---

34.  Grace period (state number of clear banking days) (Cl. 28) N/A	35.  Dispute Resolution (state 30(a), 30(b) or 30(c); if 30(c) agreed Place of Arbitration must be stated (Cl. 30) (c) Clause 30 not applicable. See Clause 65
36.  War cancellation (indicate countries agreed) (Cl. 26(f)) N/A
37.  Newbuilding Vessel (indicate with “yes” or “no” whether PART III applies) (optional) No	38.  Name and place of Builders (only to be filled in if PART III applies) N/A
39.  Vessel’s Yard Building No. (only to be filled in if PART III applies) N/A	40.  Date of Building Contract (only to be filled in if PART III applies) N/A
41.  Liquidated damages and costs shall accrue to (state party acc. to Cl. 1) a) N/A b) N/A c) N/A
42.  Hire/Purchase agreement (indicate with “yes” or “no” whether PART IV applies) (optional) No, Part IV does not apply	43.  Bareboat Charter Registry (indicate with “yes” or “no” whether PART V applies) (optional) No
44.  Flag and Country of the Bareboat Charter Registry (only to be filled in if PART V applies) N/A	45.  Country of the Underlying Registry (only to be filled in if PART V applies) N/A
46.  Number of additional clauses covering special provisions, if agreed Clause 32 to Clause 66

 

 

 

 

 

with effect from the date hereof until the end of the Charter Period (subject to the terms of this Charter).

 

 

 

 

 

then this Charter shall immediately terminate and be cancelled (without prejudice to Clause 57 (Indemnities) and without the need for either the Owners or the Charterers to take any action whatsoever), provided that the Owners shall be entitled to retain all fees and expenses paid by the Charterers pursuant to Clause 44 (Fees and Expenses) (and without prejudice to Clause 44 (Fees and Expenses) and any clause of the MOA, if such fees have not been paid, the Charterers shall forthwith pay such fees and expenses to the Owners in accordance with Clause 44 (Fees and Expenses)), save that if the Charter is terminated and/or the Vessel not delivered under the MOA for a reason solely related to a default of the Owners, then the Charterers shall not be obliged to pay the Arrangement Fee (and if the Arrangement Fee has already been paid at such time, the Owners shall refund the Arrangement Fee to the Charterers within a reasonable time). Any such payment by the Charterers under this Clause shall be irrevocable and unconditional and is acknowledged by the Charterers to be proportionate as to amount, having regard to the legitimate interest of the Owners, in protecting against the Owners’ risk of the Charterers failing to perform its obligations under this Charter. For the avoidance of doubt, the termination of the Charter shall not prejudice the operation of any provision of any Leasing Document which is expressed to survive the termination or cancellation of this Charter.

 

 

 

being true and correct on the date hereof and on the Commencement Date;

 

 

 

 

 

and if any of the documents listed in sub-paragraph (d) above are not in the English language then they shall be accompanied by an English translation where required by the Owners.

 

 

 

 

 

 

 

 

 

36.3	The Advance Charterhire shall not bear interest and shall be non-refundable.

 

 

 

 

to the Owners’ Costs on the immediately preceding Payment Date (or, in the case of the First Payment Date only, on the Commencement Date) for the Hire Period ending on the relevant Payment Date by reference to the actual number of days elapsed in that Hire Period.

 

 

such that there are a total of twenty (20) Payment Dates during the Charter Period.

 

 

 

 

 

 

 

 

 

 

 

 

(g)	any insolvency, bankruptcy, reorganization, arrangement, readjustment, dissolution, liquidation or similar proceedings by or against the Charterers and any other Obligors;

(h)	any invalidity, unenforceability, lack of due authorization or other defects, or any failure or delay in performing or complying with any of the terms and provisions of this Charter or any of the Leasing Documents by any party to this Charter or any other person;

(i)	any enforcement or attempted enforcement by the Owners of their rights under this Charter or any of the Leasing Documents executed or to be executed pursuant to this Charter;

(j)

any loss of use of the Vessel due to deficiency or default or strike of officers or crew, fire, breakdown, damage, accident, defective cargo or any other cause which would or might but for this provision have the effect of terminating or in any way affecting any obligation of the Charterers under this Charter; or

(k)	any prevention, delay, deviation or disruption in the use of the Vessel resulting from the wide outbreak of any viruses (including the 2019 novel coronavirus), including but not limited to those caused by:

(i)

closure of ports;

(ii)

prohibitions or restrictions against the Vessel calling at or passing through certain ports;

(iii)

restriction in the movement of personnel and/or shortage of labour affecting the operation of the Vessel or the operation of the ports (including stevedoring operations);

(iv)

quarantine regulations affecting the Vessel, its cargo, the crew members or relevant port personnel;

(v)

fumigation or cleaning of the Vessel; or

(vi)

any claims raised by any sub-charterer or manager of the Vessel that a force majeure event or termination event (or any other analogous event howsoever called) has occurred under the relevant charter agreement or management agreement (as the case may be) of the Vessel as a result of the outbreak of such viruses.

36.12

All stamp duty, value added tax (for the avoidance of doubt, including without limitation, goods and services tax), withholding or other taxes and import and export duties and all other similar types of charges which may be levied or assessed on or in connection with:

(a)	the operation of this Charter in respect of the hire and all other payments to be made pursuant to this Charter and the remittance thereof to the Owners; and

(b)	the import, export, purchase, delivery and re-delivery of the Vessel,

–	CHANGES TO INTEREST RATE, DEFAULT INTEREST

37.1	If, in relation to any determination of the Interest Rate prior to a Screen Rate Replacement Event:

(a)

the Owners determine (which determination shall be conclusive and binding) that by reason of circumstances affecting the Relevant Interbank Market generally, adequate and fair means do not or will not exist for ascertaining LIBOR at the beginning of that Hire Period or the same does not reflect the cost of funding of the Owners; and

(b)

the Owners determine (which determination shall be conclusive and binding) that by reason of circumstances affecting the Relevant Interbank Market generally, deposits in Dollars in the required amount for the 3-month period commencing on the first day of that Hire Period are not available to it in the Relevant Interbank market or from whatever sources it may select to obtain funds for that Hire Period,

37.2	Immediately following the notification referred to in Clause 37.1 above, the Owners and the Charterers, shall negotiate in good faith with a view to agreeing upon a substitute basis for determining the Interest Rate for that Hire Period.

