Confidential    Execution Version
 
Dated: October 27, 2016
 
NICOLE NAVIGATION S.A.
(as Owner)
and
BULK NORDIC FIVE LTD.
(as Charterer)
BAREBOAT CHARTER PARTY
in respect of
One (1) 59,000DWT Ice Class Ultramax bulk carrier
named m.v. BULK DESTINY

NORTON ROSE FULBRIGHT

 

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Contents
Clause        Page

1 Definitions and Interpretation    1
2 Leasing    16
3 Conditions Precedent    17
4 Delivery and Acceptance    17
5 Exclusion of Warranties    18
6 Charterhire and Fees    20
7 Tax    21
8 Increased Costs    23
9 Other Indemnities    24
10 Payments    26
11 Representations    28
12 Information Undertakings    33
13 General Undertakings    36
14 Vessel Undertakings    41
15 Documents    48
16 Ownership and Registration    48
17 Insurances    48
18 Risk of Loss; Total Loss    54
19 Sale and Purchase of the Vessel    55
20 Termination Events    57
21 Assignment    63
22 Confidentiality    63
23 Calculations and Certificates    63
24 Partial Invalidity    64
25 Remedies and Waivers    64
26 Notices    64
27 Counterparts    65
28 Time of the Essence    65

 

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Contents
Clause        Page

29 Governing Law and Jurisdiction    65
30 Survival    66
31 Contracts (Rights of Third Parties Act) 1999    66
Schedule 1 Condition Precedent Documents67
Schedule 2 Form of Acceptance Certificate71
Schedule 3 Fixed Charterhire Payment Table72
Schedule 4 Compulsory Insurances74

THIS BAREBOAT CHARTER PARTY (this Charter) is dated October 27, 2016 and is made
BETWEEN:
(1)
NICOLE NAVIGATION S.A., a company incorporated under the laws of Panama with its
registered address at Paseo del Mar and Pacific Avenues, Costa del Este, MMG
Tower, 23rd Floor, Panama City, Republic of Panama , as owner (the Owner); and

(2)
BULK NORDIC FIVE LTD., an exempted company incorporated under the laws of
Bermuda, with its company number 48423 having its registered office at 3rd
Floor, Par la Ville Place, 14 Par la Ville Road, Hamilton HM08, Bermuda, as
charterer (the Charterer).

BACKGROUND:
(A)
Pursuant to the Purchase Agreement (as defined below) to be entered into on or
about the date of this Charter, the Owner has agreed to purchase and the
Charterer has agreed to sell the Vessel (as defined below) pursuant to the terms
of that agreement.

(B)
In order to finance its acquisition of the Vessel and in reliance on the
Charterer fulfilling its obligations under the Charterer Documents, the Owner
has entered into the Loan Agreement (as defined below).

(C)
The Owner and the Charterer have agreed that the Owner shall let to the
Charterer, and the Charterer shall take the Vessel on bareboat charter from the
Delivery Date (as defined below), subject to the terms and conditions set out
below.

NOW IT IS AGREED:

 

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1
Definitions and Interpretation

1.1
Definitions

In this Charter, the following terms have the meanings given to them in this
clause 1.1.
Accelerated Charterhire Amount means the amount calculated as being the
aggregate of:
(a)
the Purchase Obligation Price;

(b)
any outstanding amount of Charterhire Principal that has not been repaid as
Fixed Charterhire (but not for the avoidance of doubt double counting any
Charterhire Principal included in the Purchase Obligation Price);

(c)
any accrued but unpaid Variable Charterhire which falls due for payment by the
Charterer up to and including the Acceleration Payment Date, provided however if
such Acceleration Payment Date is not a Payment Date then the Charterer shall
pay to the Owner a portion of the instalment of such Variable Charterhire which
would otherwise be payable in respect of the period to the next following
Payment Date multiplied by a fraction of which the numerator is the number of
days from and including the first day of the current Variable Charterhire Period
to but excluding the Acceleration Payment Date and the denominator is the number
of days in that Variable Charterhire Period, including the first day but
excluding the last day; and

(d)
any liability of the Owner or the Lender for any breakage costs (if any
prepayment is made on a date other than the relevant Payment Date) or prepayment
premia, determined in good faith by the Owner or the Lender including without
limitation under article 5.03 of the Loan Agreement or incurred by the Owner in
connection with any prepayment by the Owner of the Loan

Acceleration Payment Date means the date for payment of the Accelerated
Charterhire Amount under clause 20.24 (Acceleration, Termination and
Repossession)
Acceptance Certificate means an acceptance certificate substantially in the form
of Schedule 2 (Form of Acceptance Certificate)
Administration Fee means an annual fee of twenty thousand U.S. Dollars
(US$20,000) payable by the Charterer in accordance with clause 6.5
(Administration Fee).
Affiliate means, in relation to any person, a Subsidiary of that person or a
Holding Company of that person or any other Subsidiary of that Holding Company
Antisocial Acts means any of the following acts:
(a)
violent demand;

(b)
unreasonable demand beyond the limit permissible under the applicable laws and
regulations;

(c)
threatening words and deeds or violence in relation with a transaction with the
Lender;

(d)
injury to the reputation of the Lender or interference with their business by
spreading a rumour, or using a fraudulent means or unlawful influence; or

(e)
any act similar to any of the above

Antisocial Forces means:

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(a)
an organized crime group;

(b)
a member of any organized crime group;

(c)
an ex-member of any organized crime group who left the group less than five (5)
years ago;

(d)
a quasi-member of any organized crime group;

(e)
an entity affiliated with any organized crime group;

(f)
a corporate racketeer;

(g)
a blackmailer pretending to be a social movement activist;

(h)
an organized crime group specialized in intellectual crime;

(i)
any entity or individual similar to any of above item (a) through item (h);

(j)
a person who is deemed to be controlled by a person who falls under any of above
item (a) through item (i) (any such person, a "Member or Affiliate of a Criminal
Group");

(k)
a person whose management is deemed to be substantially involved with a Member
or Affiliate of a Criminal Group;

(l)
a person who is deemed to utilize a Member or Affiliate of a Criminal Group in
order to pursue unlawful interests for itself or any third party or to inflict
damage upon any third party;

(m)
a person who is deemed to provide funding or other support to a Member or
Affiliate of a Criminal Group; or

(n)
an officer or other person substantially engaged in the management of the
business of the Charterer who has a socially unacceptable relationship with a
Member or Affiliate of a Criminal Group

and in this definition the term "organized crime group" (boryokudan) means a
group (including a member of an affiliate of such group) which is likely to
encourage collective or chronic violent unlawful acts, etc.
Approved Valuer means Clarkson Research Services Limited, Drewry Shipping
Consultants Ltd., Fearnley Consultants, Howe Robinson Marine Evaluations Ltd. or
other brokers/valuers acceptable to the Owner
Balloon Payment means, the sum of eleven million and two hundred thousand U.S.
Dollars (US$11,200,000) payable on the seventh (7th) anniversary of the Delivery
Date
Bill of Sale means the bill of sale in respect of the Vessel pursuant to the
Purchase Agreement, executed by the Charterer in favour of the Owner
Bribery means:
(a)
an act of any person intentionally to offer, promise, or give any undue
pecuniary or other advantage, whether directly or through intermediaries, to any
Public Official, for such Public Official or for a third party, in order that
such Public Official act or refrain from acting in relation to the performance
of official duties (including, any use of such Public Official's position,
whether or not within such Public Official's authorised competence) in order to
obtain or retain business or other improper advantage in the conduct of
international business; and/or

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(b)
an act of any person to receive from or to pay to any other person (or enter
into any agreement whereunder the same may or will at any time thereafter be
received from or paid to any person) any commission, bribe, pay-off, kickback,
pecuniary or other advantage with respect to the actual or potential award of a
contract or other business.

Builder means Oshima Shipbuilding Co., Ltd. a company incorporated under the
laws of Japan with its registered address at 1605-1, Oshima-cho, Saikai-shi,
Nagasaki-ken, 857-2494, Japan
BFB means Bulk Fleet Bermuda Holding Company Limited, an exempt company
incorporated under the laws of Bermuda with company number 43689 and with its
registered address at 3rd Floor, Par la Ville Place, 14 Par la Ville Road,
Hamilton HM08, Bermuda
Bulk Partners means Bulk Partners (Bermuda) Ltd., an exempt company incorporated
under the laws of Bermuda with its registered address at 3rd Floor, Par la Ville
Place, 14 Par la Ville Road, Hamilton HM08, Bermuda
Bulk Partners Holding means Bulk Partners Bermuda Holding Company Ltd., an
exempt company incorporated under the laws of Bermuda with its registered
address at 3rd Floor, Par la Ville Place, 14 Par la Ville Road, Hamilton HM08,
Bermuda
Business Day means a day on which banks and other financial institutions are
open for foreign exchange business in New York, Tokyo and London
Charter Period means the period commencing on the Delivery Date and expiring on
the earlier of the (a) date falling seven (7) years after the Delivery Date and
the (b) date when all amounts owing by the Charterer to the Owner under the
Charter are irrevocably paid in full, unless otherwise terminated in accordance
with the terms hereof
Charterer Documents means:
(a)
this Charter;

(b)
the Quiet Enjoyment Letter;

(c)
the Purchase Agreement;

(d)
the Security Documents to which an Obligor is a party;

(e)
the Fee Letter; and

(f)
the Quadpartite Agreement;

(g)
any other document the Charterer and Owner agree in writing shall be a
"Charterer Document"

Charterer Security Assets means:
(a)
the rights of the Charterer under the Compulsory Insurances;

(b)
the rights of the Charterer in and to any Insurance Proceeds,

(c)
any other asset, property or rights the Charterer and the Owner agree in writing
shall be a "Charterer Security Asset"

Charterhire means, in respect of a Payment Date, the aggregate amount of the
Fixed Charterhire and the Variable Charterhire due and payable on such Payment
Date in accordance with clause 6.1 (Scheduled Payments), and any Supplemental
Hire payable on demand in accordance with clause 6.2 (Supplemental Hire)

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Charterhire Principal means the amount borrowed by the Owner from the Lender
pursuant to the Loan Agreement and thereafter as the same may be reduced by
payments of Fixed Charterhire, any pre-payment in accordance with clause 6.3
(Prepayment of Charterhire) or otherwise adjusted in accordance with the terms
of this Charter as indicated in column B of Schedule 3 (Fixed Charterhire
Payment Table)
Classification Society means Nippon Kaiji Kyokai, DNV GL AS, Bureau Veritas or
any other member of the International Association of Classification Societies
acceptable to the Owner
Compulsory Acquisition means requisition for title or other compulsory
acquisition, requisition, appropriation, expropriation, nationalisation,
deprivation, forfeiture or confiscation for any reason of the Vessel by any
Government Entity or other competent authority, whether de jure or de facto, but
shall exclude requisition for use or hire not involving requisition of title
Compulsory Insurances means (a) any and all contracts and/or policies of
insurance required to be in place, taken out, effected and maintained by the
Charterer under this Charter, by or for the benefit of the Owner and/or the
Charterer (whether in the sole name of either of the Owner or the Charterer, or
in the joint names of the Owner and/or each Mortgagee and/or the Charterer
and/or the Manager or otherwise) in respect of the Vessel otherwise howsoever in
connection therein; and (b) all rights, benefits and proceeds relating to, or
deriving from, any of the foregoing, including claims of whatsoever nature and
return of premium
Contract of Construction and Sale means the agreement dated 2 December 2013
entered into between the Builder, Sumitomo and the Charterer in connection with
the delivery of the vessel and its sale to the Seller, as amended from time to
time, including but not limited to the Quadpartite Agreement;
Date of Total Loss means for the purpose of ascertaining the date of the Total
Loss:
(a)
an actual total loss of the Vessel shall be deemed to have occurred at noon
Greenwich Mean Time (GMT) on the actual date that the Vessel is lost or if the
date of the loss is unknown the date on which the Vessel was last reported;

(b)
a constructive total loss of the Vessel shall be deemed to have occurred at noon
GMT on the date that notice claiming such a total loss of the Vessel is given to
the insurers or, if the insurers do not admit the claim that a constructive
total loss has occurred, on the date on which a total loss is subsequently
admitted by the insurers or on the date which a final order or final award is
made by a competent court or arbitration tribunal that a constructive total loss
has occurred;

