Exhibit 10.3.5
CODE WORD FOR THIS CHARTER PARTY "SHELLTIME 4"
Issued December 1984
TIME CHARTER PARTY
IT IS THIS DAY 20 of October 2004 AGREED between Victory
Ltd. of ▇▇▇▇▇▇▇▇, Bermuda (hereinafter referred to as
"Owners"), being owners of the good motor tanker vessel
called M/T "STENA VICTORY" (hereinafter referred to as "the
vessel") described as per Clause 1 hereof and CM V-▇▇▇ ▇▇
Limited of ▇▇▇▇▇▇▇▇, Bermuda (hereinafter referred to as
"Charterers"):
Description and 1. At the date of delivery of the vessel under this
Condition of charter
Vessel
(a) she shall be classed:
(b) she shall be in every way fit to carry crude
petroleum and/or its products;
(c) she shall be tight, staunch, strong. in good
order and condition, and in every way fit for the service.
with her machinery, boilers. hull and other equipment
(including but not limited to hull stress calculator and
radar). in a good and efficient state:
(d) her tanks. valves and pipelines shall be
oil-tight:
(e) she shall be in every way fitted for burning
at sea - fueloil with a maximum viscosity of 380 as per ISO
8217:1996 ▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇▇▇ at 50 degrees Centigrade for
main propulsion. marine diesel oil as per ISO 8217:1996 DMC
for auxiliaries
in port - marine diesel oil for auxiliaries;
(f) she shall comply with the regulations in force
so as to enable her to pass through the Suez and Panama
Canals by day and night without delay:
(g) she shall have on board all certificates,
documents and equipment required from time to time by any
applicable law to enable her to perform the charter service
without delay;
(h) she shall comply with the description in
Questionnaire 88 appended hereto, provided however that if
there is any conflict between the provisions of
Questionnaire 88 and any other provision, including this
Clause 1, of this charter such other provision shall govern.
Shipboard 2. (a) At the date of delivery of the vessel under this
Personnel charter and throughout the duration of this Charter
and their Duties
(i) she shall have a full and efficient
complement of master, officers and crew for a vessel of her
tonnage. who shall in any event be not less than the number
required by the laws of the flag state and who shall be
trained to operate the vessel and her equipment competently
and safely;
(ii) all shipboard personnel shall hold valid
certificates of competence in accordance with the
requirements of the law of the flag state;
(iii) all shipboard personnel shall be
trained in accordance with the relevant provisions of the
International Convention on Standards of Training.
Certification and Watch keeping for Seafarers. 1978;
(iv) three shall be on board sufficient
personnel with a good working knowledge of the English
language to enable cargo operations at loading and
discharging places to be carried out efficiently and safely
and to enable communications between the vessel and chose
loading the vessel or accepting discharge therefrom to be
carried out quickly and efficiently.
(b) Owners guarantee that throughout the charter
service the master shall with the vessel's officers and
crew, unless otherwise ordered by Charterers,
(i) prosecute all voyages with the utmost
despatch:
(ii) render all customary assistance; and
(iii) load and discharge cargo as rapidly as
possible when required by Charterers or their agents to do
so, by night or by day, but always in accordance with the
laws of the place of loading or discharging (as the case may
be) and in each case in accordance with any applicable laws
of the flag state.
Duty to 3. (i) Subject to Clause 94 throughout the charter
Maintain service Owners shall, whenever the passage of time, wear and
tear or any event (whether or not coming within Clause 27
hereof) requires steps to be taken to maintain or restore
the conditions stipulated in Clauses 1 and 2(a), exercise
due diligence so to maintain or restore the vessel.
(ii) If at any time whilst the vessel is on hire
under this charter the vessel fails to comply with the
requirements of Clauses 1, 2(a) or 10 then hire shall be
reduced to the extent necessary to indemnify Charterers for
such failure. If and to the extent that such failure affects
the time taken by the vessels to perform any services under
this charter, hire shall be reduced by an amount equal to
the value, calculated at the rate of hire, of the time so
lost.
(iii) If Owners are in breach of their obligation
under Clause 3(i) Charterers may so notify Owners in
writing; and if, after the expiry of 30 days following the
receipt by Owners of any such notice, Owners have failed to
demonstrate to Charterers' reasonable satisfaction the
exercise of due diligence as required in Clause 3(i). the
vessel shall be off-hire, and no further hire payments shall
be due, until Owners have so demonstrated that they are
exercising such due diligence.
Period Trading 4. Owners agree to let and Charterers agree to hire the
Limits vessel for a period of five years commencing on the date of
delivery under the Memorandum of Agreement for the vessel,
dated as of the date hereof, between Owners and CM V-▇▇▇ ▇▇
Limited, Bermuda, (the "MOA"), unless extended under Clause
49 for the purpose of carrying all lawful merchandise
(subject always to Clause 28) within the trading limits
agreed in Clause 45. Notwithstanding the foregoing, but
subject to Clause 35. Charterers may order the vessel to
ice-bound waters or to any part of the world outside such
limits provided that Owners consent thereto (such consent
not to be unreasonably withheld) and that Charterers pay for
any insurance premium acquired by the vessels underwriters
as a consequence of such order.
premium required by the vessel's underwriters as a
consequence of such order.
Charterers shall use due diligence to ensure that the
vessel is only employed between and at safe places (which
expression when used in this charter shall include ports,
berths, wharves. docks. anchorages. submarine lines,
alongside vessels or lighters, and other locations including
locations at sea) where she can safely lie always afloat.
Notwithstanding anything contained in this or any other
clause of this charter, Charterers do not warrant the safety
of any place to which they order the vessel and shall be
under no liability in respect thereof except for loss or
damage caused by their failure to exercise due diligence as
aforesaid. Subject as above, the vessel shall be loaded and
discharged at any places as Charterers may direct, provided
that Charterers shall exercise due diligence to ensure that
any ship-to-ship transfer operations shall conform to
standards not less than those set out in the latest
published edition of the ICS/OCIMF Ship-to-Ship Transfer
Guide.
The vessel shall be delivered by Owners at a port or at
sea at Charterer's option and redelivered to Owners at a
major oil port world wide at Charterers' option.
Laydays/ 5. The delivery of the vessel under this Charter shall
Cancelling be deemed to have occurred and this Charter shall be
effective as of delivery of the Vessel to the Owners under
the MOA. See Clause 99.
Owners to 6. Owners undertake to provide and to pay for all
Provide provisions, wages, and shipping and discharging fees and all
other expenses of the master, officers and crew; also,
except as provided in Clauses 4 and 34 hereof, for all
insurance on the vessel, for all deck, cabin and engine-room
stores, and for water; for all drydocking, overhaul,
maintenance and repairs to the vessel; and for all
fumigation expenses and de-rat certiciates. Owners'
obligations under this Clause 6 extend to all liabilities
for customs or import duties arising at any time during
the performance of this charter in relation to the personal
effects of the master, officers and crew, and in relation to
the stores, provisions and other matters aforesaid which
Owners are to provide and pay for and Owners shall refund to
Charterers any sums Charterers or their agents may have paid
or been compelled to pay in respect of any such liability.
Any amounts allowable in general average for wages and
provisions and stores shall be credited to Charterers
insofar as such amounts are in respect of a period when the
vessel is on-hire.
Charterers to 7. Charterers shall provide and pay for all fuel, towage
Provide and pilotage and shall pay agency fees, port charges,
commissions, expenses of loading and unloading cargoes,
canal dues and all charges other than those payable by
Owners in accordance with Clause 6 hereof, provided that all
charges for the said items shall be for Owners' account when
such items are consumed, employed or incurred for Owners'
purposes or while the vessel is off-hire (unless such items
reasonably relate to any service given or distance made good
and taken into account under Clause 21 or 22); and provided
further that any fuel used in connection with a general
average sacrifice or expenditure shall be paid for by
Owners.
Rate of 8. Subject as herein provided, Charterers shall pay for
Hire the use and hire of the vessel at the rate agreed in Clause
47 per day, and pro rata for any part of a day, from the
time and date of her delivery UTC until the time and date of
her redelivery (UTC) to Owners.
Payment of 9. Payment of hire shall be made in immediately
Hire available funds to:
a bank and bank account nominated by the Owners per calendar
month in advance, less any hire paid which Charterers
reasonably estimate to relate to off-hire periods.
Charterers shall not be responsible for any delay or error
by Owners' bank in crediting Owners' account provided that
Charterers have made proper and timely payment.
In default of such proper and timely payment,
(a) Owners shall notify Charterers of such default
and Charterers shall within seven days of receipt of such
notice pay to Owners the amount due including interest,
failing which Owners may withdraw the vessel from the
service of Charterers without prejudice to any other rights
Owners may have under this charter or otherwise; and
(b) Interest on any amount due but not paid on the
due date shall accrue from the day after that date up to and
including the day when payment is made, at a rate per annum
which shall be 1% above the U.S. Prime Internet Rate as
published by the ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ in New York at 12.00 New
York time on the due date, or, if no such interest rate is
published on that day, the interest rate published on the
next preceding day on which such a rate was so published,
computed on the basis of a 360 day year of twelve 30-day
months, compounded semi-annually.
Space 10. The whole research, burthen and decks of the vessel
Available to and any passenger accommodation (including Owners' suite)
Charterers shall be at Charterers' disposal, reserving only proper and
sufficient space for the vessel's master, officers, crew,
tackle, apparel, furniture, provisions and stores, provided
that the weight of stores on board shall not, unless
specially agreed, exceed 350 tonnes at any time during the
charter period.
Overtime 11. Overtime pay of the master, officers and crew in
accordance with ship's articles shall be for Charterers
account when incurred, as a result of complying with the
request of complying with the request of Charterers or their
agents, for loading, discharging, heating of cargo,
bunkering or tank cleaning.
Instructions 12. Charterers shall from time to time give the master
and Logs all requisite instructions and sailing directions, and he
shall keep a full and correct log of the voyage or voyages,
which Charterers or their agents may inspect as required.
The master shall when required furnish Charterers or their
agents with a true copy of such log and with properly
completed loading and discharging port sheets and voyage
reports for each voyage and other returns as Charterers may
require. Charterers shall be entitled to take copies at
their expense of any such documents which are not provided
by the master. All reports are to be made in English.
Bills of Lading 13. (a) The master (although appointed by Owners) shall
be under the orders and direction of Charterers as regards
employment of the vessel, agency and other arrangements, and
shall sign bills of lading as Charterers or their agent may
direct (subject always to Clauses 35(a) and 40) without
prejudice to this charter. Charterers hereby indemnify
Owners against all consequences that may arise.