37.3

If a substitute basis is not so agreed pursuant to Clause 37.2 above or after the occurrence of a Screen Rate Replacement Event but prior to the making of any necessary amendment or waiver in accordance with Clause 37.4 below, the Interest Rate shall be the rate per annum equal to the cost certified by the Owners (expressed as an annual rate of interest) of funding the Owners’ Costs during the relevant Hire Period (as reasonably determined by the Owners).

37.4	On or at any time after the occurrence of a Screen Rate Replacement Event, the Owners are entitled to make any amendment or waiver to the terms of the Leasing Documents (at the Charterers’ cost) which relates to:

(a)	providing for the use of a Replacement Benchmark in relation to Dollars in place of (or in addition to) that Screen Rate; and

(i)

aligning any provision of any Leasing Document to the use of that Replacement Benchmark;

(ii)

enabling that Replacement Benchmark to be used for the calculation of the Interest Rate under this Charter (including, without limitation, any consequential changes required to enable that Replacement Benchmark to be used for the purposes of this Charter);

(iii)

implementing market conventions applicable to that Replacement Benchmark;

(iv)

providing for appropriate fallback (and market disruption) provisions for that Replacement Benchmark; or

(v)

adjusting the pricing to reduce or eliminate, to the extent reasonably practicable, any transfer of economic value from one Party to another as a result of the application of that Replacement Benchmark (and if any adjustment or method for calculating any adjustment has been formally designated, nominated or recommended by the Relevant Nominating Body, the adjustment shall be determined on the basis of that designation, nomination or recommendation),

37.5

If the Charterers fail to make any payment due under this Charter on the due date, they shall pay additional interest on such late payment at a rate which is equal to two per cent. (2%) per annum above the aggregate of (i) the applicable Interest Rate for the relevant Hire Period and (ii) the Margin which shall apply prior to, during or following Delivery and shall accrue on a daily basis from the date on which such payment became due up to and excluding the date of payment thereof, and the Charterers and the Owners agree that such default rate is proportionate as to amount, having regard to the legitimate interest of the Owners, in protecting against the Owners’ risk of the Charterers failing to perform its obligations under this Charter.

37.6	All interest (including default interest) and any other payments under this Charter which are of an annual or periodic nature shall accrue from day to day and shall be calculated on the basis of the actual number of days elapsed and a three hundred and sixty (360) days’ year.

38.1

The Charterers shall not, without the prior written consent of the Owners, assign, mortgage or pledge the Vessel or any interest therein and shall not permit the creation or existence of any Security Interest thereon (including for any monies paid in advance and not earned, and for any claims for damages arising from any breach by the Owners of this Charter and other amounts due to the Charterers under this Charter) except for the Permitted Security Interests.

38.2	The Charterers shall promptly notify any party (including without limitation, any sub-charterer) (as the Owners may request) in writing that the Vessel is the property of the Owners and the Charterers shall provide the Owners with a copy of such written notification.

38.3

If the Vessel is arrested, seized, impounded, forfeited, detained or taken out of their possession or control (whether or not pursuant to any distress, execution or other legal process), the Charterers shall procure the immediate release of the Vessel (whether by providing bail or procuring the provision of security or otherwise do such lawful things as the circumstances may require) and shall immediately notify the Owners of such event and shall indemnify the Owners against all documented losses, costs or charges incurred by the Owners by reason thereof in re- taking possession or otherwise in re-acquiring the Vessel.

38.4

The Charterers shall pay and discharge or cause any sub-charterer of the Vessel to pay and discharge all obligations and liabilities whatsoever which have given or may give rise to liens on or claims enforceable against the Vessel. The Charterers shall take all reasonable steps to prevent (and shall procure that a sub-charterer shall take all steps to prevent) an arrest of the Vessel.

–

INSURANCE

39.1	The Charterers shall procure that insurances for the Vessel are effected:

(a)	in Dollars;

(b)

in the case of fire and usual hull and machinery, marine risks and war risks (including blocking and trapping), on an agreed value basis of at least the higher of (i) one hundred per cent (100%) of then applicable Fair Market Value of the Vessel and (ii) one hundred and twenty per cent (120%) of the then prevailing Owners’ Costs;

(c)	in the case of oil pollution liability risks, for an aggregate amount equal to the higher of (i) US$1,000,000,000 or (ii) the highest level of cover from time to time available under basic protection and indemnity club entry and in the international marine insurance market;

(d)	in the case of protection and indemnity risks, in respect of the full tonnage of the Vessel and with a protection and indemnity club which is a member of the International Group of Protection and Indemnity Clubs;

(e)

through brokers approved by the Owners and with first class international insurers and/or underwriters acceptable to the Owners and having a Standard & Poor’s rating of BBB+ or above, a Moody’s rating of A or above or an AM Best rating of A- or above or, in the case of war risks, through a protection and indemnity club which meets the requirements of paragraph (d) above; and

(f)	otherwise on terms and in form acceptable to the Owners.