(c)
in the case of a compromised, agreed or arranged total loss of the Vessel on the
date upon which a binding agreement as to such compromised, agreed or arranged
total loss has been entered into by the insurers;

(d)
in the case of Compulsory Acquisition of the Vessel, on the date upon which the
relevant Compulsory Acquisition occurs;

(e)
in the case of confiscation, forfeiture, seizure, condemnation, arrest,
restraint or disappearance of the Vessel (other than by reason of Compulsory
Acquisition) thirty (30) days after the date upon which the relevant
confiscation, forfeiture, seizure, condemnation, arrest, restraint or
disappearance occurred;

(f)
in the case of hijacking, piracy, theft, capture or detention of the Vessel
(other than by reason of Compulsory Acquisition) sixty (60) days after the date
upon which the relevant hijacking, piracy, theft, capture or detention occurred;
and

(g)
in the case of a requisition for hire of the Vessel upon the expiry of ninety
(90) days (or such longer period as the Owner may agree) after the date upon
which the requisition occurred

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Default means any Termination Event or any event or circumstance specified in
clause 20 (Termination Events) which would (with the expiry of any grace period,
with the giving of any notice, the making of any determination or any
combination of the foregoing) constitute a Termination Event
Default Interest Rate means three (3) months LIBOR plus 4.75% per annum
calculated on a daily basis
Delivery means the delivery of the Vessel from the Owner to the Charterer under
this Charter, as evidenced by execution of the Acceptance Certificate
Delivery Date means the date on which Delivery occurs, which must be a Business
Day
Earnings means in respect of the Vessel, all amounts paid or payable to or for
the account of the Owner during the Charter Period and which arise out of the
ownership, use or operation of the Vessel, including (but not limited to):
(a)
all hire or other proceeds from any charter commitment or other contract entered
into by the Owner for the use or employment of the Vessel for any purpose; all
freight, hire and passage moneys;

(b)
compensation payable to the Owner or the Charterer in the event of requisition
for hire of the Vessel;

(c)
remuneration for salvage and towage services, demurrage and detention moneys and
damages for breach (or payments for variation or termination) of any
charterparty or other contract for the employment of the Vessel; and

(d)
if the Vessel is employed on terms whereby any such earnings aforesaid are
pooled or shared with any other person, that proportion of the net receipts of
the relevant pooling or sharing arrangement which is attributable to the Vessel

Environment means:
(a)
any land including, without limitation, surface land and sub-surface strata, sea
bed or river bed under any water (as referred to below) and any natural or
man-made structures;

(b)
water including, without limitation, coastal and inland waters, surface waters,
ground waters and water in drains and sewers; and

(c)
air including, without limitation, air within buildings and other natural or
man-made structures above or below ground

Environmental Approvals means any permit, licence, approval, ruling, variance,
exemption or other authorisation required under applicable Environmental Laws
Environmental Claim means any claim (other than any claims which are in the
opinion of the Owner frivolous or vexatious or which are discharged, stayed or
dismissed within twenty-one (21) days of its commencement) by any person or
persons or any governmental, judicial or regulatory authority which arises out
of any (or any allegation of) any breach, contravention or violation of
Environmental Law or of the existence of any liability or potential liability
arising from such breach, contravention or violation or the presence of
Hazardous Material or environmental damage and for this purpose claim means:
(a)
a claim for damages, compensation, fines, penalties or any other payment of any
kind whether or not similar to the foregoing;

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(b)
an order or direction to take, or not to take, certain action or to desist from
or suspend certain action; and

(c)
any form of enforcement or regulatory action

Environmental Incident means any actual spill, release or discharge of crude oil
and its products, any other polluting, toxic or hazardous substance and any
other substance (whose release into the environment is regulated or penalised by
Environmental Laws) into the environment from the Vessel in circumstances where:
(a)
the Vessel may be liable for Environmental Claims arising from such spill,
release or discharge as referred to above (other than Environmental Claims
arising and fully satisfied before the date of this Charter); and/or

(b)
the Vessel may be arrested or attached in connection with any such Environmental
Claim

Environmental Laws means any or all applicable law (whether civil, criminal or
administrative), common law, statute, statutory instrument, treaty, convention,
regulation, directive, by-law, demand, decree, ordinance, injunction,
resolution, order, judgment, rule, permit, licence or restriction (in each case
having the force of law) and codes of practice or conduct, circulars and
guidance notes having legal or judicial import or effect, in each case of any
government, quasi-government, supranational, federal, state or local government,
statutory or regulatory body, court, agency or association in any applicable
jurisdiction relating to or concerning:
(a)
pollution or contamination of the Environment, any ecological system or any
living organisms which inhabit the Environment or any ecological system;

(b)
the generation, manufacture, processing, distribution, use (including abuse),
treatment, storage, disposal, transport or handling of Hazardous Materials; and

(c)
the emission, leak, release, spill or discharge into the Environment of noise,
vibration, dust, fumes, gas, odours, smoke, steam effluvia, heat, light,
radiation (of any kind), infection, electricity or any Hazardous Material and
any matter or thing capable of constituting a nuisance or an actionable tort or
breach of statutory duty of any kind in respect of such matters,

including, without limitation, the following laws of the United States of
America: the Comprehensive Environmental Response, Compensation and Liability
Act of 1980, as amended, the Hazardous Materials Transportation Act, as amended,
the Oil Pollution Act of 1990, as amended, the Resource Conservation and
Recovery Act, as amended, and the Toxic Substances Control Act, as amended,
together, in each case, with the regulations promulgated and the guidance issued
pursuant thereto
Fair Market Value means the amount in U.S. Dollars being the average of the
appraisals obtained from two separate Approved Valuers in accordance with clause
12.4(m)
FATCA means:
(a)
sections 1471 to 1474 of the US Internal Revenue Code of 1986 or any associated
regulations or other official guidance;

(b)
any treaty, law, regulation or other official guidance enacted in any other
jurisdiction, or relating to an intergovernmental agreement between the US and
any other jurisdiction, which (in either case) facilitates the implementation of
any law or regulation referred to in paragraph (a) above; or

(c)
any agreement pursuant to the implementation of any treaty, law, regulation
referred to in paragraphs (a) or (b) above with the US Internal Revenue Service,
the US government or any governmental or taxation authority in any other
jurisdiction

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FATCA Deduction means a deduction or withholding from a payment under a
Transaction Finance Document required by FATCA
FATCA Exempt Party means a Party that is entitled to receive payments free from
any FATCA Deduction
Fee Letter means a fee letter in respect of the Upfront Fee and/or the
Administration Fee payable to the Owner by the Charterer and dated on or about
the date of this Charter
Finance Documents means the Loan Agreement and each or any swap agreement, the
Vessel Mortgage, assignment and other security documents that may be entered
into by the Owner in connection with its financing or refinancing of its
acquisition of the Vessel
Finance Party means the Lender and each other person notified in writing by the
Owner to the Charterer from time to time which finances or refinances the Vessel
(whether by equity, debt, payment sub-participation, or a combination thereof)
and includes each credit provider and any agent, security agent, swap provider
and arranger
Financial Indebtedness means any obligation (whether incurred as principal or
surety) for the payment or repayment of money, whether present or future, actual
or contingent, and for or in respect of:
(a)
amounts borrowed, including debit balances at banks or other financial
institutions;

(b)
any acceptance under any acceptance credit or bill discounting facility (or
dematerialised equivalent);

(c)
the amount of any deferred purchase price of property or services, the payment
of which has been deferred in excess of ninety (90) days;

(d)
all obligations under or in respect of guarantee, letters of credit or banker's
acceptances;

(e)
all obligations under or evidenced by bonds, debentures, notes or other similar
instruments;

(f)
any liability under any lease or hire purchase contract, which would in
accordance with GAAP be treated as a finance or capital lease;

(g)
amounts raised under any other transaction (including, without limitation, any
forward sale or purchase agreement) having the commercial effect of a borrowing;

(h)
receivables sold or discounted;

(i)
any derivative transaction protecting against or benefiting from fluctuations in
any rate or price (and, except for non-payment of an amount, the then mark to
market value of the derivative transaction will be used to calculate its
amount);

(j)
any counter-indemnity obligation in respect of any guarantee, indemnity, bond,
letter of credit or any other instrument issued by a bank or financial
institution; or

(k)
any guarantee, indemnity or similar assurance against financial loss of any
person in respect of any item referred to in the above paragraphs

Fixed Charterhire means the fixed charterhire component of each instalment of
Charterhire, as set out in column A of Schedule 3 (Fixed Charterhire Payment
Table), as the same may be adjusted in accordance with the terms of this Charter
or as otherwise agreed in writing between the Owner and the Charterer

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GAAP means generally accepted accounting principles, standards and practices in
the United States
Governmental Entity includes (whether having a distinct legal personality or
not) (a) any government or any governmental, semi-governmental or judicial
entity or authority, including any local or state government; and (b) any board,
commission, department, division, organ, instrumentality, court or agency of any
such entity, however constituted
Group Member means the Charterer, Pangaea, the Parent, Bulk Partners, Bulk
Partners Holding, BFB and any Affiliate of Pangaea that becomes a shareholder of
the Parent in place of STST
Hazardous Material means any element or substance, whether natural or
artificial, and whether consisting of gas, liquid, solid or vapour, whether on
its own or in any combination with any other element or substance, which is
listed, identified, defined or determined by any Environmental Law or other
applicable law to be, to have been, or to be capable of being or becoming
harmful to mankind or any living organism or damaging to the Environment,
including, without limitation, oil (as defined in the United States'
Comprehensive Environmental Response, Compensation and Liability Act of 1980, as
amended)
Holding Company means, in relation to a company or corporation, any other
company or corporation of which it is a Subsidiary
Indemnitee means each Interested Party, the Owner and each Finance Party and
their respective directors, officers, employees, servants, agents and
sub-contractors
Indirect Tax means any goods and services tax, consumption tax, sales tax, VAT
or other value added tax or any tax of a similar nature (however so described)
Insurance Proceeds means all proceeds of the Compulsory Insurances payable to or
received by the Charterer (whether by way of claims, returns of premiums, ex
gratia settlements or otherwise)
Interest Rate means three (3) month LIBOR plus 2.75% per annum
Interested Party means each person other than the Charterer with an ownership
interest (whether legal or equitable) or security interest in the Vessel and
includes, without limitation, the Owner and any mortgagee of the Vessel
ISM Code means the International Safety Management Code (including the
guidelines on its implementation), adopted by the International Maritime
Organisation Assembly as Resolutions A.741(18) and A.788 (19), as the same may
be amended or supplemented from time to time)
ISPS Code means the International Ship and Port Security Code of the
International Maritime Organisation and includes any amendments or extensions
thereto and any regulations issued pursuant thereto
Legal Reservations means:
(a)
the principle that equitable remedies may be granted or refused at the
discretion of a court and the limitation of enforcement by laws relating to
insolvency, reorganisation and other laws generally affecting the rights of
creditors;

(b)
the time barring of claims under the Limitation Act 1980 and the Foreign
Limitation Periods Act 1984, the possibility that an undertaking to assume
liability for, or indemnify a person against, non-payment of any stamp duty may
be void and defences of set-off or counterclaim; and

(c)
similar principles, rights and defences under the laws of any Relevant
Jurisdiction

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Lender means Sumitomo Mitsui Finance and Leasing Co., Ltd., and its respective
transferees, successors and assigns
LIBOR means, in respect of a sum:
(a)
the applicable Screen Rate; or

(b)
(if no Screen Rate is available for the interest period of that sum) the
shortest Screen Rate that is available but which is longer than the interest
period for such sum; or

(c)
if:

