the base price shall be increased by US$2.50per DMT for each 1% of Fe,fraction pro rata.2)If Fe below 58.00%, down to and including 57%, the base price shall be decreased byUS$4.00per DMT for each 1% of Fe, fraction pro rata.3)If Fe content is below 57%, the price adjustment as mentioned above in this Article is notapplicable. Instead, in this case, the Buyer is entitled to reject the Ore if FE content is below 57% either basis loading port analysis arranged by Seller or Buyer’s loading port analysis at loading port or CIQ certificate arranged by Buyer at discharging port. Without prejudice to Buyer’s rights of reject the cargo, both parties shall discuss and negotiate a new price in amicable manner to settle this off-spec cargo. If no price agreement can be reached within 5 working days upon the date of CIQ certificate is provided by Buyer to Seller, then Buyer’s right of rejection shall be exercised in such manner:a)Within 10 working days upon the date of CIQ c is provided by Buyer to Seller, the Sellershould refund and/or repay to the Buyer all the incurred payments and costs to exchangethe relevant shipping documents. Seller agrees that the Buyer is entitled to retain the Oreat Seller’s risk until the Buyer has been fully reimbursed by the Seller of all the paymentsand costs, including but not limited to the provisional payment paid under letter of creditby the Buyer, L/C opening charges, negotiation banking charges, insurance, portdisbursement, storage charges, customs VAT, and pro-rated interest at [ 3.5 ]% perannum on the provisional payment and above mentioned costs and expenses, and otherlosses due to Seller’s such failure to deliver Contractual quality Ore.b)In case the aforesaid payments and costs are not received by Buyer within the 10 workingdays, it is agreed by both parties that the Buyer has right to retain the cargo back, and inBuyer’s sole and absolute discretion re-sell the Ore by any appropriate means to a thirdparty at a price, which Seller hereby unconditionally and irrevocably agree is the marketprice. Such resell price shall also be considered as final settlement price for both parties tosettle this off-spec cargo.c)The Buyer are entitled to claim against Seller for the difference between the cargo valuebasis the final settlement price and the provisional payment as stipulated in article 11(2).Such difference must reimbursed by Seller to Buyer wihin 7 working days upon Buyer’snotice of reselling the shipment of ore and issuance of debit note. In addition, the Buyerreserves the right to claim all other losses and damages arising from the Seller’s suchdefault.B)Physical composition1)Oversized Ore:If the Fines above 10 mm exceeds the guaranteed maximum of **% set forth in Article 6. (3), the base price shall be decreased at the rate of US$0.50 per WMT for the excess part of fines, fraction prorata2)Undersized Ore:If the Fines below 0.15mm exceeds the guaranteed maximum of **% set forth in Article 6.(3), the base price shall be decreased at the rate of US$0.50 per WMT for the excess part of fines, fraction prorataC)Other chemical composition:If the shipment does not meet any of the chemical specifications other than FE provided in Article 6(1) the base price shall be decreased, fraction pro rata as follow:1)Alumina (Al2O3):At the rate of 0.05U.S. Dollars per DMT for each 1% in excess of *.0%, fraction prorata2) Silica (SiO2):At the rate of 0.05U.S. Dollars per DMT for each 1% in excess of *0%, fraction prorata3) Sulphur (S):At the rate of 0.05U.S. Dollars per DMT for each 0.01% in excess of 0.0*%, fraction prorata4) Phosphorus (P):At the rate of 0.05U.S. Dollars per DMT for each 0.01% in excess of 0.0*%, fraction prorataArticle 9. WEIGHING1) At the loading port an independent surveyor, M/s SGS Private Limited (hereafter called ―SGS‖),at Seller’s expense shall determine the weight of shipment of Ore by draft survey. The weight of Ore as ascertained and certified together with SGS’s analysis shall be the basis of Seller’s provisional invoice as stipulated in article 11(2). Buyer may at Buyer’s expense have its representative(s) present during the draft survey.2) B uyer shall, at Buyer’s expense apply to the China Entry-Exit Inspection Quarantine Bureau (hereaftercalled ―CIQ‖) for weighing at the port of discharge. The weight of shipment at the discharge port is to be ascertained by draft survey. The weight thus determined by CIQ shall be final as to wet quantity of the shipment of ore for Seller’s final invoice. The dry quantity shall be determined by deducting the free moisture loss referred to in Article 10 from such wet quantity. Seller may at Seller’s expense have its representative(s) present during the draft survey.3) If no draft survey is performed at the discharge port, Seller’s weight certificate at loading port asstipulated in article 9(1) will be regarded as final.Article 10. SAMPLING AND ANALYSIS1) At the loading port, M/s SGS India Priva te Limited (hereafter called ―SGS‖) shall at the Seller's expensedetermine in accordance to the ISO procedures the