Time Charter Firm Offer Example

The following are the main terms of a firm offer at a time charter:

• Reply by: (place and time limit)
• For account of: (name and background of charterers)
• The ship’s name and particulars: (description)
• Name of shipowner: (full style)
• Delivery: (when/where ready, arrival pilot station – aps or passing “x”)
• Laydays/ laycan:
• Duration:
• Trading area: (e.g., worldwide, Atlantic Basin)
• Intended trade:
• Cargo and trading exclusions:
• Hire rate: (daily, per metric ton – pmt, lump sum; when, where, and how paid)
• Redelivery: (when/where ready, dropping outwards pilot – dop or passing “x”)
• Commissions: (address/brokerage)
• Charter party form to be used
• Subjects: (detail/stem/shippers’ -receivers’ approval/owner’s- charterer’s board of directors’ approval)

Consider the following example.
Owners would like to offer firm for reply today, February 28,2012, 10:00 hrs Greece time as follows:

• M/V Bulk Carrier I (built, type, class, flag, etc.)
• Account: CUT Ltd.
• Owners: Bulk Owners Ltd.
• Dely: afsps Rotterdam atdnshinc
• Laycan: March 15-20,2014,00:01-23:59 hrs LT
• Period: 1 year T/C, always within thirty days mol inchopt
• Trading: Worldwide trading and always within iwl, via gsp(s), gsb(s), gsa(s), aaaa.
• Trading and cargo exclusions to be discussed and mutually agreed with c/p details
• Intended trade: Med.-UKC ports wog
• Hire rate: $8,000 – pdpr
• Commissions: 2.5 percent address com. + 1.25 percent ABC Brokers
• Redelivery: dlosp 1 sp ARA range
• All other terms and conditions to be discussed and mutually agreed as per CUT pro forma/executed c/p dd 12.20.2011
• Subjects (detail/stern/shippers-receivers’ approval/owner’s- charterer’s board of directors’ approval)

This example of a firm offer for a time charter concerns the motor vessel Bulk Carrier I for delivery upon arrival at the first sea pilot station (afsps) in Rotterdam any time of day and night, Sundays and holidays included (atdnshinc). The arrival is estimated March 15-
20, 2014. The charter period is one year, always within thirty days more or less in charterers’ option. The ship may trade worldwide within Institute Warranty Limits (IWL), via good safe ports (gsp), good safe berths (gsb), and good safe anchorages (gsa), always accessible and always afloat. Potential trading exclusions and cargo exclusions must be mutually discussed between the parties and agreed in the charter party. The intended trading of the ship is in the Mediterranean and United Kingdom Continent ports with- out guarantee (WOG), and the hire rate is $8,000 per day pro rata (pdpr). Commissions payable by the shipowner are 2.5 percent address commission and 1.25 percent brokerage to ABC Brokers. Redelivery of the ship to take place upon dropping the last outward sea pilot (dlosp) in a safe port in the Antwerp-Rotterdam- Amsterdam (ARA) range. All other terms and conditions to be discussed and mutually agreed as per the pro forma charter party. The firm offer is subject to details, including subject to enough merchandise (stem), shippers’ and receivers’ approval, and the approval of the board of directors of the charterer.