(i)
no Screen Rate is available for the currency of such sum; or

(ii)
no Screen Rate is available for the interest period of such sum and it is not
possible to calculate the shortest available Screen Rate specified in paragraph
(b) above for such sum,

the rate as supplied to the Owner at its request from Sumitomo Mitsui Banking
Corporation in the London interbank market,
as at 11.00 a.m. (London time) on the second (2nd) London Business Day prior to
the relevant Payment Date or such other date for U.S. Dollars and for a period
equal in length to the interest period of such sum, provided that if such rate
is minus, then the LIBOR shall be deemed to be zero for the purpose of
calculation of the Interest Rate
Loan means the principal amount of the borrowing under the Loan Agreement or the
principal amount from time to time outstanding of the borrowing under the Loan
Agreement
Loan Agreement means the facility agreement dated on or around the date of this
Charter and made between the Owner and the Lender pursuant to which the Lender
provided or will provide a loan facility to the Owner to assist with the
purchase of the Vessel pursuant to the Purchase Agreement
Major Casualty Amount means, in relation to the Vessel, the amount of one
million U.S. Dollars (US$1,000,000) or the equivalent in any other currency
Manager means such company as the Owner may from time to time approve in writing
(which approval shall not be unreasonably withheld) as the manager of the Vessel
Manager's Undertaking means an undertaking by any Manager of the Vessel to the
Owner in a form agreed by the Owner
Material Adverse Effect means a material adverse effect on:
(a)
the business, prospects, financial condition or operations of the relevant Group
Member;

(b)
the ability of any Obligor to perform its obligations under the Transaction
Documents;

(c)
the validity or enforceability of or the effectiveness or ranking of any
Security Interest granted or purported to be granted pursuant to, any
Transaction Document;

(d)
the validity, legality or enforceability of this Charter or the Pangaea
Guarantee or the rights or remedies of a Finance Party under any Transaction
Document; or

(e)
the purchase, ownership or operation of the Vessel by the Owner or Charterer

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Obligors means the Charterer, Pangaea and any other Group Member that is a party
to a Transaction Document, and Obligor means each or any of them, as the context
may require
Operation means the purchase, testing, design, manufacture, delivery,
non-delivery, late delivery, ownership, registration, import, use, export,
possession, control, operation, maintenance, servicing, repair, overhaul,
modification, replacement, refurbishment, removal, storage, de-registration,
redelivery and/or export of the Vessel
Original Financial Statements means the audited financial statements of the
Charterer (or, if audited financial statements are not produced, its unaudited
financial statements) for its financial year ended 31 December 2015 and the
audited consolidated financial statements of Pangaea for its financial year
ended 31 December 2015
Owner Encumbrance means any Security Interest created by the Owner
Pangaea means Pangaea Logistics Solutions Ltd., an exempted company incorporated
under the laws of Bermuda with company number 49020 and with its registered
address at 3rd Floor, Par la Ville Place, 14 Par la Ville Road, Hamilton HM08,
Bermuda
Pangaea Guarantee means the irrevocable and on demand guarantee dated on or
about the date of this Charter granted by Pangaea in favour of the Owner
guaranteeing all obligations owed by the Charterer to the Owner under the
Transaction Documents and in form and substance satisfactory to the Owner
Parent means Nordic Bulk Ventures Holding Company Ltd. an exempt company
incorporated under the laws of Bermuda with company number 48037 and with its
registered address at 3rd Floor, Par la Ville Place, 14 Par la Ville Road,
Hamilton HM08, Bermuda, the shareholders of which are BFB and STST
Party means a party to this Charter
Payment Date means, subject to clause 10.5 (Business Days),
(a)
for the first Payment Date, the date falling three (3) months from the Delivery
Date;

(b)
for subsequent Payment Dates, each of the dates falling at three (3) monthly
intervals thereafter; and

(c)
for the last Payment Date, the date falling on the seventh (7th) anniversary of
the Delivery Date

Permitted Indebtedness means in respect of the Financial Indebtedness of the
Charterer:
(a)
amounts owing by the Charterer under this Charter and the other Transaction
Documents;

(b)
amounts incurred by reason of this Charter or reasonable costs associated with
the day to day operation of the Vessel or otherwise in the ordinary course of
business of the Charterer;

(c)
amounts owing by the Charterer to a Group Member which are subordinated to
amounts payable under the Transaction Documents in a manner satisfactory to the
Owner; and

(d)
any other amounts that the Owner may agree in writing to be Permitted
Indebtedness (such consent not to be unreasonably withheld or delayed)

Permitted Maritime Liens means, in relation to the Vessel unless a Termination
Event has occurred and is continuing:

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(a)
any ship repairer's or outfitter's possessory lien in respect of the Vessel for
an amount not exceeding the Major Casualty Amount:

(b)
any lien on the Vessel for master's, officer's or crew's wages, and customary
Vessel operating expenses outstanding in the ordinary course of its trading and
which secure obligations not more than thirty (30) days overdue;

(c)
any lien on the Vessel for salvage; and

(d)
liens for Taxes or other government charges or levies not yet assessed or, if
assessed, not yet due and payable or being contested in good faith by
appropriate proceedings (and, if being so contested, for the payment of which
adequate reserves have been made or adequate insurances or an adequate bond has
been provided) so long as such proceedings do not involve any material risk of
the sale, seizure, detention, forfeiture or loss of the Vessel;

Permitted Security Interests means any:
(a)
Security Interests created by the Transaction Documents;

(b)
Permitted Maritime Liens; and

(c)
any other Security Interests created with the prior written consent of the Owner

Process Agent means (i) for the Charterer and Pangaea, MFB Solicitors, currently
of Fishmongers’ Chambers, 1 Fishmongers’ Hall Wharf, London EC4R 3AE , United
Kingdom, and (ii) for the Owner, Law Debenture Corporate Services Limited,
currently of Fifth Floor, 100 Wood Street, London EC2V 7EX, United Kingdom  

Prohibited Person means a person that is:
(a)
listed on, or owned or controlled by a person listed on, or acting on behalf of
a person listed on, any Sanctions List;

(b)
located in, incorporated under the laws of, or owned or (directly or indirectly)
controlled by, or acting on behalf of, a person located in or organised under
the laws of a country or territory that is the target of country-wide or
territory-wide Sanctions; or

(c)
otherwise a target of Sanctions

Protocol of Delivery and Acceptance means the protocol of delivery and
acceptance in respect of the Vessel executed by the Charterer and the Owner
pursuant to the Purchase Agreement
Public Official means any of:
(a)
any person holding a legislative, administrative, or judicial office of any
country (including, but not limited to, Bermuda, the Republic of Panama, the
United States and Japan), whether appointed or elected;

(b)
any person exercising a public function for any country (including, but not
limited to, the Bermuda, the Republic of Panama, the United States and Japan),
including for a public agency or public enterprises; and

(c)
any official or agent of a public international organisation

Purchase Agreement means the agreement dated on or about the date of this
Charter for the purchase of the Vessel between the Owner (as buyer) and the
Charterer (as seller)

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Purchase Obligation Price means the aggregate of an amount equal to the Balloon
Payment (as adjusted taking into account any prepayments made in accordance with
clause 6.3), any other amounts owing or due and payable to the Owner by the
Obligors under the Transaction Documents including fees, expense and costs
incurred by the Owner in effecting the sale and transfer of the Vessel to the
Charterer in accordance with clause 19 (Sale and Purchase of the Vessel)
Quadpartite Agreement means the agreement dated on or about the date of this
Charter entered into between the Builder, Sumitomo, the Charterer and the Owner
in connection with the delivery and the purchase of the Vessel by the Owner;
Quiet Enjoyment Letter means the quiet enjoyment letter dated on our about the
date of this Charter entered into between the Owner, Charterer and the Security
Agent
Relevant Jurisdiction means in relation to a person or entity:
(a)
its jurisdiction of incorporation;

(b)
any jurisdiction where any asset subject to or intended to be subject to the
Security Documents to be created is situated or registered;

(c)
any jurisdiction where it conducts its business; and

(d)
the jurisdiction whose laws govern the perfection of any of the Security
Documents

Reports means reports such as annual securities reports, semi-annual reports,
and other material financial reports prepared from time to time, if any
Required Insurance Amount at any time, means an amount in U.S. Dollars equal to
one hundred and twenty per cent. (120%) of the Loan
Requisition Compensation means all moneys and/or other compensation from time to
time payable or paid during the Charter Period in respect of the Compulsory
Acquisition of the Vessel
Sanctions means the economic sanctions laws, regulations, embargoes or
restrictive measures administered, enacted or enforced by any Sanctions
Authority (whether or not any Obligor is legally bound to comply with such laws,
regulations, embargoes or measures)
Sanctions Authority means any of:
(a)
the United States government; or

(b)
the United Nations; or

(c)
the United Kingdom; or

(d)
the European Union; or

(e)
Japan

and includes any government entity of any of the above, including, without
limitation, the Office of Foreign Assets Control of the US Department of
Treasury (OFAC), the United States Department of State, and Her Majesty's
Treasury (HMT)
Sanctions List means:
(a)
the "Specially Designated Nationals and Blocked Persons" list maintained by
OFAC;

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(b)
the Consolidated List of Financial Sanctions Targets and the Investment Ban List
maintained by HMT; or

(c)
any similar list maintained by, or public announcement of Sanctions designation
made by, any other Sanctions Authority

Screen Rate means the London interbank offered rate administered by ICE
Benchmark Administration Limited (or any other person which takes over the
administration of that rate) for U.S. Dollars and period displayed on pages
LIBOR01 or LIBOR02 of the Thomson Reuters screen (or any replacement Thomson
Reuters page which displays that rate) or on the appropriate page of such other
information service which publishes that rate from time to time in place of
Thomson Reuters. If the agreed page or service ceases to be available, the Owner
may, after consultation with the Charterer, specify another page or service
displaying the relevant rate
Security Assignment means the assignment dated on or around the same date of
this Charter in respect of, among other things, the Compulsory Insurances,
Insurance Proceeds and Requisition Compensation in connection with the Vessel
from the Charterer in such form as the Owner may require
Security Documents means each of the Pangaea Guarantee, Security Assignment, any
Manager's Undertaking, any Vessel Mortgage and any other document that may at
any time be executed by any person providing a guarantee or indemnity for or
creating, evidencing or perfecting any security to secure all or any part of the
liabilities owing under the Transaction Documents
Security Interest means any mortgage, charge (fixed or floating), pledge,
privilege, priority, lien, hypothecation, right of set-off, security trust,
assignment by way of security, reservation of title, any other security interest
or any other agreement or arrangement (including a sale and repurchase
arrangement) having the commercial effect of conferring security
State of Registration means Panama or such other jurisdiction as the Owner may
approve for registration of the Vessel
STST means ST Shipping and Transport Pte. Ltd., a company incorporated under the
laws of Singapore, with its registered address at 1 Temasek Avenue, No. 34-01,
Millenia Tower, Singapore 039192
Subsidiary means, in relation to any company or corporation, a company or
corporation:
(a)
which is controlled directly or indirectly, by the first mentioned company or
corporation;

(b)
more than half the issued share capital of which is beneficially owned, directly
or indirectly, by the first mentioned company or corporation; or

(c)
which is a Subsidiary of another Subsidiary of the first mentioned company or
corporation,

and for this purpose, a company or corporation shall be treated as being
controlled by another if that company or corporation is able to direct its
affairs and/or to control the composition of its board of directors or
equivalent body
Sumitomo means Sumitomo Corporation a company incorporated under the laws of
Japan with its registered office at Harumi Island Triton Square Office Tower Y,
8-11 Harumi 1-chome, Chuo-ku, Tokyo 104-8610 Japan
Supplemental Amount means:
(a)
liability of the Owner under any indemnities in the Finance Documents, including
without limitation under article 7A.01(4) of the Loan Agreement;

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(b)
any liability of the Owner or the Lender for any breakage costs or prepayment
premia, including without limitation under article 5.03 of the Loan Agreement or
incurred by the Owner or the Lender in connection with any prepayment by the
Charterer;

(c)
liability of the Owner for interest payments on principal under the Loan
Agreement, where such payments are not met out of Variable Charterhire; and

(d)
any other liability of the Owner for fees, costs and expenses (including without
limitation any swap costs, fund breakage fees, default interest (if due to
default of the Charterer), grossing up of payments, indemnities, increased or
additional costs, and transaction expenses, including with respect to the
appointment of process agents by the Owner) under the Finance Documents,

in each case, to the extent not otherwise compensated by the Charterer under the
other provisions of this Charter
Supplemental Hire means Charterhire payable for the use of the Vessel in
accordance with clause 6.2, each such amount being the amount as the Owner may
certify as being payable by it in respect of any Supplemental Amounts to any
person, such certificate to be conclusive and binding on the Charterer, in the
absence of manifest error
Tax means any present and/or future tax, levy, impost, duty or other charge or
withholding of a similar nature (including any penalty or interest payable in
connection with any failure to pay or any delay in paying any of the same) but
excludes Tax imposed on or calculated by reference the net income of the Owner
or other Finance Party (as relevant)
Tax Deduction means a deduction or withholding for or on account of Tax imposed
from a payment under a Transaction Document
Term means each period determined under this Charter by reference to which
Variable Charterhire or the relevant payment is calculated
Termination Event means each of the events specified in clause 20 (Termination
Events)
Total Loss means in relation to the Vessel, its:
(a)
actual or constructive or compromised or agreed or arranged total loss, as
applicable, including such loss as may arise during a requisition for hire; or