39.2	In addition to the terms set out in Clause 13(a) (Insurance and Repairs), the Charterers shall procure that the Obligatory Insurances shall:

(a)	subject always to paragraph (b), name the Owners and the Charterers as the only named assureds unless the interest of every other named assured or co-assured is limited:

(i)

in respect of any Obligatory Insurances for hull and machinery and war risks;

(A)

to any provable out-of-pocket expenses that they have incurred and which form part of any recoverable claim on underwriters; and

(B)

to any third party liability claims where cover for such claims is provided by the policy (and then only in respect of discharge of any claims made against them); and

(ii)

in respect of any Obligatory Insurances for protection and indemnity risks, to any recoveries they are entitled to make by way of reimbursement following discharge of any third party liability claims made specifically against them,

(b)	whenever the Owners require in respect of any Owners’ Financiers:

(i)

in respect of fire and other usual marine risks and war risks, name (or be amended to name) the same as additional named assured for their rights and interests, warranted no operational interest and with full waiver of rights of subrogation against such Owners’ Financier, but without such financiers thereby being liable to pay (but having the right to pay) premiums, calls or other assessments in respect of such insurance;

(ii)

in relation to protection and indemnity risks, name (or be amended to name) the same as additional insured or co-assured for their rights and interests to the extent permissible under the relevant protection and indemnity club rules; and

(iii)

name the Owners’ Financiers (if any) and the Owners as respectively the first ranking loss payee and the second ranking loss payee (and in the absence of any Owners’ Financiers, the Owners as first ranking loss payee) in accordance with the terms of the relevant loss payable clauses approved by the Owners’ Financiers and the Owners with such directions for payment in accordance with the terms of such relevant loss payable clause, as the Owners and the Owners’ Financiers (if any) may specify;

(c)	provide that all payments by or on behalf of the insurers under the Obligatory Insurances to the Owners and/or the Owners’ Financiers (as applicable) shall be made without set-off, counterclaim, deduction or condition whatsoever;

(d)	provide that such Obligatory Insurances shall be primary without right of contribution from other insurances which may be carried by the Owners or the Owners’ Financiers (if any);

(e)	provide that the Owners and/or the Owners’ Financiers (if any) may make proof of loss if the Charterers fail to do so; and

(f)

provide that if any Obligatory Insurance is cancelled, or if any substantial change is made in the coverage which adversely affects the interest of the Owners and/or the Owners’ Financiers (if any), or if any Obligatory Insurance is allowed to lapse for non-payment of premium, such cancellation, change or lapse shall not be effective with respect to the Owners and/or the Owners’ Financiers (if any) for thirty (30) days after receipt by the Owners and/or the Owners’ Financiers (if any) of prior written notice from the insurers of such cancellation, change or lapse.

39.3	The Charterers shall:

(a)	at least ten (10) days prior to Delivery (or such shorter period agreed by the parties), notify in writing the Owners of the terms and conditions of all Insurances;

(b)

at least seven (7) days before the expiry of any Obligatory Insurance or otherwise before the change of appointment of any brokers (or other insurers) and any protection and indemnity or war risks association through which Obligatory Insurances are taken from time to time pursuant to this Clause 39 (Insurance), notify the Owners of the brokers (or other insurers) and any protection and indemnity or war risks association through or with whom the Charterers propose to renew or obtain that Obligatory Insurance and of the proposed terms of such renewed or new insurance cover and obtain the Owners’ approval to such matters;

(c)	at least two (2) days before the expiry of any Obligatory Insurance, procure that such Obligatory Insurance is renewed or to be renewed on its expiry date in accordance with the provisions of this Charter;

(d)

procure that the approved brokers and/or the war risks and protection and indemnity associations with which such a renewal is effected shall promptly after the renewal or the effective date of the new insurance and protection and indemnity cover notify the Owners in writing of the terms and conditions of the renewal; and

(e)

as soon as practicable after the expiry of any Obligatory Insurance and within thirty (30) days after such expiry, deliver to the Owners a letter of undertaking as required by this Charter in respect of such Insurances for the Vessel as renewed pursuant to Clause 39.3 together with copies of the relevant policies or cover notes or entry certificates duly endorsed with the interest of the Owners and/or the Owners’ Financiers (if any).

39.4

The Charterers shall ensure that all insurance companies and/or underwriters, and/or insurance brokers (if any) provide the Owners with copies (or upon the Owners’ request, originals) of policies, cover notes and certificates of entry relating to the Obligatory Insurances which they are to effect or renew and letter or letters of undertaking in a form required by the Owners or the Owners’ Financiers (if any) and including undertakings by the insurance companies and/or underwriters that:

(a)	they will have endorsed on each policy, immediately upon issuance, a loss payable clause and a notice of assignment complying with the provisions of this Charter and the Financial Instruments;

(b)	they will hold the benefit of such policies and such insurances, to the order of the Owners and/or the Owners’ Financiers (if any) and/or such other party in accordance with the said loss payable clause;

(c)	they will advise the Owners and the Owners’ Financiers (if any) promptly of any material change to the terms of the Obligatory Insurances of which they are aware;

(d)

they will notify the Owners and the Owners’ Financiers (if any) not less than fourteen (14) days before the expiry of the Obligatory Insurances, in the event of their not having received notice of renewal instructions from the Charterers and, in the event of their receiving instructions to renew, they will promptly notify the Owners and the Owners’ Financiers (if any) of the terms of the instructions; and

(e)

if any of the Obligatory Insurances form part of any fleet cover, the Charterers shall procure that the insurance broker(s), or leading insurer, as the case may be, undertakes to the Owners and the Owners’ Financiers (if any) that such insurance broker or insurer will not set off against any sum recoverable in respect of a claim relating to the Vessel under such Obligatory Insurances any premiums due in respect of any other vessel under any fleet cover of which the Vessel forms a part or any premium due for other insurances, they waive any lien on the policies, or any sums received under them, which they might have in respect of such premiums, and they will not cancel such Obligatory Insurances by reason of non-payment of such premiums or other amounts, and will arrange for a separate policy to be issued in respect of the Vessel forthwith upon being so requested by the Owners or the Owners’ Financiers (if any) and where practicable.

39.5	The Charterers shall ensure that any protection and indemnity and/or war risks associations in which the Vessel is entered provides the Owners and the Owners’ Financiers (if any) with:

(a)	a copy of the certificate of entry for the Vessel as soon as such certificate of entry is issued; and

(b)	a copy of the letter or letters of undertaking in such form as may be required by the Owners or the Owners’ Financiers (if any) or in such association’s standard form.