(i) from signing bills of lading in accordance
with the directions of Charterers or their agents, to the
extent that the terms of such bills of lading fall to
conform to the requirements of this charter, or (except as
provided in Clause 13(b)) from the master otherwise
complying with Charterers' or their agents' orders:
(ii) from any irregularities in papers
supplied by Charterers or their agents.
(b) Notwithstanding the foregoing, Owners shall not
be obliged to comply with any orders from Charterers to
discharge all or part of the cargo
(i) at any place other than that shown on the
▇▇▇▇ of lading and/or
(ii) without presentation of an original ▇▇▇▇
of lading
unless they have received from Charterers both
written confirmation of such orders and an indemnity in a
form acceptable to Owners. See also Clause 55.
Conduct of 14. If Charterers complain of the conduct of the master
Vessel's or any of the officers or crew, Owners shall immediately
Personnel investigate the complaint. If the complaint proves to be
well founded, Owners shall, without delay, make a change in
the appointments and Owners shall in any event communicate
the result of their investigations to Charterers as soon as
possible.
Bunkers at 15. Owners acknowledge that bunkers on board at
Delivery and delivery are property of Charterers. Owners shall on
Redelivery redelivery (whether it occurs at the end of the charter
period or on the earlier termination of this charter) accept
and pay for all bunkers remaining on board, at the price
paid at the vessel's last port of bunkering before
redelivery.
Stevedores, 16. Stevedores when required shall be employed and paid
Pilots, Tugs by Charterers, but this shall not relieve Owners from
responsibility at all times for proper stowage, which must
be controlled by the master who shall keep a strict account
of all cargo loaded and discharged. Owners hereby indemnify
Charterers, their servants and agents against all losses,
claims, responsibilities and liabilities arising in any way
whatsoever from the employment of pilots, tugboats or
stevedores, who although employed by Charterers shall be
deemed to be the servants of and in the service of Owners
and under their instructions (even if such pilots, tugboat
personnel or stevedores are in fact the servants of
Charterers their agents or any affiliated company):
provided, however, that
(i) the foregoing indemnity shall not exceed
the amount to which Owners would have been entitled to limit
their liability if they had themselves employed such pilots,
tugboats or stevedores, and
(ii) Charterers shall be liable for any damage
to the vessel caused by or arising out of the use of
stevedores, fair wear and tear excepted, to the extent that
Owners are unable by the exercise of due diligence to obtain
redress therefor from stevedores.
Supernumeraries 17. Charterers may send representatives in the vessel's
available accommodation upon any voyage made under this
charter.
Sub-letting 18. Charterers may sub-let the vessel, but shall always
remain responsible to Owners for due fulfillment of this
charter.
Final Voyage 19. If when a payment of hire is due hereunder
Charterers reasonably expect to redeliver the vessel before
the next payment of hire would fall due, the hire to be paid
shall be assessed on Charterers' reasonable estimate of the
time necessary to complete Charterers' programme up to
redelivery, and from which estimate Charterers may deduct
amounts due or reasonably expected to become due for bunkers
on board at redelivery pursuant to Clause 15.
Promptly after redelivery any overpayment shall be refunded
by Owners or any underpayment made good by Charterers.
If at the time this charter would otherwise terminate in
accordance with Clause 4 the vessel is on a ballast voyage
to a port of redelivery or is upon a laden voyage,
Charterers shall continue to have the use of the vessel at
the same rate and conditions as stand herein for as long as
necessary to complete such ballast voyage, or to complete
such laden voyage and return to a port of redelivery as
provided by this charter, as the case may be.
Loss of 20. Should the vessel be lost, this charter shall
Vessel terminate and hire shall cease at noon on the day of loss;
should the vessel be a constructive total loss, this
charter shall terminate and hire shall cease at noon on the
day on which the vessel's underwriters agree that the
vessel is a constructive total loss; should the vessel be
missing, this charter shall terminate and hire shall cease
at noon on the day on which she was last heard of. Any hire
paid in advance and not earned shall be returned to
Charterers and Owners shall reimburse Charterers for the
value of the estimated quantity of bunkers on board at the
time of termination, at the price paid by Charterers at the
last bunkering port.
Off-hire 21. (a) On each and every occassion that there is loss
of time (whether by way of interruption in the vessel's
service or, from reduction in the vessel's performance, or
in any other manner)
(i) due to deficiency of personnel or stores;
repairs; gas-freeing for repairs; time in and waiting to
enter dry dock for repairs; breakdown (whether partial or
total) of machinery, boilers or other parts of the vessel or
her equipment (including without limitation tank coatings);
overhaul, maintenance or survey; collision, stranding,
accident or damage to the vessel; or any other similar cause
preventing the efficient working of the vessel; and such
loss continues for more than three consecutive hours (if
resulting from interruption in the vessel's service) or
cumulates to more than three hours (if resulting from
partial loss service); or
(ii) due to industrial action, refusal to
sail, breach of orders or neglect of duty on the part of the
master, officers or crew; or
(iii) for the purpose of obtaining medical
advice or treatment for or landing any sick or injured
person (other than a Charterers' representative carried
under Clause 17 hereof) or for the purpose of landing the
body of any person (other than Charterers' representative),
and such loss continue for more than three consecutive
hours; or
(iv) due to any delay in quarantine arising
from the master, officers or crew having had communication
with the shore at any infected area without the written
consent or instructions of Charterers or their agents, or to
any detention by customs or other authorities caused by
smuggling or other infraction of local law on the part of
the master, officers, or crew; or
(v) due to detention of the vessel by
authorities at home or abroad attributable to legal action
against or breach of regulations by the vessel, the vessel's
owners, or Owners (unless brought about by the act or
neglect of Charterers); then without prejudice to Charterers
rights under Clause 3 or to any other rights of Charterers
hereunder or otherwise the vessel shall be off-hire from the
commencement of such loss of time until she is again ready
and in an efficient state to resume her service from a
position not less favourable to Charterers than that at
which such loss of time commenced; provided, however, that
any service given pr distance made good by the vessel whilst
off-hire shall be taken into account in assessing the amount
to be deducted from hire.
(b) If the vessel fails to proceed at any guaranteed
speed pursuant to Clause 24, and such failure arises wholly
or partly from any of the causes set out in Clause 21(a)
above, then the period for which the vessel shall be
off-hire under this Clause 21 shall be the difference
between
(i) the time the vessel would have required
to perform the relevant service at such guaranteed speed,
and
(ii) the time actually taken to perform such
service (including any loss of time arising from
interruption in the performance of such service).
For the avoidance of doubt, all time included under
(ii) above shall be excluded from any computation under
Clause 24.
(c) Further and without prejudice to the foregoing,
in the event of the vessel deviating (which expression
includes without limitation putting back, or putting into
any port other than that to which she is bound under the
instructions of Charterers) for any cause or purpose
mentioned in Clause 21(a), the vessel shall be off-hire from
the commencement of such deviation until the time when she
is again ready and in an efficient state to resume her
service from a position not less favourable to Charterers
than that at which the deviation commenced, provided,
however, that any service given or distance made good by the
vessel whilst so off-hire shall be taken into account in
assessing the amount to be deducted from hire. If the
vessel, for any cause or purpose mentioned in Clase 21(a),
puts into any port other than the port to which she is bound
on the instructions of Charterers, the port charges,
pilotage and other expenses at such port shall be borne by
Owners. Should the vessel be driven into any port or
anchorage by stress of weather hire shall continue to be due
and payable during any time lost thereby.
(d) If the vessel's flag state becomes engaged in
hostilities, and Charterers in consequence of such
hostilities find it commercially impracticable to employ the
vessel and have given Owners written notice thereof then
from the date of receipt by Owners of such notice until the
termination of such commercial impracticability the vessel
shall be off-hire and Owners shall have the right to employ
the vessel on their own account.
(e) Time during which the vessel is off-hire under
this charter shall count as part of the charter period.
Periodical 22.(a) Owners have the obligation to drydock the
Drydocking vessel at regular intervals as agreed by Charterers. On
each occasion Owners shall propose to Charterers a date on
which they wish to drydock the vessel, not less than two
months before such date, and Charterers shall offer a port
for such periodical drydocking and shall take all
reasonable steps to make the vessel available as near to
such date as practicable.
Owners shall put the vessel in drydock at their
expense as soon as practicable after Charterers place the
vessel at Owners' disposal clear of cargo sediments and gas
free. Charters shall be responsible for and pay for the
disposal into reception facilities of tank washings and
residues and shall have the right to retain any monies
received therefor, without prejudice to any claim for loss
of cargo under any ▇▇▇▇ of lading or this charter.
The expenses of gas-freeing, including without
limitation the cost of bunkers, shall be for Owners account.
Ship Inspection 23. Charterers shall have the right at any time
during the charter period to make such inspection of the
vessel as they may consider necessary. This right may be
exercised as often and at such interval as Charterers in
their absolute discretion may determine and whether the
vessel is in port or on passage, Owners affording all
necessary co-operation and accommodation on board provided,
however, that neither the exercise nor the non-exercise, nor
anything done or not done in the exercise or non-exercise,
by Charterers of such right shall in any way reduce the
master's or Owners' authority over, or Charters'
responsibilities to Owners or third parties for the same.
See also Clause 84.
Detailed 24.(a) Owners guarantee that the speed and
Description consumption of the vessel shall be as follows:-
and Performance
Average speed Maximum average bunker consumption
in knots main propulsion -- auxiliaries
fuel oil/diesel oil fuel oil/diesel
Laden tonnes tonnes
See Clause 71
Ballast
The foregoing bunker consumptions are for all purposes
except cargo heating and tank cleaning and shall be pro-
rated between the speeds shown.
The service speed of the vessel is knots laden and
knots in ballast and in the absence of Charterers' orders
to the contrary the vessel shall proceed at the service
speed. However if more than one laden and one ballast speed
are shown in the table above Charterers shall have the
right to order the vessel to steam at any speed within the
range set out in the table (the "ordered speed").
If the vessel is ordered to proceed at any speed
other than the highest speed shown in the table, and the
average speed actually attained by the vessel during the
currency of such order exceeds such ordered speed plus 0.5
knots (the "maximum recognised speed"), then for the purpose
of calculating any increase or decrease of hire under this
Clause 24 the maximum recognised speed shall be used in
place of the average speed actually attained.
For the purpose of this charter the "guaranteed
speed" at any time shall be then--current ordered speed or
the service speed, as the case may be
The average speeds and bunker consumptions shall for
the purpose of this Clause 24 be calculated by reference to
the observed distance from pilot station to pilot station on
all sea passages during each period stipulated in Clause
24(c), but excluding any time during which the vessel is
(or but for Clause 22(b)(i) would be) off-hire and also
excluding "Adverse Weather Periods", being (i) any periods
during which reduction of speed is necessary for safety in
congested waters or in poor visibility (ii) any days, noon
to noon, when winds exceed force [5] on the Beaufort Scale
for more than 12 hours.