(b)
Compulsory Acquisition; or

(c)
confiscation, seizure, condemnation, arrest, restraint, or disappearance of the
Vessel, as applicable, (other than by reason of Compulsory Acquisition) which
deprives the Charterer of the use of the Vessel for a period in excess of thirty
(30) days from the relevant event occurring; or

(d)
any hijacking, piracy, theft, capture or detention of the Vessel, as applicable,
(other than by reason of Compulsory Acquisition) which deprives the Charterer or
any permitted charterer of the use of the Vessel, as applicable for a period in
excess of sixty (60) days from the relevant event occurring; or

(e)
any requisition for hire or use of the Vessel, as applicable, for more than
ninety (90)days (or such longer period as the Owner may agree)

Total Loss Payment Date means the date falling one hundred-twenty (120) days
from the Date of Total Loss
Transaction Documents means:

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(a)
the Charterer Documents, the Contract of Construction and Sale, the Bill of
Sale, the Protocol of Delivery and Acceptance, the Certificate of Acceptance any
Vessel Management Agreement and the Finance Documents;

(b)
all notices, amendments, addendums, acknowledgements, consents, certificates,
instruments, deeds, charges and other documents and/or agreements issued or
entered into or, as the case may be, to be issued or entered into pursuant to
any of the foregoing; and

(c)
any other document to be agreed by the Owner and the Charterer in writing as a
"Transaction Document"

Treasury Transaction means any derivative transaction entered into in connection
with protection against or benefit from fluctuation in any rate or price
Unpaid Sum means any sum due and payable but unpaid by the Charterer under the
Transaction Documents
Upfront Fee means the upfront fee payable in accordance with the Fee Letter
US$ or U.S. Dollars means the lawful currency from time to time of the United
States of America
Variable Charterhire means the variable component of each instalment of
Charterhire, being an amount equal to interest at the Interest Rate for the
relevant Variable Charterhire Period on the Charterhire Principal, such
components to be certified by the Owner to the Charterer
Variable Charterhire Period means each period for the calculation of Variable
Charterhire under this Charter, the first period commencing on the date the
Buyer makes the payments set out in clause 4.2 of the Purchase Agreement
pursuant to clause 6.2 therein and terminating on the next Payment Date and each
subsequent Variable Charterhire Period commencing forthwith upon the expiry of
the previous Variable Charterhire Period and expiring on the next following
Payment Date except that the last Variable Charterhire Period shall expire on
the last day of the Charter Period
Vessel means the 59,000 DWT Ice Class Ultramax bulk carrier named "Bulk Destiny"
bearing Hull Number 10762 which upon delivery to the Owner pursuant to the terms
and conditions of the Purchase Agreement, will be registered under the
Panamanian flag in the name of Owner as the legal owner under the laws and flag
of Panama
Vessel Management Agreement means, in relation to the Vessel, any agreement from
time to time being in force between the Charterer and the Manager with respect
to the management of the Vessel by the Manager and which has been approved by
the Owner in writing
Vessel Mortgage means, the first priority Panamanian law vessel mortgage granted
by the Owner in favour of the Lender in order to secure all sums payable by the
Owner to the Lender under the Loan Agreement.
1.2
Construction

(a)
Unless a contrary indication appears, any reference in this Charter to:

(i)
the Charterer, Finance Party, Indemnitee, Obligors, Owner and Party shall be
construed so as to include their respective successors in title, permitted
assigns and permitted transferees;

(ii)
consent includes an approval, authorisation, permission, exemption, filing,
licence, order, permit, recording and registration (and references to obtaining
consents are to be construed accordingly);

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(iii)
a cost includes any cost, charge, expense, fee, disbursement, remuneration or
other payment;

(iv)
a reference to determines or determined means a determination made in the
absolute discretion of the person making the determination;

(v)
indebtedness includes any obligation (whether incurred as principal or as
surety) for the payment or repayment of money, whether present or future, actual
or contingent;

(vi)
a liability includes, without limitation, any demand, claim, liability, action,
proceeding, penalty, fine, judgment, order or other sanction;

(vii)
month means a period starting on one day in a calendar month and ending on the
numerically corresponding day in the next calendar month and otherwise subject
to clause 10.5 (Business Days);

(viii)
a person includes any person, firm, company, corporation, government, state or
agency of a state or any association, trust or partnership (whether or not
having separate legal personality) or two or more of the foregoing;

(ix)
will will be construed to mean shall;

(x)
a provision of law is a reference to that provision as amended or re-enacted and
includes any regulations or rules issued under any such law; and

(xi)
a time of day is a reference to Tokyo time unless otherwise provided herein.

(b)
Section, clause and Schedule headings are for ease of reference only.

2
Leasing

2.1
Charter Term

Subject to the terms and conditions of this Charter, the Owner agrees to let,
and the Charterer agrees to lease, the Vessel for a period commencing on the
Delivery Date and expiring on the date falling seven (7) years after such date.
2.2
Charter by Demise

Throughout the Charter Period, the Charterer shall have the possession of the
Vessel and control of all matters relating to the navigation and operation of
the Vessel including employment of the master and crew. The master and crew of
the Vessel shall be the servants of the Charterer for all purposes whatsoever.
The Owner agrees that upon delivery the Vessel will be registered under the
Panamanian flag in the name of the Owner as the legal owner under the laws and
flag of Panama.

3
Conditions Precedent

3.1
Conditions Precedent (Charterers)

The Owner will not be obliged to deliver the Vessel to the Charterer under this
Charter unless on or before the Delivery Date, the Owner has received all of the
documents and other evidence listed in and complying with the requirements of
Schedule 1 (Condition Precedent Documents), together with all other documents
(including legal opinions) required by the Owner as conditions precedent
documents under the Purchase Agreement, each in form and substance reasonably
satisfactory to the Owner.
3.2
Further Conditions Precedent

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The Owner will not be obliged to deliver the Vessel to the Charterer under this
Charter if:
(a)
the Vessel has suffered a Total Loss; or

(b)
a Termination Event has occurred and is continuing or is reasonably expected to
occur as a consequence of Delivery taking place; or

(c)
any representation and/or warranty made by the Charterer under this Charter or
by Pangaea under the Pangaea Guarantee is, in the reasonable opinion of the
Owner, materially untrue or incorrect if made by reference to the facts and
circumstances existing on that date; or

(d)
any event or circumstance occurs which in the reasonable opinion of the Owner,
is likely to have Material Adverse Effect.

3.3
Waiver of Conditions Precedent

The conditions referred to in clause 3.1 (Conditions Precedent) and clause 3.2
(Further Conditions Precedent) are for the sole benefit of the Owner and may be
waived or deferred in whole or in part and with or without conditions by the
Owner.
3.4
Conditions Precedent (Owners)

The Charterer shall not be obliged to perform its obligations under the Charter
until the Charterer shall have received (a) certified copies (certified by an
officer or authorised signatory of the Owner) of (i) board resolutions or other
equivalent corporate authorisation documentation (including English translations
where applicable) relating to the power and authority of the Owner to enter into
the Transaction Documents and perform its obligations thereunder; (ii) any power
of attorney issued in connection with the execution and delivery of the
Transaction Documents; (iii) certified copies of the articles of association (or
equivalent) or other constitutional documents of the Owner; (iv) the
goodstanding certificate or incumbency certificate (as applicable) of the Owner
stating the name of its officers and directors; (b) the agreement of the Owner’s
appointed process agent for service of process in London to act in such
capacity, and that such appointment shall continue throughout the Charter
Period; and (c) confirmed in writing to the Owner that the documents in (a) and
(b) are satisfactory.

4
Delivery and Acceptance

4.1
Delivery Date

Subject to (a) the Owner having acquired title to the Vessel from the Charterer
under the Purchase Agreement and (b) the Owner and Charterer agreeing on a
delivery date hereunder, the Owner agrees to deliver the Vessel to the Charterer
in accordance with clause 4.3 (Delivery) of this Charter. The Owner will have no
responsibility to the Charterer or any other person for, or arising out of, any
delay or failure to effect Delivery or for any Total Loss or damage incurred on
or prior to Delivery.
4.2
Advance of Loan

The Charterer acknowledges that the Owner will be under no obligation to lease
the Vessel to the Charterer unless the Loan is made available to the Owner for
the purposes of financing its acquisition of the Vessel.
4.3
Delivery

(a)
Upon the execution of the Acceptance Certificate by the Charterer and the
countersignature thereof by the Owner, the Vessel will be deemed to have been
delivered by the Owner to and accepted by the Charterer under this Charter.
Without prejudice to the provisions of this clause 4, the Charterer acknowledges
that its execution and delivery of the Acceptance Certificate will constitute:

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(i)
irrevocable, final and conclusive acceptance of the Vessel for the purposes of
this Charter; and

(ii)
irrevocable, final and conclusive evidence that the Vessel is satisfactory in
all respects and complies with the requirements of this Charter and any other
Transaction Document, and is seaworthy, is in accordance with its
specifications, is in good working order and repair and without defect or
inherent or latent defect in title, condition, design, operation or fitness for
use, whether or not discoverable by the Charterer as of the Delivery Date, and
is free and clear of all liens, charges or Security Interests (save for the
Security Interests created pursuant to the Transaction Documents), and the
Charterer shall not be entitled to make or assert any claim against the Owner
with respect to the Vessel.

(b)
Following Delivery, the Vessel will be in every respect at the sole risk of the
Charterer, who will bear all risk of loss, theft, damage or destruction to the
Vessel from any cause whatsoever.

(c)
Once the Owner has accepted delivery of the Vessel under the Purchase Agreement,
the Charterer shall not be entitled to refuse to accept delivery of the Vessel
from the Owner under this Charter for any reason, including, but not limited to,
any defect or alleged defect in the Vessel.

5
Exclusion of Warranties

5.1
No responsibility for Vessel

The Charterer expressly acknowledges that:
(a)
the condition of the Vessel on delivery to the Charterer under this Charter is
the sole responsibility of the Charterer;

(b)
the Vessel is, or will upon Delivery be, satisfactory for the business of the
Charterer and any intended use of the Charterer;

(c)
the Owner has purchased the Vessel solely for the purpose of leasing the Vessel
to the Charterer under this Charter and the Owner enters into this Charter at
the request of, but not on behalf of, the Charterer; and

(d)
the Owner will have no responsibility whatsoever for any loss of profit
resulting directly or indirectly from any defect or alleged defect in the
Vessel.

5.2
As Is, Where Is and With All Faults

The Vessel leased under this Charter will be delivered "as is, where is, and
with all faults", and subject to each and every disclaimer set forth in this
clause 5, the Charterer agrees and acknowledges that the Owner and any Finance
Party will have no liability in relation to, and has not nor will be deemed to
have made or given, any conditions, warranties or representations, express or
implied, whether arising by law or otherwise with respect to the Vessel,
including but not limited to it being free of liens, Security Interests (save
for the Security Interests created pursuant to the Transaction Documents) or
defects (whether latent or apparent), the description, merchantability,
satisfactory quality, suitability, construction, seaworthiness, condition,
eligibility for any particular trade, operation, fitness for any use or purpose,
value, state, condition, appearance, safety, durability, design or operation of
any kind or nature of the Vessel or any part thereof or any obligation,
liability, right, claim or remedy in tort, whether or not arising from the
Owner's or any other party's negligence, actual or imputed, or any obligation,
liability, right, claim or remedy for loss of or damage to the Vessel, for any
liability of the Charterer to any third party, or for any other direct or
indirect, incidental or consequential damages. The Charterer hereby irrevocably
and unconditionally waives all its rights in respect of any condition, warranty
or representation, express or implied, on the part of the Owner and any Finance
Party and all claims against the Owner and any Finance Party howsoever and
whenever arising at any time in respect of or out of, in each case, the
condition, operation, sub-chartering or performance of the Vessel (including,
without limitation, the seaworthiness or otherwise of the Vessel).
5.3
The Charterer hereby waives, to the extent permitted by applicable law:

(a)
any and all rights which it may now have or which at any time hereafter may be
conferred upon it, by statute or otherwise, to terminate, cancel or quit this
Charter or to seek to return or surrender the Vessel hereunder except in
accordance with the express terms hereof; and

(b)
any rights which it may have in tort in respect of any of the matters referred
to in clause 5.2 and agrees that the Owner and any Finance Party shall have no
greater liability in tort in respect of any such matter than it would have in
contract after taking into account all the exclusions referred to in clause 5.2.