39.6	The Charterers shall ensure that all policies relating to the Obligatory Insurances are deposited with the approved brokers (if any) through which the insurances are effected or renewed.

39.7	The Charterers shall procure that all premiums or other sums payable in respect of the Obligatory Insurances are punctually paid.

39.8	The Charterers shall ensure that any guarantees required by a protection and indemnity or war risks association are promptly issued and remain in full force and effect.

39.9

The Charterers shall neither do nor omit to do (nor permit to be done or not to be done) any act or thing which would or might render any Obligatory Insurance invalid, void, voidable or unenforceable or render any sum payable under an Obligatory Insurance repayable in whole or in part and, in particular:

(a)

the Charterers shall procure that all necessary action is taken and all requirements are complied with which may from time to time be applicable to the Obligatory Insurances, and (without limiting the obligations contained in this Clause) ensure that the Obligatory Insurances are not made subject to any exclusions or qualifications to which the Owners have not given their prior approval (unless such exclusions or qualifications are made in accordance with the rules of a protection and indemnity association which is a member of the International Group of Protection and Indemnity Clubs);

(b)

the Charterers shall not make or permit any changes relating to the classification or the classification society of the Vessel or, subject to procuring the provision of a replacement manager’s undertaking in substantially the same form as the Manager’s Undertaking, any changes to the manager or operator of the Vessel unless such changes have, if required, first been approved by the underwriters of the Obligatory Insurances and the Owners or the Owners’ Financiers (if any);

(c)

the Charterers shall procure that all quarterly or other voyage declarations which may be required by the protection and indemnity risks association in which the Vessel is entered to maintain cover for trading to the United States of America and Exclusive Economic Zone (as defined in the United States Oil Pollution Act 1990 or any other applicable legislation) are made and the Charterers shall promptly provide the Owners with copies of such declarations and a copy of its valid certificate of financial responsibility; and

(d)

the Charterers shall not employ the Vessel, nor allow it to be employed, otherwise than in conformity with the terms and conditions of the Obligatory Insurances, without first obtaining the consent of the insurers and complying with any requirements (as to extra premium or otherwise) which the insurers specify.

(a)	the approved brokers;

(b)	the approved protection and indemnity and/or war risks associations; and

(c)	the approved insurers and/or underwriters, which relate directly or indirectly to:

(i)

prior to the occurrence of a continuing Termination Event, a Major Casualty or a Total Loss; and

(ii)

at any time after the occurrence of a Termination Event and while it is continuing, any material communications whatsoever relating to the insurances of the Vessel.

(a)	obtaining or preparing any report from an independent marine insurance broker as to the adequacy of the Insurances (including but not limited to the report obtained under Clause 39.16); or

(b)	effecting, maintaining or renewing any such insurances as are referred to in Clause 13(a) (Insurance and Repairs) or this Clause 39 or dealing with or considering any matters relating to any such insurances;

(a)	the Owners in connection with or with a view to effecting, maintaining or renewing an innocent owners interest insurance and an innocent owners additional perils insurance or any similar protective shipowner insurance that is taken out in respect of the Vessel; and/or

(b)	the Owners’ Financiers (if any) in connection with or with a view to effecting, maintaining or renewing a mortgagee’s interest insurance, a mortgagee’s additional perils insurance, all protection and indemnity insurance that is taken out in respect of the Vessel,

43.3	If the Total Loss Proceeds unconditionally received by the Owners or the Owners’ Financiers in accordance with the terms of the relevant loss payable clause) are less than the Termination Sum, the Charterers shall pay such shortfall to the Owner on the Total Loss Payment Date.

43.4	The Owners shall have no obligation to supply to the Charterers with a replacement vessel following the occurrence of a Total Loss.

–	FEES AND EXPENSES

44.2

All costs and expenses including, but not limited to legal costs, expenses and other disbursements incurred by the Owners and each of their legal counsels in relation to preparing, negotiating and executing this Charter and the Leasing Documents and/or any Financial Instruments, shall be for the account of the Charterers (regardless of whether the transaction contemplated by the Leasing Documents actually completes).

(a)	the Charterers request an amendment, waiver or consent;

(b)	the Charterers make a request to re-register the Vessel in another Flag State; or

(c)	an amendment is required to address the fact that the Screen Rate is not or is likely not to be available for Dollars,

44.5

All reasonable and documented costs and expenses (including legal fees) incurred by the Owners in relation to the transfer of title of the Vessel by the Owners to the Charterers and the re-delivery of the Vessel by the Charterers to the Owners pursuant to Clause 41 (Termination and Redelivery) shall be for the account of the Charterers.

44.6

The Charterers shall, on demand, pay to the Owners the amount of all costs and expenses (including legal fees) incurred by the Owners in connection with the enforcement of, or the preservation of any rights under, any Leasing Document, including, without limitation, any action brought by the Owners to arrest or recover possession of the Vessel, and with any proceedings instituted by or against the Owners as a consequence of it entering into a Leasing Document or enforcing those rights.

-	NO WAIVER OF RIGHTS

45.1

No neglect, delay, act, omission or indulgence on the part of either Party in enforcing the terms and conditions of this Charter or any other Leasing Document (to which they are party to) shall prejudice the strict rights of that Party or be construed as a waiver thereof nor shall any single or partial exercise of any right of either party preclude any other or further exercise thereof.

45.2	No right or remedy conferred upon either Party by this Charter or any other Leasing Document shall be exclusive of any other right or remedy provided for herein or by law and all such rights and remedies shall be cumulative.