chemical, moisture and physical specifications of the Ore and shall provide/produce a certificate showing details of the determination which shall include each of the chemical elements referred to in Article 6 above, free moisture loss at 105°Centigrade and sizing analysis.Buyer may at Buyer's expense have its representative present at the time of such determination.2) In addition to the above determination arranged by Seller, the Buyer may at Buyer's own expenseappoint an independent surveyor to conduct sampling and analysis on the Buyer's behalf (hereafter called"the Buyer's load port analysis"). The Seller must furnish the Buyer with all information reasonably required by the Buyer for the Buyer's load port analysis and use its best endeavours to assist the Buyer in ensuring that the Buyer's load port analysis is carried out. If the Seller fails to furnish the Buyer with all information reasonably required by the Buyer or to use its best endeavours as aforesaid, 1) the Buyer has the right to terminate this contract by giving notice to the Seller and to recover from the Seller liquidated damages in accordance with Article 22 below, and 2) any monies paid to the Seller by the Buyer in respect of the shipment the subject of the contract shall be returned to the Buyer forthwith, 3) any incurred costs already paid by Buyer or any possible costs to be paid by Buyer shall be reimbursed by Seller or to be repaid by Seller for Buyer; and 4) Buyer has no obligation to pay Seller for any invoiced bill once this contract is terminated by Buyer’s notice.If the Buyer's load port analysis shows Fe below 57% rejection, 1) the Buyer has the right to terminate this contract by giving notice to the Seller and to recover from the Seller liquidated damages in accordance with Article 22 below, and 2) any monies paid to the Seller by the Buyer in respect of the shipment the subject of the contract shall be returned to the Buyer forthwith, 3) any incurred costs already paid by Buyer or any possible costs to be paid by Buyer shall be reimbursed by Seller or to be repaid by Seller for Buyer; and 4)Buyer has no obligation to pay Seller for any invoiced bill once this contract is terminated by Buyer’s notice.3) At the port of discharge CIQ shall, at Buyer’s expense, take sample from the shipment and divide itinto two parts, one for CIQ’s analysis, and the other for possible umpire analysis as stipulated in article 10(4) which shall be sealed and kept by CIQ. CIQ shall analyze the sample for Buyer after completion of discharge of the cargo, and issue/produce the CIQ certificate. Buyer should promptly forward to Seller by fax or email such CIQ certificate within sixty (60) days after completion of discharge. CIQ’s certificate analysis shall be final and binding on both parties, and shall be basis for the Seller’s final invoice, except as otherwise provided for in Article 10(4).4) If the difference in percentage of F e content between CIQ’s and SGS’s certificate analysis made underArticle 10 (1) and 10 (3) of this Article is more than 1.0% or if there exists a significant difference of more than 1% between the two said analysis in respect of any one or more chemical contents other than FE, Seller shall consult with Buyer to reconcile such differences. If after consultation, the difference cannot be reconciled between Seller and Buyer within 14 days upon the date of CIQ certificate is provided by Buyer to Seller via email or fax, then at the request of Seller or Buyer, the sample for umpire analysis kept by CIQ stipulated in Article 10(3) shall be analyzed by an agreed umpire between Buyer and Seller. The certificate of analysis issued by such umpire shall be final for FE and/or other relevant chemical content on which in dispute.The umpire request shall be made in writing by Seller or Buyer, within 15 days after CIQ certificate has been provided by Buyer to Seller, failing which CIQ certificate is final and binding on both Parties. The umpire assayer shall be agreed and appointed within 14 days after written request of Seller or Buyer has been made, otherwise CIQ certificate is final and binding on both parties.The umpire in default shall be the following umpire laboratory:Alfred H. Knight International Ltd.Eccleston Grange, Prescot Road, St. HelensMerseyside WA10 3BQENGLANDOrAlex Stewart (Assayers) Ltd.Caddick Road, Knowsley Industrial Estate, KnowsleyMerseyside L34 9ERENGLAND5) If no analysis is carried out at the port of discharge, SGS’s certificate at the loading port shall beconclusive as to analysis of Ore.6) The weighing, sampling, chemical analysis, moisture determination and screen analysis performed atthe discharge port by CIQ s hall be for Buyer’s account.7) The cost of the umpire analysis shall be for the account of the party whose own analysis differs furtherfrom the umpire analysis, and if the result of such umpire analysis is the mean of CIQ’s analysis and the SGS’s analysis then such cost shall be equally borne by both parties.Article 11. PAYMENT1) Letter of CreditBuyer shall establish an