5.4
No third party making any representation or warranty relating to the Vessel or
any part of the Vessel is the agent of the Owner or any Finance Party nor has
any such third party authority to bind the Owner or any Finance Party.

5.5
Nothing contained in this Charter is intended to prejudice any rights of
warranty or other claims which the Charterer or the Owner may have against the
Builder, Sumitomo or any manufacturer, repairer or supplier of any part of the
Vessel or any other third party arising out of or in connection with the
Contract of Construction and Sale, Security Assignment and Quadpartite
Agreement. The Owner agrees to cooperate with the Charterer in bringing and
enforcing any claim of warranty or other such claims and the Charterer shall be
liable for any costs of the Owner incurred as a result of such cooperation.

5.6
If for any reason whatsoever this Charter shall be terminated in whole or in
part, by operation of law or otherwise, except as specifically provided herein,
unless a substitute charter is executed in form and substance acceptable to the
Owner, the Owner may demand (with no detriment to its other rights under this
Charter) and the Charterer will pay to the Owner an amount equal to the
Accelerated Charterhire Amount together with all other amounts incurred by it in
connection with the Vessel (including but not limited to any costs and expenses
incurred under the Transaction Documents) no later than fourteen 14 days after
such termination.

5.7
Charterer's Acknowledgment

The Charterer confirms that it is fully aware of the provisions of clause 5.2
(As Is, Where Is and With All Faults) and acknowledges that Charterhire and
other amounts have been calculated notwithstanding these provisions. The
Charterer agrees that the Owner shall be under no liability to supply any
replacement vessel or any piece or part thereof during any period when the
Vessel is unusable and unless caused by the Owner's gross negligence or wilful
default of its obligations under this Charter, shall not be liable to the
Charterer or any other person as a result of the Vessel being unusable.

6
Charterhire and Fees

6.1
Scheduled Payments

The Charterer shall pay to the Owner on each Payment Date an instalment of
Charterhire comprising (a) Fixed Charterhire, (b) Variable Charterhire for the
Variable Charterhire Period ending on such Payment Date in accordance with the
terms of this Charter.
6.2
Supplemental Hire

Where the Owner incurs any Supplemental Amounts at any time after the date of
this Charter during the Charter Period, the Charterer shall pay Supplemental
Hire to the Owner on demand in an amount equal to the applicable Supplemental
Amount.
6.3
Prepayment of Charterhire

(a)
Except as expressly provided otherwise in this Charter, the Charterer may not
prepay all or any part of the Charterhire without the prior written consent of
the Owner.

(b)
Upon giving not less than ten (10) Business Days' prior irrevocable notice in
writing to the Owner, the Charterer may, in lieu of its obligation to pay
relevant future instalments of Fixed Charterhire (or portions thereof) which
would, but for this clause 6.3, be payable by the Charterer to the Owner under
this Charter during the Charter Period, prepay all or any part of the Fixed
Charterhire and the Balloon Payment (but, if in part, in a minimum amount of
five hundred thousand U.S. Dollars (US$500,000) and integral multiples of five
hundred thousand U.S. Dollars (US$500,000)) on a Payment Date or on a date
otherwise agreed by the Owner, together with all accrued but unpaid Variable
Charterhire up to and including the date of such prepayment, any Prepayment Fee
as described in 6.3(c) below and all Supplemental Hire and any other amounts
then payable under the Charter in respect of the sum prepaid.

(c)
In respect of any amount to be prepaid a Prepayment Fee shall be payable as
follows:

(i)
for any prepayment made before the first anniversary of the Delivery Date, two
per cent (2%) of the amount to be prepaid;

(ii)
for any prepayment made on or after the first anniversary of the Delivery Date
up to and before the second anniversary of the Delivery Date, one per cent (1%)
of the amount to be prepaid; and

(iii)
for any prepayment made on or after the second anniversary of the Delivery Date
no Prepayment Fee shall arise.

(d)
Any and all partial prepayments made under this Charter in respect of Fixed
Charterhire shall be applied first to the Balloon Payment and then to the future
instalments of Fixed Charterhire hereunder, in inverse order.

(e)
Once the date for any prepayment has been fixed, such date shall be deemed as
the due date for such prepayment of Fixed Charterhire (and all associated
Variable Charterhire and Supplemental Hire) and should the Charterer fail to pay
any such sum due on such date the Charterer shall pay interest on such overdue
amounts in accordance with clause 10.7 (Default Interest).

6.4
Adjustment to Charterhire

(a)
The schedule of Fixed Charterhire set out in Schedule 3 (Fixed Charterhire
Payment Table) has been calculated prior to the execution of this Charter on the
basis of the assumptions that the Loan will be fully disbursed on or before
Delivery.

(b)
In the event that the assumptions referred to in paragraph (a) prove at any time
on or prior to the Delivery Date to be incorrect, or following any partial
prepayment of Charterhire on or after the Delivery Date pursuant to the terms
and conditions of this Charter, the Owner shall recalculate the Fixed
Charterhire accordingly and the Owner and the Charterer shall agree a substitute
Fixed Charterhire Payment Table to replace the one set out in Schedule 3 (Fixed
Charterhire Payment Table).

Each such replacement schedule shall be binding on the Owner and the Charterer,
in the absence of manifest error.
6.5
Administration Fee

The Charterer shall pay to the Owner on the date of this Charter, and thereafter
on each anniversary of the Delivery Date, the Administration Fee in accordance
with the terms of the Fee Letter.

7
Tax

7.1
Tax Gross-Up

(a)
All payments to be made by the Charterer under this Charter and the other
Transaction Documents to which the Charterer is a party will be made free and
clear of and without any Tax Deduction (save for FATCA Deduction) unless the
Charterer is required to make a Tax Deduction, in which case the sum payable by
the Charterer (in respect of which such Tax Deduction is required to be made)
will be increased to the extent necessary to ensure the Owner receives a sum net
of any deduction or withholding equal to the sum which it would have received
had no such Tax Deduction been made or required to be made.

(b)
The Charterer shall promptly upon becoming aware that it must make a Tax
Deduction (or that there is any change in the rate or the basis of a Tax
Deduction) notify the Owner accordingly.

(c)
If the Charterer is required to make a Tax Deduction (excluding for the
avoidance of doubt, any FATCA Deduction), then the Charterer will make that Tax
Deduction and any payment required in connection with that Tax Deduction within
the time allowed and in the minimum amount required by law.

(d)
Within thirty (30) days of making either a Tax Deduction or any payment required
in connection with that Tax Deduction, the Charterer shall deliver to the Owner
evidence reasonably satisfactory to the Owner that the Tax Deduction has been
made or (as applicable) any appropriate payment paid to the relevant taxing
authority.

7.2
Tax Indemnity

(a)
Without prejudice to clause 7.1 (Tax Gross-Up), if any Indemnitee is required to
make any payment of or on account of Tax (other than Tax imposed on or
calculated by reference to the net income of that Indemnitee) on or in relation
to any sum received or receivable by that Indemnitee under the Transaction
Documents (including any sum deemed for purposes of Tax to be received or
receivable by such Indemnitee whether or not actually received or receivable) or
if any liability in respect of any such payment is asserted, imposed, levied or
assessed against any Indemnitee, the Charterer shall on demand by the Owner,
promptly indemnify the Indemnitee which suffers a loss or liability as a result
against such payment or liability, together with any interest, penalties, costs
and expenses payable or incurred in connection therewith.

(b)
The Owner shall notify the Charterer of a claim under paragraph (a) as soon as
practicable with reasonable details that the Owner then have.

7.3
Operational Tax Indemnity

Without prejudice to clause 7.1 (Tax Gross-Up), the Charterer will pay, and will
on demand indemnify and hold each Indemnitee harmless against, any cost, loss or
liability with respect to any Taxes levied, assessed or imposed by any
Governmental Entity or any taxing authority thereof against the Charterer or the
relevant Indemnitee directly or indirectly relating to or attributable to (a)
the Vessel (unless such cost, loss or liability is attributable to the wilful
default, gross negligence or fraudulent act of the Owner or the relevant Finance
Party) or (b) any Operation conducted by the Charterer.
7.4
Stamp Taxes

The Charterer shall pay, and, on demand, indemnify each Indemnitee against any
cost, loss or liability that Indemnitee incurs in relation to stamp duty,
registration and other similar Taxes payable with respect to any Transaction
Document.
7.5
Indirect Tax

(a)
All consideration expressed to be payable under a Transaction Document by the
Charterer is deemed to be exclusive of any Indirect Tax. If any Indirect Tax is
chargeable on any supply made by an Indemnitee to the Charterer in connection
with a Transaction Document, then the Charterer will pay to the Indemnitee or to
its order (in addition to and at the same time as paying the consideration) an
amount equal to the amount of the Indirect Tax.

(b)
Where a Transaction Document requires the Charterer to reimburse an Indemnitee
for any cost or expense, the Charterer will also at the same time pay and
indemnify the Indemnitee against all properly evidenced Indirect Tax incurred by
the Indemnitee in respect of the relevant cost or expense to the extent the
Indemnitee reasonably determines that it is not able to reduce or avoid such
Indirect Tax or entitled to a credit or repayment in respect of the Indirect
Tax.

7.6
After Tax Basis

If any sum payable under any Transaction Document by way of indemnity or
reimbursement proves to be insufficient, by reason of the imposition of any Tax,
for the Indemnitee to discharge a corresponding liability to a third party or to
reimburse the Indemnitee for its costs and losses, then the Charterer will pay
the Indemnitee an additional amount so that (after taking into account any Tax
applied to that additional amount) the deficit is made up.
7.7
Information Regarding Taxes

(a)
The Charterer will as soon as practicable provide each Indemnitee with such
information as that Indemnitee may from time to time request to enable that
Indemnitee to file any return, report, statement or tax filing in connection
with the transactions contemplated by the Transaction Documents.

(b)
If the Charterer is required by any applicable law to deliver a report or return
in connection with any Taxes in respect of (or connected with) the transactions
contemplated by the Transaction Documents, then the Charterer will promptly
complete the report or return within the time permitted.

7.8
FATCA Information and FATCA Deduction

(a)
Subject to paragraph (c) below, each Party shall, within ten (10) Business Days
of a reasonable request by another Party:

(i)
confirm to that other Party whether it is:

(A)
a FATCA Exempt Party; or

(B)
not a FATCA Exempt Party; and

(ii)
supply to that other Party such forms, documentation and other information
relating to its status under FATCA (including its applicable "passthru payment
percentage" or other information required under the US Treasury Regulations or
other official guidance including intergovernmental agreements) as that other
Party reasonably requests for the purposes of that other Party's compliance with
FATCA;

(b)
If a Party confirms to another Party pursuant to 7.8(a)(i) above that it is a
FATCA Exempt Party and it subsequently becomes aware that it is not, or has
ceased to be a FATCA Exempt Party, that Party shall notify that other Party
reasonably promptly.

(c)
Paragraph (a) above shall not oblige any Finance Party to do anything which
would or might in its reasonable opinion constitute a breach of:

(i)
any law or regulation;

(ii)
any fiduciary duty; or

(iii)
any duty of confidentiality.