-

NOTICES

–	TERMINATION EVENTS

(a)	the Charterers or the Guarantor fails to pay or the Owners do not receive on the due date any amount payable pursuant to a Leasing Document, unless such failure to pay is caused by a technical error and payment is made within three (3) Business Days of its due date;

(b)	the Charterers breach or omit to observe or perform or procure the performance of any of the undertakings in Clauses 34.7, 50.1(f), Clause 51, Clause 52, 53.1(b), 53.1(c), 53.1(d), 53.1(g) or 53.1(h);

(c)	the Charterers fail to obtain and/or maintain the Insurances required under Clause 39 (Insurance) in accordance with the provisions thereof (or any insurer in respect of such Insurances cancels the Insurances or disclaims liability with respect thereto);

(d)

any Obligor commits any other breach of, or omits to observe or perform, any of their other obligations or undertakings in any Leasing Document (other than a breach referred to in paragraphs (a) to (c) above) or any Approved Manager that is not a member of the Group breaches any provision of, or omits to observe or perform, any of their obligations or undertakings in any Manager’s Undertaking unless such breach or omission is in the reasonable opinion of the Owners, remediable and the relevant Obligor or Approved Manager remedies such breach or omission to the satisfaction of the Owners (acting reasonably) within ten (10) Business Days of the earlier of (i) the date of the notice thereof from the Owners or (ii) upon the relevant Obligor or Approved Manager becoming aware of the same;

(e)	any representation or warranty made by or on behalf of an Obligor, in or pursuant to any Leasing Document to which it is a party, proves to be, in the opinion of the Owners, untrue or misleading when it is made;

(f)	any of the following occurs in relation to any Financial Indebtedness of any Obligor:

(i)

any Financial Indebtedness is not paid when due or not paid within any applicable grace period;

(ii)

any Financial Indebtedness is declared to be or otherwise becomes due and payable prior to its specified maturity as a result of an event of default (however described) and following the expiry of any applicable grace period;

(iii)

any commitment for any Financial Indebtedness is cancelled or suspended by any of its creditors as a result of an event of default (however described) and following the expiry of any applicable grace period;

(iv)

any of its creditors becomes entitled to declare any Financial Indebtedness due and payable prior to its specified maturity as a result of an event of default (however described) and following the expiry of any applicable grace period; or

(v)

any overdraft, loan, note issuance, acceptance credit, letter of credit, guarantee, foreign exchange or other facility, or any swap or other derivative contract or transaction, relating to any Financial Indebtedness of such Obligors or member of the Group ceases to be available or becomes capable of being terminated or declared due and payable or cash cover is required or becomes capable of being required, as a result of any termination event or event of default (howsoever defined) and following the expiry of any applicable grace period,

(g)	any of the following occurs in relation to any Obligor:

(i)

it becomes unable to pay its debts as they fall due;

(ii)

any administrative or other receiver is appointed over all or a substantial part of its assets unless as part of a solvent reorganisation which has been approved in writing by the Owners;

(iii)

it makes any formal declaration of bankruptcy or any formal statement to the effect that it is insolvent or likely to become insolvent or a winding up or administration order is made in relation to it, or its members or directors of pass a resolution to the effect that it should be wound up, placed in administration or cease to carry on business or it makes any formal statement to the effect that it is reasonably likely to become insolvent;

(iv)

a petition is filed in any Relevant Jurisdiction for its winding up or administration, or the appointment of a provisional liquidator over it;

(v)

it petitions a court, or presents any proposal for, any form of judicial or non-judicial suspension or deferral of payments, reorganisation of its debt (or certain of its debt) or arrangement with all or a substantial proportion (by number or value) of their creditors or of any class of them or any such suspension or deferral of payments, reorganisation or arrangement is effected by court order, contract or otherwise;

(vi)

any meeting of its members or directors is summoned to authorise or take any action of a type described in paragraphs (ii), (iii), (iv) or (v) above;

(vii)

in a country other than England and Wales, any event occurs or any procedure is commenced which, in the opinion of the Owners, is similar to any of the foregoing described in paragraphs (ii), (iii), (iv) or (v) above;

(viii)

any expropriation, attachment, sequestration, distress or execution (or any analogous process in any jurisdiction) affects any of its asset or assets (other than a Total Loss of the Vessel) provided that no Termination Event will occur under this sub-paragraph (viii) in respect of the Guarantor unless the relevant event would have or is reasonably likely to have a Material Adverse Effect;

(ix)

it fails to comply with or pay any sum due from it under any final judgment or any final order made or given by a court or tribunal of competent jurisdiction; or

(x)

if it suspends or ceases to carry on all or a material part of its business;

(h)

any consent, approval, authorisation, license or permit necessary to enable the Charterers to operate or charter the Vessel or to enable any Obligor or any Approved Manager to (i) comply with any provision of a Leasing Document to which it is a party or (ii) ensure that the obligations of that Obligor or Approved Manager under such Leasing Document are legal, valid, binding or enforceable, is not granted, expires without being renewed, is revoked or becomes, at the relevant time, expressly liable to or otherwise subject to automatic revocation or any condition of such a consent, approval, authorisation, license or permit is not fulfilled or waived within any applicable grace period (resulting in such consent, approval, authorisation, licence or permit being, at the relevant time, subject to automatic revocation or expiration);

(i)	any event or circumstance occurs which has or is reasonably likely to have a Material Adverse Effect;

(j)	an Obligor suspends or ceases carrying on its business;

(k)	the Security Interest constituted by any Security Document is in any way imperilled or in jeopardy or this Charter or any Leasing Document or any Security Interest created by a Security Document:

(i)

is cancelled, terminated, rescinded or suspended or otherwise ceases to remain in full force and effect for any reason or no longer constitutes valid, binding and enforceable obligations of any party to that document for any reason whatsoever; or

(ii)

is amended or varied without the prior written consent of the Owners, except for any amendment or variation which is expressly permitted by this Charter or any other relevant Leasing Document;

(l)	any Obligor or any Approved Manager rescinds, repudiates (or purports to rescind or repudiates or purports to repudiate) a Leasing Document;

(m)	it is or has become:

(i)

unlawful or prohibited, whether as a result of the introduction of a new law, an amendment to an existing law or a change in the manner in which an existing law is or will be interpreted or applied; or