(b) If during any year from the date on which the
vessel enters service (anniversary to anniversary) the
vessel falls below the performance guaranteed in Clause
24(a) then if such shortfall results
(i) from a reduction in the average speed to the
speed guaranteed in Clause 24(a), then an amount equal to
the value at the hire rate of the time so lost or gained, as
the case may be, shall be deducted from or added to the hire
paid:
(ii) from an increase in the total bunkers consumed,
compared to the total bunkers which would have been consumed
had the vessel performed as guaranteed in Clause 24(a), an
amount equivalent to the value of the additional bunkers
consumed based on the average price paid by Charterers for
the vessel's bunkers in such period, shall be deducted from
or added to the hire paid.
The deduction from hire so calculated for laden and
ballast mileage shall be adjusted to take into account the
mileage steamed in each such condition during Adverse
Weather Periods, by dividing such deduction by the number of
miles over which the performance has been calculated and
multiplying by the same number of miles plus the miles
steamed during the Adverse Weather Periods, in order to
establish the total deduction from hire to be made for such
period.
Reduction of hire under the foregoing sub-Clause
(b) shall be without prejudice to any other remedy available
to Charterers.
(c) Calculations under this Clause 24 shall be
made for the yearly periods terminating on each successive
anniversary of the date on which the vessel enters service,
and for the period between the last such anniversary and the
date of termination of this charter if less than a year.
Claims in respect of reduction of hire arising under this
Clause during the final year or part year of the charter
period shall in the first instance be settled in accordance
with Charterers' estimate made two months before the end of
the charter period. Any necessary adjustment after this
charter terminates shall be made by payment by Owners to
Charterers or by Charterers to Owners as the cse may
require.
Salvage 25. Subject to the provisions of Clause 21 hereof,
all loss of time and all expenses (excluding any damage to
or loss of the vessel or tortious liabilities to third
parties) incurred in saving or attempting to save life or in
successful or unsuccessful attempts at salvage shall be
borne equally by Owners and Charterers provided that
Charterers shall not be liable to contribute towards any
salvage payable by Owners arising in any way out of services
rendered under this Clause 25. All salvage and all proceeds
from derelicts shall be divided equally between Owners and
Charterers after deducting the masters, officers' and crew's
share.
Lien 26. Owners shall have a lien upon all cargoes and
all freights, sub-freights and demurrage for any amounts
due under this charter: and Charterers shall have a lien on
the vessel for all monies paid in advance and not earned,
and for all claims for damages arising from any breach by
Owners of this charter.
Exceptions 27. (a) The vessel, her master and Owners shall not,
unless otherwise in this charter expressly provided, be
liable for any loss or damage or delay or failure arising
or resulting from any act, neglect or default of the master,
pilots, mariners or other servants of Owners in the
navigation or management of the vessel; fire, unless caused
by the actual fault or privity of Owners; collision or
stranding; dangers and accidents of the sea; explosion.
bursting of boilers, breakage of shafts or any latent
defect in hull, equipment or machinery; provided. however,
that Clauses 1, 2. 3 and 24 hereof shall be unaffected by
the foregoing. Further, neither the vessel, her master or
Owners, nor Charterers shall, unless otherwise in this
charter expressly provided, be liable for any loss or
damage. or delay or failure in performance hereunder arising
or resulting from act of God, act of war, seizure under
legal process, quarantine restrictions, strikes, lock-outs.
riots, restraints of labour, civil commotions or arrest or
restraint of princes, rulers or people.
(b) The vessel shall have liberty to sail with or
without pilots, to tow or go to the assistance of vessels in
distress and to deviate for the purpose of saving life or
property.
(c) Clause 27(a) shall not apply to or affect any
liability of Owners or the vessel or any other relevant
person in respect of
(i) loss or damage caused to any berth. jetty, dock.
dolphin, buoy. mooring line. pipe or crane or other works or
equipment whatsoever at or near any place to which the
vessel may proceed under this charter, whether or not such
works or equipment belong to Charterers, or'
(ii) any claim (whether brought by Charterers or any
other person) arising out of any loss of or damage to or in
connection with cargo. All such claims shall be subject to
the Hague-Visby Rules or the Hague Rules. as the case may
be, which ought pursuant to Clause 38 hereof to have been
incorporated in the relevant ▇▇▇▇ of lading (whether or not
such Rules were so incorporated) or, if no such ▇▇▇▇ of
lading is issued. to the Hague-Visby Rules.
(d) In particular and without limitation. the
foregoing subsections (a) and (b) of this Clause shall not
apply to or in any way affect any provision in this charter
relating to off-hire or to reduction of hire.
Injurious Cargoes 28. No acids, explosives or cargoes injurious to the
vessel shall be shipped and without prejudice to the
foregoing any damage to the vessel caused by the shipment
of any such cargo. and the time taken to repair such damage,
shall be for Charterers' account. No voyage shall be
undertaken. nor any goods or cargoes loaded. that would
expose the vessel to capture or seizure by rulers or
governments:
Grade of Bunkers 29. Charterers shall supply marine diesel oil/fuel
oil with a maximum viscosity of 380 Centistokes at 50
degrees Centigrade for main propulsion and diesel oil.
If Owners require the vessel to be supplied with more
expensive bunkers they shall be liable for the extra cost
thereof.
Disbursements 30. Should the master require advances for ordinary
disbursements at any port, Charterers or their agents shall
make such advances to him.
Laying-up 31. Charterers shall have the option, after
consultation with Owners, of requiring Owners to lay up the
vessel at a sate place nominated by Charterers. in which
case the hire provided for under this charter shall he
adjusted to reflect any net increases in expenditure
reasonably incurred or any net saving which should
reasonably be made by Owners as a result of such lay-up.
Charterers may exercise the said option any number of times
during the charter period. See also Clause 82.
Requisition 32. Should the vessel be requisitioned by any
government. de facto or de jure. during the period of this
charter. the vessel shall be off-hire during the period of
suck requisition, and any hire paid by such government in
respect of such requisition period shall be for Owners'
account. Any such requisition period shall count as part of
the charter period.
33.
Additional War 34. If the vessel is ordered to trade in areas where
Expenses there is war (de facto or de jure) or threat of war.
Charterers shall reimburse Owners for any additional
insurance premia, crew bonuses and other expenses which are
reasonably incurred by Owners as a consequence of such
orders, provided that Charterers are given notice of such
expenses as soon as practicable and in any event before such
expenses are incurred, and provided further that Owners
obtain from their insurers a waiver of any subrogated rights
against Charterers in respect of am claims by Owners under
their war risk insurance arising out of compliance with such
orders.
War Risks 35. (a) The master shall not be required or bound to
sign bills of lading for any place which in his or Owners'
reasonable opinion is dangerous or impossible for the vessel
to enter or reach owing to any blockade. war, hostilities,
warlike operations, civil war, civil commotions or
revolutions.
(b) If in the reasonable opinion of the master or
Owners it becomes, for any of the reasons set out in Clause
35(a) or by the operation of international law. dangerous,
impossible or prohibited for the vessel to reach or enter,
or to load or discharge cargo at, any place to which the
vessel has been ordered pursuant to this charter (a "place
of peril")., then Charterers or their agents shall be
immediately notified by telex or radio messages, and
Charterers shall thereupon have the right to order the
cargo. or such part of it as may be affected, to be loaded
or discharged, as the case may be. at any other place within
the trading limits of this charter (provided such other
place is not itself a place of peril). If any place of
discharge is or becomes a place of peril, and no orders have
been received from Charterers or their agents within 48
hours after dispatch of such messages, then Owners shall be
at liberty to discharge the cargo or such part of it as may
be affected at any place which they or the master may in
their or his discretion select within the trading limits of
this charter and such discharge shall be deemed to be due
fulfilment of Owners' obligations under this charter so far
as cargo so discharged is concerned.
(c) The vessel shall have liberty to comply with am'
directions or recommendations as to departure. arrival,
routes, ports of cal], stoppages, destinations, zones,
waters, delivery or in any other wise whatsoever given by
the government of the state under whose flag the vessel
sails or any other government or local authority or by any
person or body acting or purporting to act as or with the
authority of any such government or local authority
including any de facto government or local authority or by
any person or body acting or purporting to act as or with
the authority of any such government or local authority or
by any committee or person having under the terms of the war
risks insurance on- the vessel the right to give any such
directions or recommendations. If by reason of or in
compliance with any such directions or recommendations
anything is done or is not done. such shall not be deemed a
deviation.
If by reason of or in compliance with any such
direction or recommendation the vessel does not proceed to
any place of discharge to which she has been ordered
pursuant to this charter, the vessel may proceed to any
place which the master or Owners in his or their discretion
select and there discharge the cargo or such part of it as
may be affected. Such discharge shall be deemed to be due
fulfilment of Owners' obligations under this charter so far
as cargo so discharged is concerned.
Charterers shall procure that all bills of lading
issued under this charter shall contain the Chamber of
Shipping War Risks Clause 1952.
Both to Blame 36. If the liability for any collision in which the
Collision Clause vessel is involved while performing this charter falls to be
determined in accordance with the laws of the United States
of America, the following provision shall apply:
"If the ship comes into collision with another ship
as a result of the negligence of the other ship and any act,
neglect or default of the master, mariner, pilot or the
servants of the carrier in the navigation or in the
management of the ship, the owners of the cargo carried
hereunder will indemnify the carrier against all loss. or
liability to the other or non-carrying ship or her owners in
so far as such loss or liability represents loss of. or
damage to, or any claim whatsoever of the owners of the said
cargo, paid or payable by the other or non-carrying ship or
her owners to the owners of the said cargo and set off,
recovered or recovered by the other or non-carrying ship or
her owners as part of their claim against the carrying ship
or carrier."
"The foregoing provisions shall also apply where the
owners, operators or those in charge of am' ship or ships or
objects other than, or in addition to, the colliding ships
or objects are at fault in respect of a collision or
contact."
Charterers shall procure that all bills of lading
issued under this charter shall contain a provision in the
foregoing terms to be applicable where the liability for any
collision in which the vessel is involved falls to be
determined in accordance with the laws of the United States
of America.
New ▇▇▇▇▇
Clause 37. General average contributions shall be payable
according to the York/Antwerp Rules. 1974 as amended in 1994, and
shall be adjusted in London in accordance with English law and
practice but should adjustment be made in accordance with the law and
practice of the United States of America, the following provision
shall apply:
"In the event of accident, danger, damage or disaster
before or after the commencement of the voyage, resulting from any
causes whatsoever, whether due to negligence or not. for which, or for
the consequences of which, the carrier is not responsible by statute,
contract or otherwise, the caro, shippers, consignees or owners of
the cargo shall contribute with the carrier in general average to the
payment of any sacrifices, losses or expenses of a general average
nature that may be made or incurred and shall pay salvage and special
charges incurred in respect of the cargo."