(d)
If a Party fails to confirm its status or to supply forms, documentation or
other information requested in accordance with paragraph (a) above (including,
for the avoidance of doubt, where paragraph (c) above applies), then:

(i)
if that Party failed to confirm whether it is (and/or remains) a FATCA Exempt
Party then such Party shall be treated for the purposes of the Finance Documents
as if it is not a FATCA Exempt Party; and

(ii)
if that Party failed to confirm its applicable "passthru payment percentage"
then such Party shall be treated for the purposes of the Finance Documents (and
payments made thereunder) as if its applicable "passthru payment percentage" is
100%,

until (in each case) such time as the Party in question provides the requested
confirmation, forms, documentation or other information.
(e)
Each Party may make any FATCA Deduction it is required to make by FATCA, and any
payment required in connection with that FATCA Deduction, and no Party shall be
required to increase any payment in respect of which it makes such a FATCA
Deduction or otherwise compensate the recipient of the payment for that FATCA
Deduction.

(f)
Each Party shall promptly, upon becoming aware that it must make a FATCA
Deduction (or that there is any change in the rate or the basis of such FATCA
Deduction) notify the Party to whom it is making the payment and, in addition,
shall notify the Owner.

8
Increased Costs

8.1
Increased Costs

(a)
The Charterer shall on demand by the Owner, pay for the account of the Owner and
any Finance Party the amount of any Increased Costs incurred by the Owner and/or
that Finance Party or any of its Affiliates as a result of (i) the introduction
of or any change in (or in the interpretation, administration or application of)
any law or regulation or (ii) compliance with any law or regulation made after
the date of this Charter. The terms "law" and "regulation" in this paragraph (a)
shall include, without limitation, any law or regulation concerning capital
adequacy, prudential limits, liquidity, reserve assets or Tax.

(b)
In this Charter "Increased Costs" means:

(i)
a reduction in the rate of return from the transactions contemplated by the
Finance Documents or the other Transaction Documents or on an Indemnitee's (or
its Affiliate's) overall capital (including, without limitation, as a result of
any reduction in the rate of return on capital brought about by more capital
being required to be allocated by such Indemnitee or one of its Affiliates);

(ii)
an additional or increased cost; or

(iii)
a reduction of any amount due and payable under any Finance Documents or any
other Transaction Document,

which is incurred or suffered by the Owner and any Finance Party or any of its
Affiliates to the extent that it is attributable to the Owner and/or that
Finance Party having agreed to finance or refinance the Vessel (whether by
equity, debt, payment sub-participation, or a combination thereof) or in
performing its obligations under this Charter (and including but not limited to
any Financial Indebtedness incurred or undertaken by the Owner in connection
with the acquisition and chartering of the Vessel), and provided the Owner
furnishes to the Charterer documentary support for the law or regulation
referred to in paragraph (a) above.
8.2
Increased Cost Claims

If a Finance Party intending to make a claim pursuant to clause 8 (Increased
Costs) notifies the Owner of the event giving rise to the claim, then the Owner
will promptly notify the Charterer.

9
Other Indemnities

9.1
Operational Indemnity

(a)
The Charterer shall on demand indemnify the Owner against any cost, loss,
liability, charges, expenses, fees, payments, penalties, fines, damages or other
sanction of a monetary nature suffered or incurred by the Owner (including from
third parties) as a result of or in connection with:

(i)
the performance of its obligations under this Charter and the other Transaction
Documents to which it is a party and

(ii)
the transactions contemplated thereby;

(iii)
any Operation conducted by, or with respect to, the Vessel;

(iv)
preventing or attempting to prevent the arrest, confiscation, seizure, taking in
execution, impounding, forfeiture or detention of the Vessel, or in securing or
attempting to secure the release of the Vessel;

(v)
the Total Loss of the Vessel;

(vi)
the occurrence of a Termination Event which is continuing;

(vii)
directly or indirectly in any manner, the design, manufacture, delivery,
non-delivery, purchase, importation, registration, ownership, chartering,
sub-chartering, possession, control, use, operation, condition, maintenance,
repair, replacement, refurbishment, modification, overhaul, insurance, sale or
other disposal, return or storage of or loss of or damage to the Vessel or
otherwise in connection with the Vessel (whether or not in the control or
possession of the Charterer) including but not limited to those losses described
in this clause 9 and including any and all claims in tort or in contract by an
sub-charterer of the Vessel from the Charterer or by the holders of any bills of
lading issued by the Charterer;

(viii)
directly or indirectly, any claims which may at any time be made on the ground
that any design, article or material of or in the Vessel or the operation or use
thereof constitutes or is alleged to constitute an infringement of patent or
copyright or registered design or other intellectual property right or any other
right whatsoever;

(ix)
the presence, escape, seepage, spillage, leaking, discharge or migration from
the Vessel of oil or any other hazardous substance, including without
limitation, any claims asserted or arising under the US Oil Pollution Act of
1990 (as same may be amended and/or re-enacted from time to time hereafter) or
similar legislation, regardless of whether or not caused by or within the
control of the Charterer; and

(x)
liquidating, employing or prepaying funds acquired or borrowed to purchase or
finance or refinance the Vessel (including any costs incurred in unwinding any
associated interest rate or currency swaps or currency futures) following any
default in payment by the Charterer hereunder or the occurrence of any
Termination Event which is continuing.

Provided always that the Charterer shall be entitled to take, in the name of the
Owner and following receipt of the Owner's written consent, such reasonable
action as the Charterer sees fit to defend or avoid any or to recover the same
from any third party losses.
(b)
The provisions of this clause 9.1 (Operational Indemnity) will continue to be in
full force and effect notwithstanding the expiry or termination of this Charter,
and notwithstanding cessation of business of the Charterer, dissolution of the
Charterer, any change in the constitution of the Charterer, or any other fact,
event or circumstance of any kind whatsoever, whether similar to any of the
foregoing or not.

9.2
Claim Procedure

(a)
The Owner will request each Indemnitee to notify the Charterer as soon as
reasonably practicable after a written claim is made against that Indemnitee
with respect to any matter for which the Charterer is responsible under clause
9.1 (Operational Indemnity).

(b)
The Charterer may (with the Owner's prior written consent), in consultation with
the Owner and the relevant Indemnitee, assume and conduct promptly and
diligently the defence of any claim giving rise to an obligation on the
Charterer to indemnify under clause 9.1 (Operational Indemnity) provided that:

(i)
no Termination Event has occurred and is continuing;

(ii)
the contest does not raise any material risk of the sale, forfeiture or loss of
the Vessel;

(iii)
independent legal counsel reasonably acceptable to the relevant Indemnitee is of
the opinion, confirmed in writing to the Owner, that a reasonable basis exists
for contesting the relevant claim;

(iv)
the commercial position and the business reputation of the relevant Indemnitee
will not be materially or adversely affected by contesting the relevant claim;
and

(v)
the Charterer will be responsible for, and will indemnify each Indemnitee upon
demand against, all reasonable out-of-pocket expenses suffered as a consequence
of the Charterer's contesting the relevant claim.

(c)
No Indemnitee will, by reason of the Charterer's contesting a claim in
accordance with clause 9.2(b), be prevented from settling or paying any claim if
required by applicable law.

9.3
Transaction Expenses

(a)
The Charterer will bear all reasonable costs and expenses (including legal fees,
travel expenses and accommodation costs) incurred by the Owner and the Finance
Parties in connection with the preparation, negotiation, printing, execution of
the Transaction Documents, registration of the Vessel and the Vessel Mortgage in
Panama in the ownership of the Owner, and registration of any Security Document
in a Relevant Jurisdiction as advised as being necessary or desirable by the
Owner’s legal counsel and in connection with amendments to, and/or the
correction of any error in, any Transaction Document together with all other
costs and expenses incurred in connection with the acquisition and chartering of
the Vessel.

(b)
The Charterer will upon demand indemnify the Owner or any Finance Party against:

(i)
all reasonable costs and expenses (including legal fees) incurred by the Owner
in responding to, evaluating, negotiating or complying with any request by the
Charterer for an amendment, waiver or consent under this Charter and any other
document referred to in this Charter, including any document executed to provide
additional security to the Charterer which forms part of the Charterer Security
Assets;

(ii)
all reasonable costs and expenses (including legal fees) incurred by the Owner
as a consequence of the occurrence of a Termination Event or Default or
investigation of any Default; and

(iii)
all reasonable costs and expenses (including legal fees) incurred by the Owner
in connection with the enforcement of, or the preservation of any rights under,
any Transaction Document.

10
Payments

10.1
Payments

(a)
On each date on which the Charterer is required to make a payment under this
Charter or any other Transaction Document, the Charterer shall make the same
available to the Owner for value on the due date at the time and in U.S. Dollars
or (in relation to Supplemental Hire or a part thereof) in such other currency
as may be specified by the Owner.

(b)
Payments shall be made to the U.S. Dollar account of the Owner with Sumitomo
Mitsui Banking Corporation, Tokyo main office with account number 231045 or such
other account with such bank as the Owner or its assignees may specify in
writing from time to time.

(c)
The Charterer shall comply with all applicable laws and regulations in relation
to any payment made or to be made under this Charter or any other Transaction
Document.

10.2
No Set-off etc.

The Vessel shall not at any time be deemed off-hire and the Charterer's
obligation to pay all Charterhire and other amounts payable under this Charter
shall be absolute and unconditional under any and all circumstances and shall
not be affected by any circumstances of any nature whatsoever and whether or not
similar to any of the matters set out in paragraphs (a) to (l) below, including,
without limitation:
(a)
any right of set-off, counterclaim, recoupment, defence or other right which
either the Charterer or the Owner may have against the other or any other person
for any reason whatsoever;

(b)
the unavailability of the Vessel for any reason, including (but not limited to)
any invalidity or other defect in the title, the seaworthiness, condition,
design, operation, performance, capacity, merchantability, or fitness for use or
ineligibility of the Vessel for any particular trade or operation or for
registration or documentation under the laws of any country or any damage to the
Vessel;

(c)
the failure by any sub-charterer or any other person to pay any earnings or
other amount to the Charterer or other person for any reason;

(d)
any incapacity, disability, or defect in powers of the Charterer, or any
irregular exercise thereof by, or lack of authority of, any person purporting to
act on behalf of the Charterer;

(e)
any failure or delay on the part of the Charterer whether with or without fault
or negligence on its part and whether or not constituting a serious, fundamental
or repudiatory breach of contract on its part, in performing or complying with
any of the terms or covenants hereunder or under any of the Transaction
Documents;

(f)
any other cause which, but for this provision, might operate to exonerate the
Charterer from liability, whether in whole or in part, under this Charter;

(g)
any insolvency, bankruptcy, administration, reorganisation, arrangement,
readjustment of debt, dissolution, liquidation or similar proceedings in
relation to the Owner or its parent company (unless same deprives the Charterer
of the use of the Vessel), the Charterer or any other person or the lack of due
authorisation of or other defect in this Charter;

(h)
any title defect or Security Interest or any dispossession of the Vessel by
title paramount or otherwise except for those caused by any act of the Owner not
permitted under this Charter;

(i)
any damage to or loss, destruction, capture, seizure, judicial attachment or
arrest, forfeiture or marshal's or other sale of the Vessel;

(j)
any lien, attachment, levy, detainment, sequestration or taking into custody of
the Vessel or any restriction or prevention of or interference with or
interruption or cessation in, or interference with, or prohibition of, the use
or possession thereof by the Charterer for any reason whatsoever and regardless
of duration;

(k)
any change, extension, indulgence or other act or omission in respect of any
indebtedness or obligation of the Charterer, or any sale, exchange, release or
surrender of, or other dealing in, any security for any such indebtedness or
obligation; or

(l)
any invalidity, unenforceability, lack of due authorisation or other defect, or
any failure or delay in performing or complying with any of the terms and
provisions of this Charter or any of the other Transaction Documents by any of
the Obligors,

whether or not the Charterer shall have notice or knowledge of any of the
foregoing. The Charterer waives all rights it might otherwise have had to reduce
or not pay any amount under the Transaction Documents by reason of any of the
matters described above or otherwise.
10.3
[Intentionally omitted]

10.4
Partial Payments

If any sum paid to the Owner or recovered by the Owner in respect of the
liabilities of the Charterer under this Charter is less than the amount then
due, the Owner may apply that sum in accordance with clause 20.26 (Waterfall) or
in the manner as the Owner shall determine in its sole discretion.
10.5
Business Days

(a)
Any payment which is due to be made on a day that is not a Business Day shall be
made on the next Business Day in the same calendar month (if there is one) or
the preceding Business Day (if there is not).

(b)
During any extension of the due date for payment of any principal or Unpaid Sum
under paragraph (a) above, interest is payable on the principal or Unpaid Sum at
the rate payable on the original due date.