irrevocable, non-transferable, at sight Letter of Credit (hereafter calledas the ―L/C‖) in favor of Seller to cover 100% value of the shipment within 5/7 working daysafter the Contract is signed by both Parties.LC advising bank shall be as follows.Name: XXXXXXXXX BANKAddress: XXXXXXXXXXXXXXXXXXXXXXXXXXSWIFT: XXXXXXXX(2) Provisional PaymentThe said Letter of Credit shall be available against the Seller’s draft at sight by opening bank forprovisional payment for the amount of ninety five (95) percent of the value of the shipmentaccompanied by the documents as stipulated below in this Article within 21 days after shipmentdate. The weight certificate issued by SGS at loading port together with the certificate ofanalysis of sample and of the percentage of free moisture loss at 105 degree centigrade atloading port issued by SGS shall be the basis for the Se ller’s provisional invoice:a) Seller’s signed provisional invoice covering 95% CFR shipment value in one (1)original and three (3) copies, indicating the Contract number, L/C number, name ofcarrying vessel, CFR value of the shipment and B/L date and number.b) Certificate of weight in one(1) original and three(3) copies, issued by SGS as setforth in paragraph (1) of Article 9 certifying the actual surveyed weight of Ore shipped atloading port(s).c) Certificate of quality in one(1) original and three(3) copies, issued by SGS as setforth in paragraph (1) of Article 10 showing actual result of the test of chemicalcomposition and physical composition as required in Article 6 specified in this Contract.d) Certificate of origin in one (1) original and three (3) copies issued by Chamber ofCommerce and Industry, India.e) Full set (3/3) of ―clean on board‖ shipped Ocean Bills of Lading made out ―to order‖and blank endorsed, marked ―Freight Prepaid‖, or ―freight payable as per charter party‖notifying the applicant.f) Beneficiary’s certificate certifying that they sent to Buyer by fax or mail one set ofdocuments including B/L, provisional invoice, certificate of quality, certificate of weight,and certificate of origin within five (5) working days after B/L date, and by courier servicewithin seven (7) working days after B/L date.g) Certified c opy of Beneficiary’s Shipment Advice to Buyers within 3 working days aftercompletion of loading by fax or mail of the Contract number, name of commodity, grossweight, loading and sailing date, bill of lading number and date, name of Vessel,approximate invoice value and ETA at the port of discharge.i) Full set of insurance policy/certificate, for 110pct of the invoice value showing claimspayable in Singapore/China in currency of the draft, blank endorsed in negotiable form,covering all risks and war risks.(3) Final PaymentBuyer shall make final payment for the balance between the final value of the Ore calculated onthe basis of the final analysis as set forth in Article 10(3) and the final weight as set forth inArticle 9(2) and the amount of provisional payment as set forth in the preceding Paragraph (2).Such final payment shall be made through the Letter of Credit against Seller’s sigh t draft or inexceptional cases by T/T remittance from Buyer to Seller. The said sight draft shall beaccompanied by the following documents:a)Seller’s signed f inal invoice in five originals based on Inspection Certificates issued by CIQ.b)Inspection Certificate of Quality issued by CIQ at discharging port in one photocopy.c)Inspection Certificate of Weight issued by CIQ at discharging port in one photocopy; ord)In case Certificate(s) of Quality and / or Weight issued by CIQ is not provided by the Buyerwithin 60 days after completion of discharge, then Seller has the right to negotiate the finalinvoice based on loading port’s Certificate of Quality and/or Weight issued by SGS, a copyof which shall be submitted to the Buyer as substitute documents. In such case, adeclaration issued by the Seller of non-receipt of CIQ inspection certificate shouldaccompany documents.(e) In case umpire analysis is required as per terms of this contract then report requiredunder (a), (b) and (c) above shall be from the umpire analysis instead of CIQ. In such casedeclaration by the Seller and Buyer for Umpire analysis required under this Contract shouldaccompany documents.The final invoice or final calculation sheet based on CIQ certificate must be confirmed by otherparty within 7 working days after sight. In case there is any overpayment due to Buyer afteradjustments have been made as hereinabove provided, it shall be paid by Seller to Buyer in theUnited States Currency by telegraphic transfer or by any other means to be mutually agreedupon between Buyer and Seller within 7 working days upon issuance of Buyer’s final debitstatement.Article 12 SHIPMENT:1)Shipment shall be made from port of loading in vessel arranged by Seller. The Seller shall provide orarrange for transport of all product sold and delivered under this Contract from loading port to the discharge port in a single-deck bulk carrier (―the Vessel‖).The Seller shall notify Buyer of Vessel