"If a salving ship is owned or operated by the carrier,
salvage shall be paid for as fully as if the said salving ship or
ships belonged to strangers. Such deposit as the carrier or his agents
may deem sufficient to cover the estimated contribution of the cargo
and any salvage and special charges thereon shall, if required, be
made by the cargo, shippers, consignees or owners of the cargo to the
carrier before delivery."
Charterers shall procure that all bills of lading issued
under this charter shall contain a provision in the foregoing terms,
to be applicable where adjustment of general average is made in
accordance with the laws and practice of the United States of America.
Clause 38.
Paramount
See Clause 96
TOUALOP 39. See Clause 53
See Clause 52
Export 40. The master shall not be required or bound to sign bills
Restrictions of lading for the carriage of cargo to any place to which export
of such cargo is prohibited under the laws, rules or regulations
of the country in which the cargo was produced and/or shipped.
Charterers shall procure that all bills of lading issued
under this charter shall contain the following clause:
"If any laws rules or regulations applied by the government of the
country in which the cargo was produced and: or shipped, or any
relevant agency thereof, impose a prohibition on export of the
cargo to the place of discharge designated in or ordered under
this ▇▇▇▇ of lading, carriers shall be entitled to require cargo
owners forthwith to nominate an alternative discharge place for
the discharge of the cargo, or such part of it as may be affected,
which alternative discharge place shall not be subject to the
prohibition, and carriers shall be entitled to accept orders from
cargo owners to proceed to and discharge at such alternative
place. If cargo owners fait to nominate an alternative place
within 72 hours after they or their agents have received from
carriers notice of such prohibition, carriers shall be at liberty
to discharge the cargo or such part of it as may be affected
by the prohibition at any safe place on which they or the master
may in their or his absolute discretion decide and which is not
subject to the prohibition, and such discharge shall constitute
due performance of the contract contained in this ▇▇▇▇ of lading
so far as the cargo so discharged is concerned".
The foregoing provision shall apply mutatis mutandis to this
charter, the references to a ▇▇▇▇ of lading being deemed to be
references to this charter.
Law and 41.(a) This charter shall be construed and the relations
Litigation between the parties determined in accordance with the laws of
England. See Clause 98
Construction 42. The side headings have been included in this charter for
convenience of reference and shall in no way affect the
construction hereof. Rider Clauses 43 - 99 as attached and
Questionnaire 88 to form an integral part of this Charter Party.
Owners Charterers
/s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
------------------------- ----------------------
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇
Director Director
RIDER CLAUSES 43 - 99 TO SHELLTIME 4
TIME CHARTER PARTY FOR M/T "STENA VICTORY"
43 PRIVATE AND CONFIDENTIAL
All negotiations and fixture to be kept strictly private and confidential
by all parties and shall not be reported except for certain mandatory
reporting required.
44 CARGOES
Dirty petroleum products and clean petroleum products.
45 TRADING RANGE
World-wide trading always afloat, always within British Institute Warranty
Limits, as may be revised from time to time, or within the limits applying
in Owners' insurances in effect from time to time, however excluding any
war zones, embargoed countries and any other areas to which restrictions
may be imposed by the United Nations or the flag state. The Charterers may
be allowed to breach the trading limits as described above subject to the
Charterers paying any extra insurance premium supported by vouchers from
Owners' underwriters.
46 REDELIVERY
Charterers to provide 15 and 10 days notice of redelivery area, and 5/3/2/1
day(s) definite notice of redelivery and place.
47 BASIC HIRE
The Charterers shall pay for the use of the vessel in accordance with the
terms of this charter party a daily rate in US Dollars ($) (the "Basic
Hire"), which shall be payable monthly in advance, as per the following
schedule:
Year Basic Hire
1 $35,700
2 $36,075
3 $36,469
2
4 $36,882
5 $37,316
Option year 1 $37,772
Option year 2 $38,251
Option year 3 $38,753
48 ADDITIONAL HIRE
(A) Payment of Additional Hire
In addition to payment of Basic Hire hereunder, the Charterers shall
pay to the Owners Additional Hire (as defined below), if any,
quarterly in arrears, on each Additional Hire Payment Date as
hereinafter provided. As used herein, "Additional Hire Payment Date"
means the 25th day of the first month of each calendar quarter
commencing on the first full calendar quarter after the Delivery Date
(as described in Clause 5), except that the last Additional Hire
Payment Date shall be the 25th day following the Expiry Date (as
described in Clauses 4 and 49), provided that if such date is not a
Business Day (as defined below), the Additional Hire Payment Date
shall be the next succeeding Business Day. As used herein, a "Business
Day" means a day (other than a Saturday or Sunday) on which banks are
open for business in New York City, Gothenburg and London.
No Additional Hire shall be payable in respect of any periods during
which the vessel is off-hire pursuant to Clauses 21 or 83, except that
in the event any class condition or recommendation determined by the
vessel's classification society during the inspection of the vessel
undertaken by the Owners in connection with the purchase of the vessel
(so long as such inspection shall be completed no later than 90 days
following the delivery of the vessels), Additional Hire shall be
payable for any off-hire periods resulting from the repair of such
condition or recommendation unless such repairs can be completed
during a regularly scheduled drydocking without increasing the
duration of such drydocking.
(B) Calculation of Additional Hire
During the term in effect on the date hereof of the time charter by
the Charterers to Sun International Limited ("Sun International"), an
indirect wholly-owned subsidiary of Sunoco, Inc.
3
(the "Sun Charter"), the "Additional Hire" payable for any calendar
quarter shall be equal to the time charter hire paid by Sun
International to the Charterers under the Sun Charter during such
calendar quarter after deduction of (i) the Basic Hire in effect for
such calendar quarter, (ii) ship broker commissions payable by the
Charterers in an amount not to exceed 2.5 percent of the time charter
hire received by the Charterers under the Sun Charter during such
calendar quarter and (iii) commercial management fees payable by the
Charterers in an amount not to exceed 1.25 percent of the time charter
hire received by the Charterers under the Sun Charter during such
calendar quarter, subject to adjustment as provided in paragraphs (C)
and (D) below, except that in the event the vessel is off-hire as a
result of any class condition or recommendation determined by the
vessel's classification society and Additional Hire is payable
pursuant to paragraph (A) above, the Additional Hire payable for such
off-hire period shall be calculated based on the amount of time
charter hire that would have been payable by Sun International to the
Charterers under the Sun Charter had the vessel not been off-hire
after giving effect to the deductions set forth in clauses (i), (ii)
and (iii) above.
For any period following the expiration of the term of the Sun Charter
in effect on the date hereof, the "Additional Hire" payable for any
calendar quarter shall be equal to an amount calculated as fifty
percent (50%) of the Weighted Average Hire for the quarter after
deduction of the Basic Hire in effect for that quarter, subject to
adjustment as provided in paragraphs (C) and (D) below. As used
herein, the "Weighted Average Hire" for any calendar quarter shall be
an amount equal to the Average Daily Rate for such calendar quarter
multiplied by the number of days in such calendar quarter (excluding
any days in such calendar quarter during which Additional Hire is not
payable as provided in paragraph (A) above). As used herein, the
"Average Daily Rate" shall be a daily rate equal to the weighted
average of the following amounts:
(1) A weighted average of the time charter hire per day received by
the Charterers for any periods during the Calculation Period (as
defined below) that the vessel is subchartered by the Charterers
under a time charter after deduction of (i) ship broker
commissions payable by the Charterers in an amount not to exceed
2.5 percent of the time charter hire received by the Charterers
during the Calculation Period and (iii) commercial management
fees payable by the Charterers in an amount not to exceed 1.25
percent of the time charter hire received by the Charterers
during the Calculation Period; and
(2) The Time Charter Equivalent Hire (as described below) for any
periods during the Calculation Period that the vessel is not
subchartered by the Charterer under a time charter.
For purposes of calculating the Average Daily Rate, the amounts set
forth in (1) and (2) above shall be weighted based on the number of
days the vessel was subchartered by the Charterers under a time
charter during the
4
Calculation Period and the number of days the vessel was not
subchartered by the Charterers under a time charter during the
Calculation Period.
If at any time the Weighted Average Hire calculated for any calendar
quarter (or portion thereof), is equal to or less than the Basic Hire
in effect for that quarter, the Additional Hire will be zero.
As used herein, the "Calculation Period" shall be the twelve month
period ending on the last day of each calendar quarter, except that in
the case of the first three full calendar quarters following the
Delivery Date, the Calculation Period will be the three, six and nine
month periods, respectively, ending on the last day of such calendar
quarter and shall include in the case of the first calendar quarter
the period from the Delivery Date to the commencement of the first
full calendar quarter.
As used herein, "Time Charter Equivalent Hire" shall mean (i) the
weighted average of the Daily Value (as defined below) for the
following notional round voyage routes applying the weight set forth
opposite each route:
West-Africa to LOOP--50%
Middle East Gulf to LOOP--50%
or (ii) the weighted average of the Alternative Daily Value for the
Alternative Routes applying the Alternative Weights (each as defined
below), as applicable, in each plus an additional amount per day equal
to 10% of such weighted average.
On the last day of each calendar quarter (or on the next Business Day
if such day is not a Business Day) and on the Expiry Date, the Owners
and the Charterers shall instruct the Association of Shipbrokers and
Agents Tanker Broker Panel or, exceptionally, another panel of brokers
mutually acceptable to the Owners and the Charterers (the "Brokers
Panel") to determine the average spot rates (the "Average Spot Rates")
in Worldscale points over any periods during the Calculation Period
that the vessel is not subchartered by the Charterers under a time
charter. The Owners shall instruct the Brokers Panel to determine the
Average Spot Rates on the following standard notional round voyage
routes and cargo sizes for vessels of the same type as the vessel and
to deliver its determination in writing to the Owners and the
Charterers by not later than the fifth Business Day following the date
of the request by the Owners and the Charterers to make such
determination:
West-Africa to LOOP with 260,000 tonnes of crude
Middle East Gulf to LOOP with 265,000 tonnes of crude
5
In the exceptional case that the scheduled Brokers Panel meeting is
unexpectedly cancelled the assessment will be provided at the earliest
opportunity. The determination by the Brokers Panel of these Average
Spot Rates shall be binding upon both the Owners and the Charterers.