10.6
Currency Indemnity

If any sum due from an Obligor under this Charter or any other Transaction
Document or any order or judgment given or made in relation thereto has to be
converted from the currency (the "first currency") in which the same is payable
hereunder, or under such order or judgment into another currency (the "second
currency") for the purpose of (a) making or filing a claim or proof against the
Charterer, (b) obtaining an order or judgment in any court or other tribunal,
(c) enforcing any order or judgment given or made in relation thereto or (d)
satisfying the obligations of the Charterer under this Charter or any other
Transaction Document, the Charterer will indemnify and hold harmless the Owner
from and against any loss suffered as a result of any discrepancy between (i)
the rate of exchange used for such purpose to convert the sum in question from
the first currency into the second currency and (ii) the rate or rates of
exchange at which the Owner may in the ordinary course of business purchase the
first currency with the second currency upon receipt of a sum paid to them in
satisfaction, in whole or in part, of any such order, judgment, claim or proof.
10.7
Default Interest

(a)
If any amount payable under any Transaction Document is not paid at the time and
place and in the manner due, interest will accrue on the Unpaid Sum from the due
date up until the date of actual payment (both before and after judgment), at
the Default Interest Rate.

(b)
Default interest (if unpaid) arising on any Unpaid Sum will be compounded with
the Unpaid Sum on a daily basis but will remain immediately due and payable.

10.8
Payments on Demand

Unless otherwise required, any payment described in this Charter as payable on
demand must be paid no later than three (3) Business Days after a demand.
10.9
Other Payments

The Charterer covenants, undertakes and agrees that it will pay to the Owner on
demand of the Owner amounts equal to any and all amounts incurred as owner which
may from time to time become payable or be expressed to be payable by the Owner
to any Finance Party in respect of which is expressed to be payable to or
indemnified by the Owner to a Finance Party under or pursuant to the Finance
Documents or any other Transaction Document.

11
Representations

The Charterer makes the representations and warranties set out in this clause 11
to the Owner on the date of this Charter.
11.1
Status

(a)
It is an exempted company duly incorporated, validly existing and in good
standing under the laws of Bermuda and has full power to own its assets and
carry on its business as being conducted at the date of this Charter.

(b)
The Charterer is not resident for tax purposes in the United States of America.

11.2
Authorisation

(a)
Each Group Member has full power and has taken all necessary actions to
authorise its entry into and performance of, the Transaction Documents to which
it is or will be a party and the transactions contemplated by those Transaction
Documents.

(b)
All authorisations, acts, government or regulatory approvals or other
third-party consents which are required or advisable in connection with each
Group Member’s entry into, performance, legality, validity and enforceability
of, and the transactions contemplated by, the Transaction Documents to which it
is or will be a party have been, or will be when necessary, obtained or
performed (as appropriate) and are, or will be when necessary, in full force and
effect.

11.3
Form and Effect of the Transaction Documents

(a)
Subject to the Legal Reservations, each Transaction Document to which a Group
Member is a party is in the proper form and has been duly and properly executed
and delivered for its enforcement in England and the country of the laws by
which that Transaction Document is expressed to be governed.

(b)
Subject to the Legal Reservations, each Transaction Document to which a Group
Member is a party constitutes its legal, valid and binding obligations,
enforceable in accordance with its terms.

(c)
The entry into and performance by each Group Member of, and the transactions
contemplated by, the Transaction Documents to which it is a party does not
conflict with:

(i)
its constitutional documents ;

(ii)
any document which is binding upon it or any of its assets; or

(iii)
any law or regulation applicable to it.

(d)
No Transaction Document has been amended or terminated unless such amendment or
termination has been made in accordance with the terms thereof, or, as the case
may be, with the agreement of the relevant parties.

11.4
No Termination Event

(a)
No Termination Event is outstanding or would result from the execution of, or
the performance of any transaction contemplated by, any Transaction Document;
and

(b)
no other event or circumstance is outstanding which constitutes a default under
any other agreement or instrument which is binding on it or to which its assets
are subject.

11.5
No Group Member has been notified of any event of default, termination event or
occurrence of force majeure (however so described) in connection with any
Transaction Document.

11.6
No Litigation

No litigation, arbitration or administrative proceedings (other than those which
are in the opinion of the Owner frivolous or vexatious or which are discharged,
stayed or dismissed within twenty-one (21) days of its commencement) are
current, or to its knowledge pending or threatened against any Group Member,
which have, or if decided adversely would have, a Material Adverse Effect.
11.7
Information

All information (the Information) which has been provided by any Group Member in
connection with any Transaction Document and the sale, operation and/or charter
of the Vessel is true and accurate in all material respects as at its date or
(if appropriate) as at the date (if any) at which it is stated to be given and
no Group Member has failed to provide any information, the omission of which
would make the Information misleading or incorrect.
In particular, the Original Financial Statements and all other Reports prepared
by Pangaea on its or other Group Member’s behalf are accurately and duly
prepared in accordance with GAAP, consistently applied, and since the date of
its Original Financial Statements, there has been no material change which will
cause a deterioration of its or any other Group Member’s business, assets, or
financial condition described in the audited or unaudited financial statements
of that fiscal year and which may materially affect its or the relevant Group
Member’s performance of its obligations under the Transaction Documents to which
it is party.
11.8
Proceedings to Enforce

(a)
Each Group Member’s:

(i)
agreement that the Transaction Documents to which it is a party (with the
exception of the Vessel Mortgage) are governed by English law; and

(ii)
submission under this Charter and the other Transaction Documents to which it is
party to the jurisdiction of the courts of England,

are, subject to Legal Reservations, legal, valid and binding under the laws of
its Relevant Jurisdictions.
(b)
Any judgment obtained in England and Wales in relation to a Transaction Document
will be recognised and be enforceable by the courts of its Relevant
Jurisdictions.

11.9
Immunity

No Obligor nor any of its assets has any right of immunity from suit, execution,
attachment or other legal process in any legal proceedings in relation to a
Transaction Document to which it is a party taken in any jurisdiction,
including, without limitation, in its Relevant Jurisdictions.
11.10
Commercial Activity

(a)
Each Obligor is subject to any civil and commercial law with respect to its
obligations under each Transaction Document to which it is a party. The
execution and delivery of each Transaction Document to which it is a party
constitute, and each Obligor’s performance of and compliance with its
obligations under each Transaction Document to which it is a party will
constitute, private and commercial acts rather than public or governmental acts.

(b)
The Charterer carries on no other business other than the ownership, operation,
chartering of vessels or activities incidental thereto.

11.11
Taxes

Subject to Legal Reservations and save for payments necessary to effect the
registrations referred to in clause 11.15 (Registration Requirements), under the
laws of each Obligor’s Relevant Jurisdiction, there is no Tax imposed or payable
(whether by withholding or otherwise) on or by virtue of the execution and
delivery of the Transaction Documents to which it is a party or any document or
instrument to be executed and delivered hereunder, the performance, enforcement
or admissibility in evidence hereof or thereof, or on any payment required to be
made hereunder or thereunder.
11.12
Security

(a)
From the date of this Charter or (if later) the date on which the applicable
Charterer Security Assets are acquired by it, the Charterer is the sole legal
and beneficial owner of the Charterer Security Assets and it has not sold or
transferred all or any part of the Charterer Security Assets to a third party
nor has it created or assumed any Security Interests over all or any part of any
of the Charterer Security Assets other than pursuant to the Security Documents.

(b)
Subject to Legal Reservations, each of the Security Documents to which a Group
Member is party creates the rights it purports to and in the case of each of the
Security Assignment and the Manager's Undertaking, creates a legal valid and
enforceable security interest which is expressed to be created thereby.

11.13
No Adverse Consequences

(a)
It is not necessary under the laws of its Relevant Jurisdictions:

(i)
in order to enable the Owner or any Finance Party to enforce its rights under
any of the Transaction Documents to which it is a party; or

(ii)
by reason of the entry into of any Transaction Document or the performance by it
of its obligations under any Transaction Document,

that any Finance Party should be licensed, qualified or otherwise entitled to
carry on business in any such Relevant Jurisdiction.
(b)
No Finance Party is or will be deemed to be a resident, domiciled or carrying on
business in any such Relevant Jurisdiction by reason only of the entry into,
performance and/or enforcement of any Transaction Document.

11.14
[Intentionally omitted]

11.15
Registration Requirements

Except for registration of the Security Documents to which the Charterer is a
party in the Relevant Jurisdiction (and with the Registrar of Companies in
Bermuda) and the registration of the Vessel Mortgage with the Panama Ship
Registry, it is not necessary to file, register or otherwise record any
Transaction Document or any other instrument or agreement required thereunder in
any court, public office or elsewhere in any Relevant Jurisdiction, or to pay
any stamp, registration or similar tax on or in relation to any such Transaction
Document or any such instrument or agreement required thereunder to ensure the
validity, legality, effectiveness, enforceability or admissibility in evidence
thereof.
11.16
Pari Passu

Each Obligor's obligations and liabilities under the Transaction Documents to
which it is a party are unconditional and general obligations and the claims of
the Owner and any of the Finance Parties under such Transaction Documents rank
and will rank at least pari passu with all of its other present or future claims
in respect of unsecured and unsubordinated obligations (both actual and
contingent) save for those obligations and claims preferred by law and applying
to companies generally.
11.17
Compliance with laws

Each Obligor is in compliance with all laws (including but not limited to
Environmental Laws), decrees and regulations to which it is subject.
11.18
No insolvency

No Obligor is insolvent and no legal proceedings have commenced in respect of
any Obligor for its winding-up, dissolution, administration, re-organisation,
reconstruction or other proceeding analogous (however so described) in purpose
or effect, or for the appointment of a receiver, administrator, administrative
receiver, trustee, reconstructor or similar officer (however so described) of it
or of any or all of its revenues and assets.
11.19
Material Adverse Effect

No Material Adverse Effect has occurred.
11.20
Environmental Review

In the ordinary course of its business, the Charterer conducts an ongoing review
of the effect of local environmental laws and standards on the business,
operations and properties of itself and its subsidiaries (if any), in the course
of which it identifies and evaluates liabilities and costs related thereto
(including, without limitation, with respect to any clean-up or closure of
properties, compliance with applicable operating constraints, disposal of wastes
and possible liabilities to employees and other third parties). On the basis of
this review, the Charterer has reasonably concluded that such liabilities and
costs are unlikely to have a Material Adverse Effect.
11.21
Environmental Matters

To the best of the knowledge and belief of each Group Member and its officers:
(a)
all Environmental Laws applicable to the Vessel have been complied with and all
consents, licences and approvals required under such Environmental Laws have
been obtained and complied with; and

(b)
no Environmental Claim has been made or threatened or is pending against any
Obligor or the Vessel which will, or is likely to, have a Material Adverse
Effect and not fully satisfied.

11.22
No default under other Financial Indebtedness

No Obligor is (or would, with the giving of notice or lapse of time or the
satisfaction of any other condition or combination thereof, be) in breach of or
in default under any agreement relating to Financial Indebtedness to which it is
a party or by which it may be bound and the sum of which exceeds the sum of two
million and five hundred thousand U.S. Dollars (US$2,500,000) or its equivalent
in any other currency.
11.23
Freedom from Security Interests

Neither the Vessel nor any Charterer Security Assets, nor any part thereof (in
any such case), will be, on and after the date of this Charter, subject to any
Security Interests save for any Permitted Security Interests.
11.24
Vessel Management Agreement

Unless otherwise agreed in writing by the Owner (which agreement shall not be
unreasonably withheld or delayed), other than any Vessel Management Agreement,
the Charterer has not entered into any management agreement or other contract
relating to the management of the Vessel.
11.25
No Sharing of earnings

There is no or will not be any agreement or arrangement whereby the earnings of
the Vessel may be shared with or assigned to any other person or subject to a
Security Interest save for any Permitted Security Interest.
11.26
Vessel Representations

(a)
The Vessel will on the Delivery Date be:

(i)
registered in the relevant State of Registration which is Panama for the time
being under the Panama flag in the name of the Owner as legal owner;

(ii)
operationally seaworthy and in every way fit for service;

(iii)
classed with the relevant classification free of any overdue requirements and
recommendations of the relevant Classification Society; and

(iv)
insured in the manner required by this Charter.