nomination including all the vessel particulars for B uyer’s confirmation and acceptance before vessel arrival at loading port or before loading. However, in the event of delay by Seller to notify such to Buyer, the Buyer at its own discretion has the right to terminate the contract and reserve the rights to claim against Seller for all incurred costs under this contract, and other losses and expenses as provided in Article 23.2)If carrying vessel is tween-deck or multi-purpose or for any other reasons on vessel’s own fault, whichcause additional port/discharging fee charged by port authority, then such fee shall be on Seller’s account, and shall be settled within 7 working days against Buyer’s debit note.Article 13. ADVICE OF SHIPMENT:(1)Seller shall, upon completion of loading, advise Buyer within three working days by cable/telex/fax/email of the Contract number, name of commodity, gross weight, loading and sailing date, name of vessel, approximate invoice value, Bill of Lading No. & date and ETA at the port of discharge. (2)Seller guarantee to provide Buyer by fax or email with a set of shipping documents copy listed asaforesaid in article 10(2) within 5 working days after shipment date (or at least 3 working days prior to vessel arrival at discharging port)Article 14. NOTICE OF ARRIVAL:1) Seller shall advise Buyer at least 14 (Fourteen) days in advance of the estimated date of arrival of thevessel at port of discharge, specifying the type of vessel and hatch division.2) The Seller shall arrange for the Master of the Vessel to notify Buyer three notices of ETA of the Vesselat the discharging port. The first of such notice will be given 10 days prior to the ETA of the Vessel, the second to be given 48 hours prior to the ETA and the third to be given 24 hours prior to ETA.Article 15. DISCHARGING TERMS:1)Buyer guarantees discharging rate of **,000 tons PWWD SHINC.Demurrage rate: US$ **,000 per day of 24 hours or pro- rata. Half dispatch.Turn time: 12 hours unless sooner commenced.2)Notice of readiness to load shall be tendered with clean holds, hatch open and ready in allrespects to discharge the cargo at any time. The lay time shall commence to count 12 hours turn time after NOR has been accepted. If the vessel is not in free pratique on arrival at the berth due to causes attributable to the vessel, then a new notice of readiness shall be tendered after free pratique is granted.3)Any delays caused by ice, floods, quarantine, export or import prohibitions, restrictions or anyother acts of government or any other events of ―force majeure‖ as defined in Article 20 will not count as lay time or demurrage.4)Any time lost during discharging due to the Vessel’s inability to discharge at the applicabledischarge rates determined in accordance with this article or due to any other defects and /or default in the Vessel, deficiency and /or default of the Vessel’s person nel, including inability of the Vessel to ballast or de-ballast at a rate commensurate with the respective discharging rate, shall not count as lay time or demurrage. Any time lost by the Vessel in obtaining gas free clearance or free pratique, either directly or consequentially, shall be for the Seller’s account.5)If original bill(s) of lading could not be presented at discharging port, the Seller and the shipOwner must agree to discharge the entire Ore without presentation of original bill(s) of lading.Any delay of owner’s confirmation of discharging cargo without original bills of lading, the demurrage loss arising from that shall not be on Buyer’s account.6)The Buyer has right to appoint the discharge port shipping agent at O wner or Seller’s costs.Owner and/or Seller must appoint the agent informed by Buyer. If any failure, the discharging terms shall change to CQD.7)Lightening if requir ed by Buyer to Buyer’s account; Lightening if required by Master/Owner toSeller’s account and time should not be counted as lay time.8)Counting of lay time shall cease on completion of discharging. The following time shall not becounted as lay time used even if the vessel already on demurrage:a)Shifting time from anchorage to berth and/or between berths, while all the expense arisingout of the shifting shall be on Seller’s account.b)Time lost due to ballasting /de-ballasting of the vesselc)Time proceeding from customary waiting place/anchorage to discharging berthd)Time used for first opening and last enclosing of hatches.e)Any time lost due to failure or brea kdown of ship’s gear or equipment which may effect ordelay continued normal discharge operations.f)Time used for the draft survey(s) to determine Cargo quantity.9)The vessel shall vacate discharging place as soon as discharging is completed, weather and tidepermitting.Article 16. TRANSFER OF TITLE AND RISK:1)Seller warrants that at the time of delivery, the cargo under the contract have good title to theproduct and will deliver to Buyer free and clear of all liens, claims and encumbrances.If in case of Buyer innocently involved into third party dispute between vessel owner and charter