The Brokers Panel shall invoice the Owners and the Charterers for the
cost of the Brokers Panel assessment and of any experts engaged by the
Brokers Panel. The amounts invoiced by the Brokers Panel shall be
shared equally between the Owners and the Charterers.
On receipt of the Brokers Panel assessment, the Charterers will
calculate the Time Charter Equivalent Hire in accordance with the
following components and complete a calculation of the Weighted
Average Hire and the amount of Additional Hire, if any, which will be
forwarded to the Owners not later than the fifth Business Day
following the date on which the Charterers receive the Average Spot
Rates from the Brokers Panel. The calculation shall indicate whether
there is Additional Hire due to the Owners or whether the calculation
results in a negative number.
To calculate the "Daily Value" the Average Spot Rates for:
West-Africa to LOOP with 260,000 tonnes of crude
Middle East Gulf to LOOP with 265,000 tonnes of crude
will be applied to the notional round voyage for the same route with
cargo and then back in ballast using the following parameters:
a. The Average Spot Rate, as supplied by the Brokers Panel, shall be
multiplied by the Worldscale Flat rate for each notional round
voyage route listed above as set forth in the New Worldwide
Tanker Nominal Freight Scale as issued by the Worldscale
Association and current for the period in question;
b. To calculate the freight income, the product of the calculation
set forth in (a) above shall be multiplied by the cargo size for
each notional round voyage route listed above;
c. To calculate the voyage income, bunker costs (equal to the
bunkers used multiplied by the bunkers prices), port charges,
ship broker commissions and commercial management fees, all as
determined below, shall be deducted from the freight income
calculated in (b) above;
▇. ▇▇▇▇▇▇▇ used shall be determined by speed, distance and
consumption of bunkers at sea and in port;
6
e. Distance shall be as set forth in the "World-Wide Marine Distance
Tables" published by Veson Nautical Distance Tables;
f. Speed and consumption at sea shall be 16.9 knots at 127 tonnes
per day in laden condition and 17.7 knots at 127 tonnes per day
in ballast condition less a steaming allowance of 7.5 percent
applied to the speeds to allow for weather and navigation;
▇. ▇▇▇▇▇▇▇ in port shall be loading 12 tonnes per day, idling 3
tonnes per day and discharging 145 tonnes per day;
h. Time in port shall be 7.5 days, which shall be split 3 days
loading, 3 days discharging and the balance of the time idling;
i. Voyage duration for each notional round voyage route listed above
shall be calculated using distance as set forth in (e) above,
speed as set forth in (f) above and time in port as set forth in
(h) above;
▇. ▇▇▇▇▇▇ prices shall be the mean of the average prices prevailing
at Curacao and Fujairah during the quarter for Marine Fuel Oil
grade IFO 380 CST as published by Platts Bunkerwire, or another
publication mutually acceptable to the Owners and the Charterers
should Platts Bunkerwire become no longer available, plus
applicable barge delivery charges (equal to the average barge
delivery charges over the prior twelve-month period);
k. Port charges for loading and discharging ports shall be equal to
the published tariffs and exchange rates in effect on the last
calendar day of the quarter, and include all vessel costs for
port calls;
1. Ship brokers commissions and a commercial management fee
totalling 3.75 percent of the freight income shall be deducted
from the voyage income; and
m. The Daily Value for each notional round voyage route listed above
shall be calculated by dividing the voyage income by the voyage
duration.
If in the Charterers' reasonable opinion it becomes impractical or dangerous,
due to war, hostilities, warlike operations, civil war, civil commotion,
revolution or terrorism for VLCC vessels to operate on the notional voyages for
which the Average Spot Rates shall be determined, the Charterers may request the
Owners' agreement for the Daily Value to be substituted by an Alternative Daily
Value (an "Alternative Daily Value") for the period of such danger or
restriction of trading. Such request shall not be unreasonably refused by the
Owners. In such event, the Alternative Daily Value shall be calculated by the
Charterers using the parameters set forth above on the basis of the Average Spot
Rates using alternative notional
7
round voyage routes (the "Alternative Routes") and applying weights (the
"Alternative Weights") to the Alternative Routes that reasonably reflect
realistic alternative round voyages trade for VLCC vessels during the period of
such danger or restriction of trading.
The notional round voyage routes are intended to represent routes on which VLCC
vessels are typically used. If during the term of this Charter, in the
Charterers' reasonable opinion, these routes cease to be used by VLCC vessels,
or assumptions regarding bunkering ports contained herein cease to be
applicable, the Charterers may, with the Owners' consent, which shall not be
unreasonably withheld, instruct the Brokers Panel to substitute alternative
routes and bunkering ports (for purposes of determining bunker prices) that most
closely match the routes and bunkering ports typically used by VLCC vessels and
to apply appropriate weights to such routes.
If "Worldscale" ceases to be published, the Brokers Panel shall use its best
judgment in determining the nearest alternative method of assessing the market
rates on the specified voyages.
Calculation Illustrations
West-Africa to LOOP
Data used:
1) Average Spot Rate (determined by Brokers Panel) = W67.2
2) Worldscale Flat = $10.83
3) Cargo size = 260,000
4) Voyage duration = 38.02 days
5) Bunker price = $103.27 per tonne
6) Bunkers used = 4,222.04 tonnes
7) Port charges = $120,816
8) Calculation of freight income:
1) multiplied by 2) = 10.83 x 0.672 = $7.27;
$7.27 x 3) = $1,890,200
9) Calculation of voyage income:
Freight income $1,890,200
less:
2.50% broker commissions (47,255)
1.25% commercial management fees (23,627)
Bunker costs 5) x 6) (436,010)
Port charges 7) (120,816)
--------
(627,708)
Voyage income $1,262,492
8
10) Calculation of Daily Value
9) / 4) = $1,262,492 / 38.02 = $33,206
Middle East Gulf to LOOP
Data used:
1) Average Spot Rate (determined by Brokers Panel) = W67.2
2) Worldscale Flat = $21.64
3) Cargo size = 265,000
4) Voyage duration = 70.80 days
5) Bunker price = $103.27 per tonne
6) Bunkers used = 8,385.10 tonnes
7) Port charges = $42,000
8) Calculation of freight income:
1) multiplied by 2) = 21.64 x 0.672 = $14.54;
$14.54 x 3) = $3,853,651
9) Calculation of voyage income:
Freight income $3,853,651
less:
2.50% broker commissions (96,341)
1.25% commercial management fees (48,171)
Bunker costs 5) x 6) (865,929)
Port charges 7) (42,000)
-------
(1,052,441)
Voyage income $2,801,210
10) Calculation of Daily Value
9) / 4) = $2,801,210 / 70.80 = $39,565
Calculation of Time Charter Equivalent Hire
Daily Value West-Africa to LOOP x 50% $16,603
Daily Value Middle East Gulf to LOOP x 50% $19,783
-------
$36,386
10% V-MAX adjustment $3,689
Time Charter Equivalent Hire $40,025
(C) Adjustment for the first three calendar quarters
If Charterers have paid Additional Hire to the Owners for the first, second
or third calendar quarters following the Delivery Date (including in the
case of the first
9
calendar quarter the period from the Delivery Date to the commencement of
the first full calendar quarter), and such Additional Hire would have been
lower or zero had such Additional Hire been calculated using the Weighted
Average Hire determined over the twelve month period ending on the last day
of the fourth full calendar quarter following the Delivery Date, the
Charterers shall have the right to deduct from any Additional Hire otherwise
payable in respect of the fourth calendar quarter an amount equal to the
difference between (x) any Additional Hire paid in respect of the first,
second and third calendar quarters following the Delivery Date and (y) any
Additional Hire that would have been payable had such Additional Hire been
calculated using the Weighted Average Hire determined over the twelve month
period ending on the last day of the fourth full calendar quarter following
the Delivery Date (but taking into account the period from the Delivery Date
to the commencement of the first full calendar quarter), provided that in
the event such calculation results in a negative number, no adjustment will
be made to any Additional Hire payable in respect of the fourth quarter. If
no Additional Hire is due at the time of the calculation of such difference
or the difference is greater than the Additional Hire payable in respect of
the fourth calendar quarter, any difference not deducted from the Additional
Hire payable at such time may be deducted from future Additional Hire
payable to the Owners.
(D) Adjustment of Additional Hire
If, pursuant to Clause 48 of the Time Charter Party for M/T Stena Vision
entered into between Vision Ltd. and CM V-Max I Limited, a negative number
results at the end of a calendar quarter from the deduction of the Basic
Hire for such calendar quarter from the Weighted Average Hire for such
calendar quarter, then 50% of such negative amount may be deducted from the
Additional Hire, if any, payable by the Charterers in respect of the vessel
for such calendar quarter.
49 OPTIONS
Charterers shall have three one-year options to extend this Charter with
each such option to be declared by the Charterers in writing no less than
four months prior to the expiry of the charter period in effect at that
time.
50 IGS-COW-PUMPING
Charterers shall have the option to crude oil wash all parts of the
vessel's cargo tanks. Owners warrant that vessel is equipped with an Inert
Gas System and Crude Oil Washing System in good working order and the
Master, Officers and Crew are competent to operate said systems. If
requested by Charterers or as required by international or local
regulations, Owners agree to conduct crude oil washing of all cargo tanks
at discharge port(s) simultaneously with cargo discharge operations
10
and to Charterers' satisfaction. International or local regulations shall
prevail over Charterers' orders if conflict exists.
Owners warrant that the vessel can discharge her entire cargo in maximum 24
hours or maintain 100 p.s.i. at ship's manifold provided shore facilities
permit, excluding crude oil washing time and stripping.
The vessel shall be equipped with pressure gauges at each discharge
manifold, which will be maintained in a proper working condition, and each
gauge shall have a valid test certificate.
51 ELIGIBILITY CLAUSE
Owners warrant that the vessel is in all respects eligible under applicable
laws and regulations for trading to the ports and places specified in under
this charter party and that at all times she shall have on board all
certificates, records and other documents required for such service.
Furthermore, it is incumbent upon the Owners, unless the Charterers
determine otherwise, to make every effort to obtain the following vetting
approvals/acceptance: ChevronTexaco, Shell, Navion, BP, ExxonMobil,
TotalFinaElf, Repsol.
In addition Owners will make best efforts to obtain , at Charterers' cost,
other approvals/ acceptances that may be required by Charterers during the
duration of this time charter contract. Once the above
approvals/acceptances have been obtained, Owners will ensure that such
approvals/acceptances will be maintained throughout the duration of the
time charter.
52 P & I INSURANCE COST LIABILITY
(A) Owners warrant that, throughout the entire period of this Charter
Party, Owners shall have full and valid protection and indemnity
insurance ("P & I Insurance") for the vessel, as described in
sub-paragraph (B) of this Clause, with P & I Insurance placed with a P
& I Club which is a member of the International Group of P & I Clubs.