(ii)

contrary to, or inconsistent with, any regulation,

(n)	if it becomes unlawful in any applicable jurisdiction for the Owners to perform any of their obligations as contemplated by this Charter or any other Leasing Document to which they are a party;

(o)	any Termination Event (as defined in the Other Charter) occurs under the Other Charter;

(p)	if as a result of any Sanctions, the Owners or the Owners’ Financiers are prohibited from performing any of their obligations under the Leasing Documents, the Financial Instruments or the transactions contemplated under each of these respective documents;

(q)	if any Obligor:

(i)

is or becomes a Prohibited Person;

(ii)

is owned or controlled by or acting directly or indirectly on behalf of or for the benefit of, a Prohibited Person;

(iii)

owns or controls a Prohibited Person;

(iv)

has a Prohibited Person serving as a director, officer or employee;

(r)	any lease, hire purchase agreement, charter or any other financing arrangement in respect of any Fleet Vessel is terminated, cancelled or repudiated by the relevant lessor or owner or financier as a consequence of any termination event or event of default (howsoever defined therein); or

(s)	a Change of Control in respect of the Charterers occurs without the prior written consent of the Owners.

–	REPRESENTATIONS AND WARRANTIES

(a)	each of the Obligors and any Approved Manager which is a member of the Group is duly incorporated and validly existing under the laws of its jurisdiction of incorporation;

(b)	each Obligor and any Approved Manager which is a member of the Group has the corporate capacity and has taken all corporate actions to obtain and maintain all consents, approvals, authorisations, licenses or permits necessary or desirable for it:

(i)

to enable it lawfully to enter into, exercise its rights and comply with and perform its obligations under each of the Leasing Documents to which it is a party; and

(ii)

to make each of the Leasing Documents to which it is a party admissible in evidence in its Relevant Jurisdictions;

(c)	all consents, approvals, authorisations, licences or permits referred to in Clause 48(b) remain in full force and effect and nothing has occurred which makes any of them liable to revocation;

(d)

each Leasing Document to which an Obligor and any Approved Manager which is a member of the Group, is a party constitutes such Obligor’s and Approved Manager’s legal, valid and binding obligations enforceable against such party (and where expressed to be a deed, shall be enforceable as a deed) in accordance with its respective terms;

(e)	the entry into and performance by each Obligor and any Approved Manager which is a member of the Group, and the transactions contemplated by, each Leasing Document to which such Obligors and Approved Manager is a party do not and will not conflict with:

(i)

any law or regulation applicable to it (including Anti-Money Laundering Laws, Anti- Bribery and Anti-Corruption Laws, Sanctions or laws relating to anti-trust or collusion and laws relating to human rights violation);

(ii)

its constitutional documents; and

(iii)

any agreement or instrument binding upon it or any of its assets or constitute a default or termination event (however described) under any such agreement or instrument;

(f)	the choice of governing law as stated in each Leasing Document and the agreement by the relevant parties thereto to refer disputes to the relevant courts or tribunals as stated in such Leasing Document are valid and binding against such parties;

(g)

under the laws of the Relevant Jurisdictions of each Obligor and Approved Manager which is a member of the Group it is not necessary for any of the Leasing Documents to which it is a party to be registered, filed, recorded, notarised or enrolled with any court or other authority in that jurisdiction or that any stamp, registration, notarial or similar taxes or fees be paid on or in relation to the Leasing Documents to which it is a party or the transactions contemplated by those Leasing Documents except payment of associated fees which registration, filings, taxes and fees will be made and paid promptly after the date of the relevant Leasing Documents to which it is a party;

(h)

each Security Document to which an Obligor or Approved Manager which is a member of the Group is a party does now or, as the case may be, will upon execution and delivery create, the Security Interests it purports to create over any assets to which such Security Interest, by its terms, relates, and such Security Interests will, when created or intended to be created, be valid and effective;

(i)

no party has any Security Interest (other than the Permitted Security Interests) or any other interest, right or claim over, in or in relation to the Vessel, this Charter, any moneys payable under any Leasing Document or over any assets which are, the subject of the Security Interests created or intended to be created by the Security Documents;

(j)

the obligations of each Obligor, under each Leasing Document to which it is a party, are the direct, general and unconditional obligations of such Obligor and rank at least pari passu with all other present and future unsecured and unsubordinated creditors of each Obligor save for any obligation which is mandatorily preferred by law and not by virtue of any contract;

(k)	all payments which an Obligor is liable to make under any Leasing Document to which such Obligor is a party may be made by such party without deduction or withholding for or on account of any tax payable under the laws of their jurisdiction of incorporation;

(l)	no Obligor has failed to pay all taxes applicable to, or imposed on or in relation to it, its business or if applicable, the Vessel;

(m)	no Obligor has breached any law or regulation which breach has or is reasonably likely to have a Material Adverse Effect;

(n)

no Obligor or other member of the Group, nor any of their subsidiaries, directors or officers, affiliates or any employee, has engaged in any activity or conduct which would violate any Anti- Bribery and Anti-Corruption Laws or Anti-Money Laundering Laws in any applicable jurisdiction and each Obligor and Group member has instituted and maintained policies and procedures designed to prevent violation of such laws, regulations and rules;

(o)

no Obligor or other member of the Group, nor any of their subsidiaries, directors or officers, or to the best of their knowledge affiliates or employees, has taken or will take any action in furtherance of an offer, payment, promise to pay or authorization or approval of the payment or giving of money, property, gifts or anything else of value, directly or indirectly, to any government official (which shall include without limitation, any officer or employee of a government or government owned or controlled entity or of a public international organisation or any person acting in an official capacity for and on behalf of the foregoing or any political party or party official or candidate for public office) to influence official action or secure an improper advantage;

(p)	no Environmental Claim has been made or threatened against any Obligor or any other member of the Group;

(q)	no Environmental Incident has occurred and no person has claimed that an Environmental Incident has occurred;