due to some outstanding payment, e.g. vessel owner refuse to give cargo-delivery order even if Buyer’s presentation of original bills of lading for releasing cargo at discharging port, Seller shall deposit to court as required by court for Buyer’s arrangement of cargo release through marine court in lawful way.2)Title with respect to each shipment shall pass from Seller to Buyer when the Buyer has made theprovisional payment through the opening bank against the relative shipping documents as set forth in Article 11(2).3)All risk of loss, damage or destruction respecting the Ore delivered shall pass to the Buyer from thetime of loading of the Ore thereof and the ore pass the vessel rail .In the event that the Ore is lost, damaged or diminished after risk passes but before title of Ore vests in the Buyer,The Seller agrees to assign absolutely and/or subrogate all their rights, title to sue and interest to the Buyer to recover against any third party for losses and/or damages caused and/or expense incurred arising out of and/or in connection with and/or in relation to the Ore.Seller undertakes and warrants that their rights against third parties as aforesaid are and will not be impaired in any way by any act done or to be done by Seller.Seller agrees at all time t o let Buyer and/or Buyer’s servants or agents to have access to all information, documents, and evidence in relation thereto. Seller warrants that Seller has preserved and undertakes to preserve all original documents and evidence in connection with and in relation to the Ore.Seller also undertakes and agrees to allow any proceedings to be taken in Seller’s name without any reference to Seller in exercise of Buyer’s said rights and interest arising out of or in connection with this agreement, and if required, to assist in such proceedings in any form that may be required of Seller, including the provision of all witness and documents.Article 17. LOSS OF CARGO:1) In the event of partial loss of Ore, the final cargo value of the shipment ore shall be basis the weightof Ore shall be the B/L quantity determined as per Article 9(1), and the quality/analysis determined as per Article 10(3).2) In the event of total loss of Ore, the analysis and the weight as determined at the loading port(s) shallbe treated as final and shall be used for final invoicing and payment.Article 18. INSURANCE1) Insurance shall be effected and arranged by Buyer for the full Ore value of the shipment, from the timeof loading of the Ore thereof. For this purpose Seller shall advise Buyer by fax or mail the vessel movement/detais before the loading starts and immediately after completion of the loading as specified in Article 13 of this Contract.2) The Vessel arranged by Seller shall not be over 25 years old. However, if vessel age is above 20 years,the full costs of the OAP will be borne by Seller, and such OAP should be settled within 7 working days against Buyer’s debit note.Article 19. Tax, Duties and other Export & Import FeesAll tax, duties and other export fees levied on export of Iron Ore in the country of Origin shall be for account of Seller, whereas all tax, duties and other import fees levied on the import of Iron Ore in the country of destination shall be for Buyer’s account.Article 20. FORCE MAJEURE1) Neither party shall be held responsible for failure or delay to perform all or in part any obligation underthis Contract if the failure or delay results from event of force majeure.For the purpose of this Contract, force majeure shall mean the following: acts of God, flood, fire, explosion, earthquake, fog, hurricane, snowstorm, tsunami, and drough, war, invasion, outbreak of hostilities, act of terrorism; Government sanction2) The date of fulfillment of any obligation shall be postponed during the time when such circumstancesare operative.3) Any waiver/ extension of time in respect of the delivery of any part of the Ore shall not be deemed to bewaiver/extension of time in respect of the remaining part.4) Any Party asserting Force Majeure shall give notice to the other party of a force majeure event within24 hours of its occurrence. The Party shall have the burden of proving that reasonable steps weretaken (under the circumstances) to minimize delay or damages caused by foreseeable events, that all non-excused obligations were substantially fulfilled. Certificate issued by a Chamber of Commerce in the country of the Seller or Buyer shall be sufficient proof of the existence of the above circumstances and their duration, and the Party whose performance is affected by force majeure shall send the Certificate of the occurrence of the force majeure event issued by Chamber of Commerce not later than 3 days after its occurrence.5) If the event of Force Majeure continues for more than 30 days, either party will have the right to refusefurther performance of the Contract in which case neither party shall have the right to claim eventual damages.6) In the event the Force Majeure caused only partial reduction in the total quantity of Ore the Seller is。