The P & I Insurance and excess insurance shall be at no cost to
Charterers; except that Charterers shall reimburse Owners for one
hundred (100) per cent of any documented net surcharges properly due
and paid by Owners under the P & I Insurance and/or under the
additional insurance for U.S. voyages or is employed in any trade area
deemed by the Owners' P & I Club to be within the Federal or State
jurisdiction of the United States of America, and/or its executive
economic zone as defined under the United States Oil Pollution Act of
1990 directed under the Charter Party by Charterers, ("U.S. voyages")
provided, however, that any reimbursement obligation of Charterers
shall be conditioned upon Owners fully meeting the requirements of
Clause 3. Any request for
11
reimbursement by Owners under this Clause shall mean the surcharges,
as described above, paid by Owners after taking into consideration any
and all discounts and/or rebates received or receivable by the Owners
or to the Owners' credit under the P & I Insurance and/or additional
insurance.
(B) The P & I Insurance must include coverage against liability for cargo
loss/damage per incident and coverage against liability for pollution,
including ITOPF obligations, ("Pollution Liability") for an amount not
less than USD 1 billion per incident.
(C) If requested by Charterers, Owners shall promptly furnish to the
Charterers proper evidence of such P & I Insurance and excess
insurance immediately upon signing the Charter Party term. A breach by
the Owners of the above warranty shall entitle Charterers to obtain
such P&I Insurance and excess insurance at its own costs; provided,
however, that in such event Charterers shall be entitled to deduct the
costs of such insurances from the payment of hire pursuant to this
Charter.
(D) In any event Owners undertake to have always in place throughout the
entire period of this Charter Party the oil pollution coverage
required by the industry available through P & I Club, which is a
member of The International Group of P & I Clubs and/or first class
insurance company.
(E) To the extent possible the Charterers shall be co-insured under the
P&I Insurance
53 FINANCIAL RESPONSIBILITY IN RESPECT OF POLLUTION
If Charterers advise Owners that the vessel is to call at any port where
environmental legislation has been enacted that requires the procurement of
financial guarantees, special certificates or special permits, all related
costs payable per call related to compliance with such legislation
(including obtaining a Certificate of Financial Responsibility and other
requirements of the Oil Pollution Act of 1990, as amended from time to
time, with respect to any U.S. port) shall be paid by Charterers. Owners
shall supply any relevant documents to Charterers, and Charterers shall
have the benefit of any eventual discount on the above.
54 VESSEL'S CASUALTIES
The Owners shall cause the Master to inform Charterers immediately by
telefax or telex if any situation occurs which results, or is likely to
result in either delays, or damages to the vessel or machine systems,
including but not limited to, failure of inert gas system, cargo systems,
or delays from proceeding to assistance of other vessels, or in damages to
cargo, or in pollution, oil spill, and/or oil discharge.
12
55 LETTER OF INDEMNITY
If ▇▇▇▇ of Lading is not available at any discharge port or place to which
the vessel may be ordered by Charterers under this Charter or if Charterers
require Owners to deliver cargo to a party and/or at a port or place other
than set out in the Bills of Lading, then Owners shall nevertheless
discharge the cargo carried by the vessel in compliance with Charterers'
instructions, upon a consignee nominated by Charterers (hereinafter called
"the Receiver") presenting reasonable identification to the Master, in
consideration of the following undertakings by the Charterers:-
Then in each case, the vessel shall discharge the cargo as directed by the
Charterers in consideration of the following indemnity, which shall be
deemed to be given in each and every occasion:
(A) Charterers shall indemnify Owners and their servants or agents and
hold all of them harmless in respect of:
1. All liability loss or damage of whatsoever nature (including
legal costs as between attorney and solicitor and clients and
associated expenses) which Owners and their servants and agents
may sustain by reason of delivering cargo in accordance with
Charterers' request, or
2. Any liability in respect of loss or damage to cargo which Owners
and their servants and agents may incur by reason of a change in
destination to the extent that such liability exceeds the
liability that would have been incurred if the new destination
had been named as the original discharge port in the ▇▇▇▇ of
Lading.
(B) In the event of any proceeding being commenced against Owners and
their servants and agents, in connection with the delivery of the
goods as aforesaid, Charterers shall provide them from time to time
with sufficient funds to defend the said proceedings.
(C) If the vessel or any other vessel or property belonging to Owners
should be arrested or detained by reason of Owners complying with
Charterers' aforesaid request, Charterers shall provide such bail or
other security as may be required to secure the release of such vessel
or property and to indemnify Owners in respect of any loss, damage, or
expense caused by such arrest or detention whether or not the same is
justified.
(D) Owners shall promptly notify the Charterers:
13
1. If any person, other than a person to whom the Charterers ordered
the Owners to deliver or produce delivery of the cargo, claims to
be entitled to such cargo, or
2. If the vessel or any other property is arrested as a result of
any such discharge of cargo as aforesaid
(E) As soon as all original Bills of Lading shall have arrived and/or come
into the Charterers' possession, the Charterers shall deliver them to
the Owners or Owners' nominees duly endorsed whereupon the present
Charterers' liability shall cease.
(F) Charterers warrant that they are authorised by the party or parties
entitled to the cargo to direct the vessel to discharge the cargo as
aforesaid.
(G) This indemnity shall be governed by and construed in accordance with
United States Law, and all disputes, controversies or claims arising
out or in relation to this indemnity or the breach, termination or
invalidation thereof shall be decided by the United States District
Court for the Southern District of New York, and the Charterers
undertake to instruct New York solicitors to accept service of any
proceedings in respect of any dispute arising out of or in connection
with this indemnity when called upon to do so.
56 EXXON DRUG AND ALCOHOL POLICY CLAUSE
Owners warrant that they have a policy on Drug and Alcohol Abuse ("Policy")
applicable to the vessel, which meets or exceeds the standards in the Oil
Companies International Marine Forum Guidelines for the Control of Drugs
and Alcohol Onboard Ships. Under the Policy, alcohol impairment shall be
defined as a blood alcohol content of 40-mg/100 ml or grater; the
appropriate seafarers to be tested shall be all vessel Officers and the
drug/alcohol testing and screening shall include random or unannounced
testing in addition to routine medical examinations. An object of the
Policy should be that the frequency of the random/unannounced testing to be
adequate to act as an effective abuse deterrent, and that all Officers be
tested at least once a year through a combined program of
random/unannounced testing and routine medical examinations.
Owners further warrant that the Policy will remain in effect during the
term of this Charter and that Owners shall exercise due diligence to ensure
that the Policy is complied with. It is understood that an actual
impairment or any test finding of impairment shall not in and of itself
mean the Owners have failed to exercise due diligence.
14
57 SOLAS CLAUSE
The vessel has a valid SOLAS Safety Equipment and SOLAS Construction
Certificates.
58 TELEFAX/TELEX CLAUSE
The vessel has a telefax and a telex machine on board, which Owners shall
maintain in good working order throughout the entire period of this Charter
Party.
59 ISPS CLAUSE
(a)
(i) From the date of coming into force of the International Code for the
Security of Ships and of Port Facilities and the relevant amendments
to chapter XI of SOLAS (ISPS Code) in relation to the vessel and
thereafter during the currency of this Charter, the Owners shall
procure that both the vessel and "the Company" (as defined by the
ISPS Code) shall comply with the requirements of the ISPS Code
relating to the vessel and "the Company". Upon request the Owners
shall provide a copy of the relevant International Ship Security
Certificate (or the Interim International Ship Security Certificate)
to the Charterers. The Owners shall provide the Charterers with the
full style contact details of the Company Security Officer (CSO).
(ii) Except as otherwise provided in this Charter, loss, damage, expense
or delay, excluding consequential loss, caused by failure on the
part of the Owners or "the Company" to comply with the requirements
of the ISPS Code or this Clause shall be for the Owners' account.
(b)
(i) The Charterers shall provide the CSO and the Ship Security Officer
(SSO)/Master with their full style contact details and, where
sub-letting is permitted under the terms of this Charter, shall
ensure that the contact details of all sub-charterers are likewise
provided to the CSO and the SSO/Master. Furthermore, the Charterers
shall ensure that all sub-charter parties they enter into during the
period of this Charter Party contain the following Provision:
"The Charterers shall provide the Owners with their full style
contact details and, where sub-letting is permitted under the terms
of the charter party, shall ensure that the contact details of all
sub-charterers are likewise provided to the Owners".
15
(ii) Except otherwise provided in this Charter, loss damage, expense or
delay, excluding consequential loss, caused by failure on the part
of the Charterers to comply with this Clause shall be for the
Charterers' account.
(c)
Notwithstanding anything else contained in this Charter all delay costs or
expenses whatsoever arising out of or related to security regulations or
measures required by the port facility or any relevant authority in
accordance with the ISPS Code including, but not limited to, security
guards, launch services, tug escorts, port security fees or taxes or
expenses, shall be for the Charterers' account unless such costs or
expenses result solely from the Owners' negligence. All measures required
by the Owners to comply with the Ship Security Plan shall be for the
Owners' account.
(d)
If either party makes any payment which is for the other party's account
according to this Clause, the other party shall immediately indemnify the
paying party.
60. AUTOMATED MANIFEST SYSTEM (AMS) CLAUSE
U.S. customs clearance - if cargo is to be discharged in a U.S. port or
territory subject to control by the U.S. Customs and Border Protection
("CBP"), Charterers warrant that all necessary details required by CBP for
clearance of the cargo, inclusive of but not limited to, shipper consignee
and notify party full name, address and phone number or telex number, will
be included on each ▇▇▇▇ of Lading or alternatively supplied to Owners in
writing a minimum of 24 hours prior to vessel's arrival at the first
designated U.S. port of discharge. For voyages less than 24 hours in
duration this information must be included on the ▇▇▇▇ of Lading or advised
to Owners prior to vessel departure from the loading place or port. Any
delays, fines or penalties incurred due to Charterers' failure to comply
with the above will be for Charterers' account.
Effective 4 March 2004, all imported cargoes into the U.S. must be
electronically reported via the Bureau of U.S. customs and border
protection AMS system. This requires the carrier to have a type 3
international carriers bond as well as a Standard Carriers Alpha Code
("SCAC"). It is the responsibility of the carrier to ensure that this
reporting requirement occurs 24 hours prior to vessel's arrival at the
first U.S. port. Should the international voyage be less than 24 hours in
duration, the carrier shall electronically file the manifest via the
automated
16
manifest system at the time of loading in the foreign port. Owners and/or
vessel master or their designated agent will provide a copy of the
electronically filed manifest to the Charterers or their designated agent
at the time of filing with CBP.