(r)

no Termination Event or Potential Termination Event has occurred or might reasonably be expected to result from the entry into and performance of this Charter or any other Leasing Document and no other event or circumstance is outstanding which constitutes a default or a termination event (however described) under any other agreement or instrument which is binding on it or to which its assets are subject;

(s)

no litigation, arbitration or administrative proceedings or investigations (including proceedings or investigations relating to any alleged or actual breach of the ISM Code or of the ISPS Code) of or before any court, arbitral body or agency have been started or threatened against any Obligor which has or is reasonably likely to have a Material Adverse Effect;

(t)

the consolidated financial statements delivered pursuant to Clause 49.1(a) are prepared in accordance with GAAP consistently applied and give a true and fair view of (if audited) or fairly represent (if unaudited) the financial condition of the Guarantor as at the end of the period to which such financial statements relate;

(u)	since the date of the Original Financial Statements or as the case may be, the date of any more recent financial statements delivered pursuant to Clause 49.1(a), there has been no material adverse change in the Guarantor’s or the Group’s business, assets or financial condition;

(v)	in relation to any information provided by any Obligor for the purposes of this Charter:

(i)

such information was true and accurate in all material respects as at the date it was provided or as at the date (if any) at which it is stated;

(ii)

any financial projections contained in such information have been prepared on the basis of recent historical information and on the basis of reasonable assumptions, and

(iii)

nothing has occurred or been omitted from any such information and no information has been given or withheld that results in any such information being untrue or misleading;

(w)	no corporate action, legal proceeding or other procedure or step described in Clause 47.1(g) or circumstances described in Clause 47.1(f) has been taken or exists or, to their knowledge, threatened in relation to an Obligor;

(x)	no Obligors, nor any of its assets are entitled to immunity on the grounds of sovereignty or otherwise from any legal action or proceeding (which shall include, without limitation, suit, attachment prior to judgment, execution or other enforcement);

(y)

for the purposes of the Regulation, the centre of main interest (as that term is used in Article 3(1) of the Regulation) of each Obligor is situated in its jurisdiction of incorporation and it has no “establishment” (as that term is used in Article 2(10) of the Regulation) in any other jurisdiction;

(z)	no Obligor is a US Tax Obligor and none of them have established a place of business in the United States of America;

(bb)	no Obligor, Approved Manager which is a member of the Group, sub-charterer (to the best of its knowledge) and no member of the Group:

(i)

is a Prohibited Person;

(ii)

is owned or controlled by or acting directly or indirectly on behalf of or for the benefit of, a Prohibited Person;

(iii)

owns or controls a Prohibited Person; or

(iv)

has a Prohibited Person serving as a director, officer or, to the best of its knowledge, employee;

–	GENERAL INFORMATION UNDERTAKINGS

(a)	they will send to the Owners:

(i)

as soon as possible, but in no event later than ninety (90) days after the end of each financial half year of the Charterers, the unaudited semi-annual management accounts of the Charterers;

(ii)

as soon as possible, but in no event later than one hundred and fifty (150) days after the end of each financial year of the Charterers, the unaudited annual management accounts of the Charterers;

(iii)

as soon as possible, but in no event later than ninety (90) days after the end of each financial half year of the Guarantor, the unaudited semi-annual consolidated financial accounts of the Guarantor;

(iv)

as soon as possible, but in no event later than one hundred and fifty (150) days after the end of each financial year of the Guarantor, the audited annual consolidated financial accounts of the Guarantor;

(b)

they will procure that each set of financial statements delivered pursuant to Clause 49.1(a) shall be certified by a duly authorised officer of the relevant company as giving a true and fair view (if audited) or fairly representing (if unaudited) its financial condition and operations as at the date as at which those financial statements were drawn up and the financial statements of the Guarantor shall be provided together with a Compliance Certificate signed by an authorized signatory of the Guarantor certifying that the financial covenants referred to in Clause 51 have been complied with and setting out all relevant calculations and statements demonstrating compliance with such financial covenants;

(c)

they will promptly provide to the Owners, copies of all notices and minutes relating to any of their extraordinary shareholders’ meetings which are despatched to the shareholders or to their creditors or any class thereof and its constitutional documents where these have been amended or varied (to the extent not contrary to the other provisions of this Charter);

(d)	they will provide the Owners promptly upon becoming aware of them, the details of:

(i)

any litigation, arbitration or administrative proceedings or investigations relating to any alleged or actual breach of any Sanctions or Anti-Money Laundering Laws which are current or pending against any Obligor, Approved Manager, sub-charterer or other member of the Group;

(ii)

any litigation, arbitration or administrative proceedings or investigations relating to any other matters not referred to in paragraph (i) above (including proceedings or investigations relating to any alleged or actual breach of the ISM Code or of the ISPS Code) in relation to an Obligor; and

(iii)

any Termination Event or Potential Termination Event that has occurred (and the steps, if any, being taken to remedy it);

(e)

they will, promptly upon a request by the Owners, supply to the Owners a certificate signed by an officer on its behalf certifying that no Termination Event or Potential Termination Event has occurred (or if a Termination Event or Potential Termination Event has occurred, specifying the nature of the Potential Termination Event or Termination Event (and the steps, if any, being taken to remedy it);

(f)	they will, as soon as practicable upon the request of the Owners, provide the Owners with any additional reasonable financial or other information relating to:

(i)

themselves, any Obligor and/or the Vessel (including, but not limited to the condition and location of the Vessel, its Earnings and its Insurances);

(ii)

details of the Vessel’s management and employment status and copies of all accurate, complete and up-to-date records and logs of all voyages made by the Vessel (but not more than once every twelve months);

(iii)

the Security Interests relating to any Leasing Documents;

(iv)

compliance of each Obligor and any Approved Manager with the terms of the Leasing Documents;

(v)

the financial condition, business and operations of the Obligors; or

(vi)

to any other matter relevant to, or to any provision of any Leasing Document to which it is a party,

(g)	they shall immediately notify the Owners in writing if any payments which they or any other Obligor, is liable to make under any Leasing Document is subject to deduction or withholding or any other tax whatsoever;