Owners warrant that it is aware of the requirements of the U.S. customs and
border protection regulation issued on 5 December 2003 under federal
register Part II Department of Homeland security 19 CFR Parts 4, 103 et al.
and will comply fully with these requirements for entering U.S. ports. Any
delays, fines or penalties incurred due to Owners' failure to comply with
the above will be for Owners' account.
61 DERRICKS
The vessel shall be equipped, throughout the entire period of this Charter
Party with minimum of 1x15 ton derricks.
62 I T O P F
Owners warrant that vessel is a member of the International Tanker Owners
Pollution Federation (ITOPF), and that Owners will retain such membership
during the entire period of this contract. Owners further warrant that the
vessel shall, during the period under this contract, be in full compliance
with 1969 Civil Liability Convention (CLC) and the 1971 Fund Convention.
63 OIL SPILL PREVENTION AND RESPONSE
Should Charterers determine that Owners do not have a suitable or adequate
Oil Spill Response Contingency Plan that provides directly or through
membership or contract with an oil spill response contractor or
organisation all necessary equipment or personnel to prevent, ▇▇▇▇▇,
contain and remove pollution, Charterers shall notify Owners concerning any
such deficiencies. Owners shall promptly rectify such deficiencies at
Owners' cost and expense.
64 INSURANCE PROVISION
Upon request by Charterers, Owners will provide documentary evidence of
insurance. Further, Owners shall give a minimum of ten (10) days notice to
Charterers in the event that liability cover is to be lowered or withdrawn.
65 SPILL RESPONSE CONTINGENCY PLAN
Owners warrant they have an "Oil Spill Response Contingency Plan" and that
they will provide Charterers a copy prior to commencement of this Charter
including phone numbers of key Owners contacts. Owners further warrant that
during this
17
Charter Party and any extension thereof that this plan will comply with all
U.S. Federal and U.S. Coast Guard Requirements.
66 COMPLIANCE CLAUSE
Owners warrant that the vessel shall, during the period of this Charter,
comply with all applicable international conventions, all applicable Laws,
regulations and/or other requirements of the country of the vessel registry
and of the countries of the port(s) and/or place(s) to which the vessel may
be ordered hereunder and all applicable regulations and/or requirements of
any terminals or facilities in such port(s) or place(s) where the vessel
shall load or discharge. Owners further warrant that the vessel shall have
on board, during subject period, all certificates, records or other
documents required by the aforesaid conventions, laws, regulations and/or
requirements. The conventions, laws, regulations and requirements referred
to in this paragraph include the conventions, laws, regulations and
requirements concerning ship size, ship design, safety, operation of ship
equipment (including inert gas and crude oil wash system if the vessel is
so equipped), navigation, pollution and other like matters.
67 U.S. COAST GUARD REGULATION CLAUSE
Owners certify that the vessel will be in full compliance with all known
and future applicable United States Coast Guard Regulations including
Pollution Prevention Regulations as specifically described as 33 CFA parts
154, 155 and 156 or will hold necessary waivers if not in compliance. Any
delay as a result of non-compliance will count as time off hire. If and for
as long as the vessel will not be traded to the U.S., Charterers may
relieve the Owners from any obligation under this clause.
68 ARCO CAST IRON CLAUSE
Owners warrant that all riser valves and fittings, outboard of the last
fixed rigid support to the vessel's deck, that are used in the transfer of
cargo or ballast, will be made of steel or nodular iron and that only one
steel reducer or spacer will be used between the vessel's valve and the
loading arm. The fixed rigid support must be designed to prevent both
lateral and vertical movement of the transfer manifold.
69 SHIP-TO SHIP LIGHTERAGE CLAUSE
Charterers have the option to load and/or discharge and/or lighten the
vessel via ship-to-ship transfer in accordance with the procedure set out
in "OCIMF'S Ship-to-Ship Transfer Guide", always to the Master's
satisfaction.
18
If ship-to-ship transfer is required this is subject to the Master's
approval. In this event Charterers shall provide a sheltered area for
conduct of ship-to-ship transfer operation. Any extra insurance costs,
which may be placed on the vessel and/or cargo as a result of such
ship-to-ship transfer operation, shall be for Charterers' account.
Charterers are to provide and pay for adequate fenders, moorings, hoses and
equipment necessary to perform the ship-to-ship transfer operations, all of
which shall be to the Master's satisfaction.
Such ship-to-ship transfer operation shall always be carried out in
conformity, with the provisions of the "OCIMF Ship-to-Ship Transfer Guide",
but ship-to-ship transfer operations shall always be at the Master's
discretion and if the Master at any time considers that ship-to-ship
transfer operations are or should become unsafe and have to be interrupted,
the vessel shall not be considered as off hire.
Charterers shall notify Owners of such ship-to-ship transfer operations and
give Owners sufficient notice to arrange additional insurance cover for
ship-to-ship transfer purpose.
Full or partial discharge into lighters/barges shall not be considered to
be ship-to-ship transfer.
70 MOORING AND HOSE CLAUSE
Owners shall, unless otherwise notified by Charterers or their agent,
supply at Owners' expense all hands, equipment and facilities required on
board the mooring and unmooring and connecting and disconnecting hoses for
loading and discharging.
71 SPEED AND CONSUMPTION FIGURES
In addition to Clause 24 (a) speed and consumption:
Laden/Ballast Fuel Oil 380 CST:
Speed Consumption laden Consumption ballast
----- ----------------- -------------------
16.9 knots 127 tons per day -
17.7 knots - 127 tons per day
From the above mentioned speeds there shall be deducted a steaming
allowance of 7.5 per cent to allow for weather and navigation.
Idle in port or stand by: 3 tons per day
Loading: 12 tons per day
19
Pumping at full capacity: 145 tons per day
Performing COW: 12 tons per day
72 CLEANING CLAUSE
Cleaning of cargo tanks to be performed by the vessel's crew in accordance
with Charterers' cleaning instructions, which always to be compatible with
coating type/resistance list and the vessel's tanks, lines, gaskets, pumps
and coils.
Charterers supply cleaning chemicals if required due to cargoes carried.
73 DETENTION CLAUSE
Should the vessel be seized or detained by any authority or arrested at the
suit of any party having or purporting to have a claim against any interest
in the vessel incurred by the actual Owners, hire shall not be payable in
respect of any period during which the vessel is not at Charterers' use and
all extra expenses shall be for Owners' account, unless such seizure or
detention is occasioned by any personal act or omission or default of
Charterers or their agents, or by reason of the cargo carried.
74 SMUGGLING CLAUSE
Any delays, expenses and/or fines incurred on the account of smuggling to
be for Owners' account if caused by the Master, Officers, Crew or Owners'
servants.
75 HOUSE FLAG/CHARTERERS' MARKINGS
Charterers have the privilege of flying their house flag, to paint funnel,
bow crest in their house colours and to paint their marks on ship's sides
and put/change name of vessel. On or prior to vessel's redelivery
Charterers shall remove their marks on ships sides and repaint ship's name
and funnel in accordance with Owners' request. Cost of such paintings
and/or repainting and/or changing name for Charterers' account unless
otherwise agreed with Master/Owners. Upon Charterers' request crew to
perform the work and payment to be settled direct between Charterers and
Master.
76 ENGLISH LANGUAGE CLAUSE
The vessel will be manned with Master and Officers able to communicate both
verbally and in written English ensuring smooth communication with
Charterers, their agents and shore personnel of suppliers and receivers.
20
77 ITF CLAUSE
The Owners guarantee that the officers and crew on board are employed under
terms and conditions approved by ITF head office competent for the country
of the vessel's flag during the whole Charter period.
In the event the vessel being subject to boycott by ITF or any other body,
being delayed or rendered in-operative by strikes, labour stoppages or any
other difficulties arising from the vessel's flag, ownership, crew or terms
of employment of other crew of the same ownership, operation or control,
such time lost is to be considered as off-hire and all expenses incurred
thereby, including fuel consumed during such period; to be for Owners'
account.
78 HEATING CLAUSE
The vessel to be able throughout the terms of this Charter to maintain the
cargo temperature up to a maximum of 57.5 degrees Celsius (135 degrees
Fahrenheit) and if loaded below to increase it by 4 degrees Celsius per
day.
79 VACCINATION CERTIFICATES
The Owners/Managers to arrange at their time and expense that the Master,
Officers and Crew of the vessel hold valid vaccination certificates.
80 REMEASURE CLAUSE
Charterers have the option to re-measure the vessel for the purpose of
satisfying certain port/terminal regulations. All cost and time to be for
Charterers' account. The vessel to be redelivered non-measured at Owners'
option if Charterers exercised their option to re-measure in first place.
81 EXXON MOORING
Owners warrant that vessel's mooring lines and wires shall comply fully
with any one of three of Exxon Mooring Criteria during the Charter Party
period. Charterers, subject to Owners' prior consent, to supplement lines
and mooring wires, load/or discharge pipes/equipment if required at Owners'
expense.
82 STORAGE CLAUSE
Charterers shall have the option of requesting the vessel to remain idle,
at a safe place, at anchor/or drifting.
21
83 BREACH OF WARRANTY CLAUSE
If Owners are in breach of any of their representations and warranties,
Charterers may so notify Owners in writing, and following the receipt by
Owners of any such notice that Owners failed to exercise due diligence as
required by their representations and warranties, the vessel shall be
off-hire and no further payments shall be due until Owners have so
demonstrated that they are exercising such due diligence.
84 INSPECTION CLAUSE
Owners agree to allow Charterers or their designated representative access
to the vessel on demand at any time during the term of the Charter Party,
for the purposes of carrying out a full and detailed inspection into every
aspect of the vessel's operation and maintenance. If as a result of such
inspection the vessel is determined to be operating or maintained to a
lesser standard than that existing at the time of delivery of the vessel to
Charterers at the commencement of this Charter (the `'Delivery Standard")
then Charterers may place the vessel off-hire until such time as the Owners
return the vessel to the Delivery Standard as determined by Charterers. The
vessel shall remain on-hire for 48 (forty-eight) hours after notice placing
the vessel off-hire is given to allow Owners to review all deficiencies and
to provide Charterers with an action plan.
In enforcing this clause Charterers is to make allowances for fair wear and
tear of the vessel.
85 ON-HIRE SURVEY
Owners/Charterers agree to hold a joint on-hire survey (physical
conditions) at last discharge port prior delivery or first load port after
delivery. Cost of said survey to be shared equally between
Owners/Charterers. Same applies for redelivery.
86 ISM
Owners warrant that at all time during the performance of this charter the
vessel shall strictly adhere to and conform to the requirements of the ISM
Code and shall be in possession of a valid Safety Management Certificate
(SMC). Owners further warrant that at all times during the performance of
this charter the Owners or the Managers shall comply with the provisions of
the ISM Code and be in possession of a Document of Compliance (DOC).
87 CHANGE OF OWNERSHIP CLAUSE
Owners warrant that for the duration of this Charter (i) the Owners shall
remain the sole owners of the vessel and Arlington Tankers Ltd. shall
remain the direct
22
legal and beneficial owner of the Owners, (ii) there will be no change in
the technical management of the vessel other than changes pursuant to
Section 3 of the Agreement, dated the date hereof between Stena AB and the
Owners, and (iii) there will be no change in the flag or registry of the
vessel.
88 MULTIGRADE CARGOES
Owners warrant that the vessel shall always load/discharge cargo at the
maximum possible rate consistent with the safe operation of the vessel.
Additionally the vessel shall be capable of loading a full cargo within a
maximum period of 24 hours (or prorated for part cargoes). Where more than
one grade is to be loaded/discharged such grades shall be loaded/discharged
concurrently, whilst maintaining two valve segregation between grades,
provided the vessel is physically capable of doing so. Any additional time
used owing to the inability of the vessel to load/discharge in accordance
with the above shall be considered as time off hire.
89 ONBOARD BLENDING CLAUSE
Charterers shall have the right to perform onboard blending of cargo whilst
loading, being two or more grades, over the designated cargo tanks to be
loaded. Vessel's staff shall ensure that proper stability maintained during
the entire operation. Charterers' nominated cargo inspector will always
supervise such onboard blending and vessel's staff is to follow the
inspector's recommendations. Charterers will issue L.O.I. in Owners' P&I
Club wording.
90 TRACKING SYSTEM CLAUSE
It is agreed that Charterers may from the time of fixing until completion
of the charter period employ an Inmarsat tracking system on the vessel.
Such tracking system works on data provided from the vessel's onboard
Inmarsat C system and can be installed simply, either remotely, or on some
older systems with minimal set up input from the vessel.
All registration/communication costs relating to this tracking system will
be for Charterers' account. Charterers will advise when the system is
operative and confirm termination on completion of charter.
91 ▇▇▇.▇▇▇ CLAUSE
Owners to provide, free of charge, a copy of the OCIMF VPQ in the required
electronic form so that the vessel can be included in Charterers'
subscription to the website "▇▇▇.▇▇▇". Owners are furthermore required to
update the system with
23
vessel approval status, certification and any other information as required
on a regular basis.
92 GREEN AWARD CLAUSE
Rebates in port dues etc. obtained via the Green award certificate to be
refunded to Charterers, provided that Charterers have paid for the Green
Award audit fees in full, or prorated for the period covered under this
charter party.
93 SALE OF THE VESSEL
The Owners shall have no right to sell the vessel during term of this
Charter or any extension thereof without the Charterers' prior written
consent, whose consent may be withheld at the Charterers' sole discretion.
For the purpose of this Clause 93, any sale, assignment, transfer,
conveyance or disposition of the shares of the Owners, directly or
indirectly through intermediate holding companies, by their sole
shareholder Arlington Tankers, Inc. to any third party not controlled by
Arlington Tankers, Inc. shall be deemed a sale of the vessel. This clause
93 shall not prohibit in any way the mortgaging or hypothecation of the
vessel to a financial institution pursuant to a financing transaction
related to the purchase of the vessel by the Owners.
94 CHANGES/IMPROVEMENTS NECESSARY FOR THE OPERATION OF THE VESSEL OR IMPOSED
BY LEGISLATION OR CLASS
(A) In the event any improvement, structural change or the installation of
new equipment is imposed by compulsory legislation and/or class rules,
Charterers shall have the right to require that the Owners effect such
improvement, changes or installations. The Charterers shall fully
reimburse the Owners for the total cost of all such improvements,
structural changes or installations up to USD100,000 in any calendar
year. To the extent that the total cost of all such improvements,
structural changes or installations exceed USD100,000 in any calendar
year, the Charterers shall reimburse the Owners in an amount equal to
the product of (i) the cost of such improvements, structural changes
or installations and (ii) a fraction, the numerator of which shall be
the number of whole months remaining in the charter period at the time
of completion of such improvement, structural change or installation
(the "Remaining Charter Period") and the denominator of which shall be
the number of whole months remaining in the depreciation period of the
vessel (calculated as 25 years from the year the vessel was built) at
the time of completion of such improvement, structural change or
installation (such product, the "Reimbursement Payment") and the
balance of the cost of such improvement, structural change or
installation shall be paid by the Owners. If the Charterers have made
a payment to the Owners pursuant to the preceding sentence and
following such payment the charter period is extended as a result of
the exercise by the
24
Charterers of their option rights under Clause 49 hereof, the
Charterers shall pay additional compensation to the Owners in an
amount equal to the difference between the Reimbursement Payment paid
by the Charterers and the amount that would have been paid by the
Charterers had the Remaining Charter Period used to calculate the
Reimbursement Payment included the number of whole months in the
extension period.
(B) In any event any improvement, structural change or the installation of
new equipment, not falling under (A) above, is deemed necessary by the
Charterers for the continued operation of the vessel, Charterers shall
have the right at their own cost to effect such improvement,
structural changes or installation, with the Owners' consent which
shall not unreasonably be withheld.
(C) The Owners have to be notified in writing in advance by the Charterers
about any changes and/or improvements as afore mentioned.
(D) Any change, improvement or installation made pursuant to this Clause
shall be the property of Owners.
95 THIRD PARTY CLAUSE
Except as may be otherwise agreed in writing by the parties with any third
party, a person who is not party to this Agreement/Charter may not enforce,
or otherwise have the benefit of, any provision of this Agreement/Charter
under the Contract (Rights of third Parties Act 1999), but this provision
does not affect any right or remedy of a third party which exists or is
available apart from the Act.
96 NEW CLAUSE PARAMOUNT
The Charterers warrant to include following clauses in all Bills of Lading
issued pursuant to this time Charter by them or any subcharterer:
(i) Subject to sub-clauses (2) or (3) hereof, this ▇▇▇▇ of Lading shall
be governed by, and have effect subject to, the rules contained in
the International convention for the Unification of Certain Rules
relating to Bills of Lading signed at Brussels on 25th August 1924
(hereafter the "Hague Rules") as amended by the Protocol signed at
Brussels on 23rd February 1968 (hereafter the "Hague-Visby Rules").
Nothing contained herein shall be deemed to be either a surrender by
the carrier of any rights or immunities or any increase of any of
his responsibilities or liabilities under the Hague-Visby Rules.
25
(ii) If there is governing legislation which applies the Hague-Visby
Rules compulsory to this ▇▇▇▇ of Lading, to the exclusion of the
Hague-Visby Rules, then this ▇▇▇▇ of Lading shall have effect
subject to the Hague Rules. Nothing herein contained shall be deemed
to be either a surrender by the carrier of any of his rights or
immunities or an increase of any of his responsibilities or
liabilities under the Hague Rules.
(iii) If there is governing legislation which applies the Hamburg Rules
compulsory to this ▇▇▇▇ of Lading to the exclusion of the
Hague-Visby Rules, then this ▇▇▇▇ of Lading shall have effect
subject to the Hamburg Rules. Nothing herein contained shall be
deemed to be either a surrender by the carrier of any of his rights
or immunities or an increase of any of his responsibilities or
liabilities under the Hamburg Rules.
(iv) If any term of this ▇▇▇▇ of Lading is repugnant to the Hague-Visby
Rules, the Hague Rules or the Hamburg Rules, as applicable, such
term shall be void to that extent but no further.
97 ARBITRATION
Any dispute arising under this charter shall be referred to the arbitration
in London in accordance with the provisions of the Arbitration ▇▇▇ ▇▇▇▇, or
any statutory modification or re-enactment thereof for the time being in
force save to the extent necessary to give effect to this provisions of
this Clause. The arbitration shall be conducted in accordance with the
London Maritime Arbitration Association (LMAA) terms current at the time
when the arbitration proceedings are commenced.
The reference shall be to three arbitrators; one to be appointed by each of
the parties hereto, and the third to be appointed by the two so chosen;
their decision or that of any two of them shall be final. A party wishing
to refer a dispute to arbitration shall appoint its arbitrator and send
notice of such appointment in writing to the other party requiring the
other party to appoint its own arbitrator within 14 calendar days of that
notice and stating that it will appoint its arbitrator as sole arbitrator
unless the other party appoints its own arbitrator and gives notice that it
has done so within the 14 days specified. If the other party does not
appoint its own arbitrator and give notice that it has done so within the
14 days specified the party referring a dispute to arbitration may, without
the requirement of any further prior notice to the other party, appoint its
arbitrator as sole arbitrator and shall advise the other party accordingly.
The award of a sole arbitrator shall be binding on both parties as if he
had been appointed by agreement.
26
Nothing herein shall prevent the parties agreeing in writing to vary these
provisions to provide for the appointment of a sole arbitrator.
In case where neither the claim nor any counterclaim exceeds the sum of
USD50,000 (or such other sum as the parties may agree) the arbitration
shall be conducted in accordance with the LMAA Small Claim Procedure
current at the time when the arbitration proceedings are commenced.
98 NO ASSIGNMENT BY CHARTERERS
Notwithstanding any other provisions of this Charter, the Charterers may
not assign any of their rights and obligations under this Charter without
the prior written consent of the Owners.
99 OPTIONAL TERMINATION
In the event the vessel is not delivered under this Charter by December 1,
2004, both the Owners and the Charterers shall have the right to terminate
this Charter and neither the Owners or the Charterers shall be entitled to
damages or to any other compensation or reimbursement of expenses.
100 OPTIONAL TERMINATION BY OWNERS
Upon the expiration of the Sun Charter, if Sun International does not
extend the Sun Charter with the Charterers at a daily rate of time charter
hire at least equal to the Basic Hire, the Owners shall have the right to
terminate this Charter upon notice in writing to the Charterers no less
than 60 days prior to the date of such termination, which right shall be
exercisable by the Owners at any time until one year following the
expiration of the Sun Charter; provided, however, that the Owners shall not
have such right to terminate this Charter if the Charterers have (A)
entered into a new time charter in respect of the vessel for the remainder
of the charter period under this Charter with a company (or its subsidiary)
having a credit rating of "BBB" or higher from Standard & Poor's Rating
Services or "Baa2" or higher from ▇▇▇▇▇'▇ Investors Service, Inc. at a
daily rate of time charter hire at least equal to the Basic Hire or (B)
provided cash collateral to the Owners initially in an amount equal to
$7.5 million and decreasing quarterly thereafter pro rata, as security for
the Charterers' payment obligations under this Charter.