–	GENERAL UNDERTAKINGS

(a)

they will, and will procure that each other Obligor and each Approved Manager which is a member of the Group shall, obtain and promptly renew or procure the provision or renewal of and provide copies of, from time to time, any necessary consents, approvals, authorisations, licenses or permits of any regulatory body or authority for the transactions contemplated under each Leasing Document to which any Obligor and each Approved Manager which is a member of the Group is a party (including without limitation the sale, chartering and operation of the Vessel);

(b)	they will at their own cost, and will procure and each other Obligor and each Approved Manager which is a member of the Group, will:

(i)

ensure that any Leasing Document to they are a party validly creates the obligations and the Security Interests which such Leasing Document purports to create; and

(ii)

without limiting the generality of paragraph (i), promptly register, file, record or enrol any Leasing Document to which they are a party with any court or authority in all Relevant Jurisdictions, pay any stamp duty, registration or similar tax in all Relevant Jurisdictions in respect of any Leasing Document to which they are a party, give any notice or take any other step which, is or has become necessary or desirable for any such Leasing Document to be valid, enforceable or admissible in evidence or to ensure or protect the priority of any Security Interest which such Leasing Document creates;

(c)

they will not, and will procure each other Obligor will not, create or permit to subsist any Security Interest over any of its assets which are, the subject of the Security Interests created or intended to be created by the Security Documents, unless with the prior written approval of the Owners and save for Permitted Security Interests;

(d)

they will not, and will procure each Obligor will not, change the location of its centre of main interest (as that term is used in Article 3(1) of the Regulation) from that stated in relation to it under 48.1(y) and it will create no “establishment” (as that term is used in Article 2(10) of the Regulation) in any other jurisdiction;

(e)	except with the Owners’ prior written consent, they will not, and will procure each other Obligor will not, make a substantial change to the general nature of their respective businesses from that carried on at the date of this Charter;

(f)

except with the Owners’ prior written consent or where expressly permitted under the Leasing Documents, they will not, and will procure that each other Obligors will not, enter into any merger, amalgamation, demerger, solvent reorganisation or corporate reconstruction other than an internal group reorganisation under which the (i) the Charterers and Guarantor each survive and (ii) the Charterers remain wholly and directly (or indirectly) wholly owned by the Guarantor (and if indirectly owned, any replacement shareholder of the Charterers has entered into Share Security over the shares in the Charterers in a form acceptable to the Owners);

(g)	they will not:

(i)

enter into any borrowing except for loans from affiliates which are unsecured and fully subordinated to the Owners in a manner acceptable to the Owners and which are approved by the Owners in writing;

(ii)

incur any liabilities or obligations to any party except for those reasonably incurred in the ordinary course of operating, chartering, repairing and maintaining the Vessel;

(iii)

be the creditor in respect of any loan or any form of credit to any person;

(iv)

give or allow to be outstanding any guarantee or indemnity to or for the benefit of any person in respect of any obligation of any other person or enter into any document under which they assume any liability of any other person other than any guarantee or indemnity given under the Leasing Documents;

(v)

enter into a single transaction or a series of transactions (whether related or not) and whether voluntary or involuntary to sell, lease, transfer or otherwise dispose of the Vessel, its Earnings or its Insurances; and

(vi)

without prejudice to the above sub-paragraphs (i) to (vi), enter into any transaction (whether with another member of the Group or otherwise) which are, in any respect, less favourable than those which they could obtain an a bargain made at arms’ length; and

(h)

they will not, and shall procure that the Guarantor shall not, following the occurrence of a Termination Event which is continuing or where any of the following would result in the occurrence of a Potential Termination Event or Termination Event or suffering a net loss in respect of the preceding financial year:

(i)

declare, make or pay any dividend, charge, fee or other distribution (or interest on any unpaid dividend, charge, fee or other distribution) (whether in cash or in kind) on or in respect of its shares (or any class of its shares);

(ii)

repay or distribute any dividend or share premium reserve;

(iii)

pay any management, advisory or other fee to or to the order of any of its shareholders; or

(iv)

redeem, repurchase, defease, retire or repay any of their shares or resolve to do so.

–	FINANCIAL COVENANTS

(a)	On each Testing Date and for the relevant Accounting Period throughout the Charter Period:

(i)

Cash and Cash Equivalents divided by the number of Fleet Vessels shall not be lower than $500,000; and

(ii)

the Leverage Ratio shall not be more than 85 per cent.

(i)

the financial year of the Guarantor ending 31 December of each calendar year; or

(ii)

the financial half year of the Guarantor ending 30 June of each calendar year,

–	VALUATIONS

(a)	they shall at their cost:

(i)

provide to the Owners valuations of the Vessel (to be addressed to the Owners) to enable the Owners to determine the Initial Market Value of the Vessel; and

(ii)

at least twice per calendar year (on each Testing Date) and at any time after the occurrence of a Potential Termination Event or Termination Event which is continuing if requested by the Owners, provide to the Owners valuations of the Vessel (or any other vessel over which additional Security Interests have been created in accordance with Clause 52.1(b)) (to be addressed to the Owners) to enable the Owners to determine the Fair Market Value of the Vessel or such other relevant vessel; and

(b)

if at any time, the Vessel’s Fair Market Value falls below an amount equivalent to one hundred and twenty per cent (120%) of the Owners’ Costs (the “LTV Breach”, and the said difference between the Fair Market Value and one hundred and twenty per cent (120%) of the Owners’ Costs shall be referred to as the “shortfall” for the purposes of this paragraph), the Charterers shall, promptly and in any event no later than the date falling thirty (30) days from the date which the valuations relating to the Vessel’s Fair Market Value are received by the Owners and in the Owners’ sole discretion, either:

(i)

make payment in an amount such as to eliminate the shortfall which payment shall be deemed to be an advance payment of hire and credited against future instalment(s) of Fixed Charterhire (or part thereof) payable in inverse order of maturity of payments of Fixed Charterhire; and/or