(b)
The Vessel shall on the Delivery Date be free of any other charter commitment
which, if entered into after that date, would require approval under this
Charter.

11.27
Antisocial Forces and Acts

(a)
No Group Member falls within any paragraphs in the definition of "Antisocial
Forces".

(b)
No Group Member has committed, or caused any third party to commit, an
Antisocial Act.

11.28
Repetition

The representations and warranties set out in clause 11 (Representations) are
deemed to be made by the Charterer on the date of this Charter and, unless a
representation or warranty is expressed to be made at a specific date, by
reference to the facts and circumstances then existing on each Payment Date.

12
Information Undertakings

The undertakings in this clause 12 remain in force from the date of this Charter
and during the Charter Period. For the avoidance of doubt, any information
provided by the Charterer or any Group Member to the Owner as required in this
clause 12 shall be deemed to be served on the Finance Parties if the same
information is so required by the Finance Party under the relevant Finance
Documents.
12.1
Consultation and Visit

(a)
The Charterer shall, from time to time, at the request of the Owner, consult
with the Owner with respect to the implementation and administration of this
Charter and the other Transaction Documents and the purchase, ownership and
operation of the Vessel.

(b)
The Charterer shall afford (and shall, in relation to the premises or offices of
any Group Member that is party to a Transaction Document, procure that such
Group Member affords) all reasonable opportunity for representatives of the
Owner and the Finance Parties to visit any part of the premises or offices of
any such Group Member and/or the Vessel for purposes relating to this Charter
and the other Transaction Documents and/or to monitor the operation of the
Vessel.

12.2
Information

(a)
The Charterer shall provide the Owner with copies of its unaudited management
accounts for each fiscal quarter and Pangaea's consolidated independently
audited annual financial statements and unaudited interim annual financial
statements promptly after each is prepared, and in any event not later than (i)
one hundred and eighty (180) days after the end of Pangaea’s financial year in
the case of Pangaea’s consolidated independently audited annual financial
statements, (ii) one hundred and twenty (120) days after the end of Pangaea’s
financial year in the case of Pangaea’s consolidated interim annual financial
statements and (iii) ninety (90) days after each of its financial quarters in
the case of the Charterer’s unaudited management accounts. Such financial
statements shall be prepared in accordance with applicable GAAP consistently
applied and (if not in English) shall be accompanied by a certified English
translation.

(b)
The Charterer shall:

(i)
provide the Owner as the Owner may reasonably request with any other information
(financial or otherwise) or documents including but not limited to (i) the
implementation and administration of this Charter, the other Transaction
Documents and the purchase, ownership, employment and operation of the Vessel or
(ii) the financial condition, business, employment and operations of any Group
Member, that is a party to a Transaction Document;

(ii)
provide to the Owner copies of all documents, requests, notices or
correspondence (other than those of a purely administrative nature) given or
received by it under any Transaction Document; and

(iii)
promptly answer in writing, in reasonable detail, all reasonable questions in
respect of the financial condition and business activities of the Obligors which
the Owner may submit to the Charterer in writing.

(c)
The Charterer shall furnish to the Owner for the Finance Parties such know your
customer documentation as a Finance Party may (through the Owner) reasonably
request from time to time.

12.3
Notification of Termination Event

(a)
Immediately upon becoming aware of its occurrence (or when the Charterer could
be reasonably expected to be aware of such an occurrence), the Charterer shall
notify the Owner of any Termination Event (and the steps, if any, being taken to
remedy it).

(b)
Immediately after becoming aware of the same, the Charterer shall inform the
Owner of (i) the imposition of or amendment to any laws, decrees or regulations
adversely affecting (x) any Obligor and their ability to perform their
respective obligations under the Transaction Documents or (y) this Charter or
any other Transaction Document and (ii) the occurrence of any event or
circumstance which may have a Material Adverse Effect.

(c)
The Charterer shall provide to the Owner copies of all documents despatched by
any Obligor to their creditors generally or any class of them at the same time
as they are despatched.

(d)
The Charterer shall provide to the Owner promptly upon becoming aware of them,
details of any material litigation, arbitration or administrative proceedings
which are current, threatened or pending against the Charterer or any other
Obligor and which involve an amount in excess of two million five hundred
thousand U.S. Dollars (US$2,500,000);

(e)
The Charterer shall provide to the Owner promptly, details of each material
breach by the Charterer or any other Obligor of its contractual obligations to
any third party (or third parties) which may result in one or more claims
against the Charterer or any other Obligor.

12.4
Operational Information

The Charterer shall:
(a)
promptly notify the Owner of the occurrence of any accident, casualty or other
event which has caused or resulted in or may cause or result in the Vessel being
or becoming a Total Loss;

(b)
promptly notify the Owner of any requirement or recommendation made by any
insurer or Classification Society or by any competent authority in respect of
the Vessel which is not complied with within the time allowed for compliance by
the insurer, Classification Society or, as the case may be, the authority in
question in each instance;

(c)
promptly notify the Owner of any claim for any material breach of the ISM Code
or ISPS Code being made in connection with the Vessel, its operation or the
Charterer;

(d)
give to the Owner from time to time, on request, such information as the Owner
may reasonably require regarding the Vessel, her employment, position and
engagements;

(e)
provide the Owner, on request, with copies of the classification certificates of
the Vessel and of all periodic damage or survey reports on the Vessel;

(f)
promptly furnish the Owner with full information of any casualty or other
accident or damage to the Vessel involving an amount in excess of five hundred
thousand U.S. Dollars (US$500,000) (or the equivalent in another currency);

(g)
if there is a Termination Event, furnish to the Owner from time to time upon
request certified copies of the log and itinerary in respect of the Vessel;

(h)
notify the Owner of any assistance given to the Vessel which is likely to result
in a lien for salvage over the Vessel

(i)
notify the Owner of any intended dry docking of the Vessel;

(j)
give to the Owner, the Finance Parties and their duly authorised representatives
access to the Vessel for the purpose of conducting on board inspections and/or
surveys of the Vessel as the Owner may reasonably request provided that such
access, inspections and/or surveys do not unreasonably disrupt the Vessel's
commercial use and operation (except where a Termination Event has occurred,
whereupon such access will be permitted at all times). The Charterer shall pay
all expenses incurred by the Owner and the Finance Parties in connection with
any inspections or survey carried out while a Termination Event has occurred,
and otherwise for no more than a single inspection or survey in a twelve month
period;

(k)
promptly following receipt of a request by the Owner, provide the Owner with any
additional or further information which it is reasonable to request relating to
the Vessel, the Compulsory Insurances, this Charter or to any other matter
relevant to, or to any provision of, a Transaction Document;

(l)
promptly provide copies of any notice of default, termination, dispute or claim
made against the Charterer or affecting the Vessel together with details of any
action it proposes to take in relation to the same;

(m)
no later than fifteen (15) days before the Delivery Date and every six months
from the Delivery Date (except when a Termination Event has occurred and in
which case the Charterer shall provide more frequent valuations), the Charterer
shall at its own cost provide two appraisal reports for the Fair Market Value of
the Vessel.  Where there is a disparity of more than ten per cent (10%) in the
Fair Market Value based on the two valuations, the Charterer will at its own
expense procure a third valuation from a different Approved Valuer and the Fair
Market Value shall be based on the average of the two closest valuations; and

(n)
promptly provide all such information as the Owner shall from time to time
reasonably require regarding all insurances on or in respect of the Vessel and
copies of all policies, cover notes and all other contracts of insurance which
are from time to time taken out or entered into in respect of the Vessel or
otherwise howsoever in connection with the Vessel so that the Owner is at all
times able to determine whether the Vessel has been adequately insured as
provided for in this Charter.

12.5
Environmental

The Charterer shall promptly notify the Owner of:
(a)
any Environmental Claim which exceeds one million U.S. Dollars (US$1,000,000) or
its equivalent in any other currency, in respect of the use or operation of the
Vessel current, or to its knowledge, pending or threatened against it or any of
its affiliates;

(b)
any circumstances reasonably likely to result in an Environmental Claim which
will exceed one million U.S. Dollars (US$1,000,000) or its equivalent in any
other currency in respect of the use or operation of the Vessel against it or
any of its Affiliates;

(c)
any suspension, revocation or modification of any material Environmental
Approval in respect of the use or operation of the Vessel; and

(d)
any emission, spill, release or discharge into or upon the air, surface water,
groundwater, or soils of Hazardous Material arising as a result of its use or
operation of the Vessel, and in each case such notification shall take the form
of a certificate of an officer of the Charterer specifying in detail the nature
of the event or circumstances.

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13
General Undertakings

The undertakings in this clause 13 remain in force from the date of this Charter
and throughout the Charter Period.
13.1
Authorisations

The Charterer shall promptly obtain, maintain and comply with any authorisation
or permit required under any applicable law or regulation in order to perform
its obligations under, or for the legality, validity or enforceability of any
Transaction Document to which it is a party.
13.2
Pari Passu

The Charterer shall ensure that its payment obligations under the Transaction
Documents to which it is a party at all times rank at least pari passu with all
of its other present and future unsecured and unsubordinated indebtedness except
for obligations mandatorily preferred by law applying to companies generally.
13.3
Compliance with Laws

The Charterer shall comply in all respects with all laws (including but not
limited to Environmental Laws), decrees and regulations to which it or its
business is subject where failure to do so has or is reasonably likely to have a
Material Adverse Effect.
13.4
Disposals

The Charterer shall not, without the prior written consent of the Owner, sell,
transfer, abandon, lend (other than charter the Vessel pursuant to the terms of
this Charter) or otherwise dispose of any assets or properties.
13.5
Merger

The Charterer shall not consent to or enter into any continuation out of
Bermuda, amalgamation, de-merger, merger or reconstruction of itself or take any
other action to materially change the nature of its business without the prior
written consent of the Owner, such consent not to be unreasonably withheld.
13.6
Registration

The Charterer shall file, register or otherwise record (or shall procure to be
filed, registered or otherwise recorded), each Transaction Document to which it
is party and any instrument or agreement required thereunder in any court,
public office or elsewhere in any other relevant jurisdiction (including the
making of any registrations required or desirable in connection with the
creation of the Security Interests contemplated thereby, in each case, within
the time limit prescribed by applicable law) and the Charterer shall pay any
stamp, registration or similar tax on or in relation to this Charter or any
other Transaction Document or any other instrument or agreement required
thereunder if at any time so required to ensure the validity, legality,
effectiveness, enforceability or admissibility in evidence thereof.
13.7
State of Incorporation

The Charterer shall maintain its place of incorporation (whether for legal, tax,
accounting purposes or otherwise) in Bermuda.
13.8
Corporate Status

The Charterer shall:

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(a)
do all such things as are necessary to maintain its corporate existence and good
standing; and

(b)
ensure that it has the right and is duly qualified in all material respects to
conduct its business as it is being conducted in all applicable jurisdictions.

13.9
Constitutional Documents and Scope of Business

The Charterer shall not (and shall procure its shareholders shall not) change
its constitutional documents except for non-material matters which would have no
adverse impact on the Owner or Finance Parties' rights under the Transaction
Documents or carry on any other business other than the ownership, operation,
chartering of vessels.
13.10
Taxes

The Charterer shall file all tax filings and all informational returns that are
required to have been filed by it under applicable law in all relevant
jurisdictions and pay and discharge all Taxes due and payable from it or against
its assets (other than those being contested in good faith and where such
payment may be lawfully withheld).
13.11
Change of Accounting Period

Except with the prior written consent of the Owner which shall not be
unreasonably withheld, the Charterer shall not change its accounting periods or
its auditors.
13.12
Further Assurance

The Charterer shall promptly take such steps as the Owner may deem necessary or
appropriate to maintain and protect the interests of the Owner under the
Transaction Documents to which the Charterer is a party, including filing and/or
registering any of such Transaction Documents and the execution of such
additional documents as the Owner may reasonably require.
13.13
Negative Pledge

The Charterer shall not, without the prior written consent of the Owner, create,
assume or suffer to exist any Security Interest upon:
(a)
all or any part of its present or future undertaking, assets, or revenues
(including, without limitation, any charter hire or any other amounts payable by
a sub-lessee or sub-charterer under any charter arrangement in respect of the
Vessel to which the Charterer is a party); and

(b)
the Vessel, save for Permitted Security Interests and Owner Encumbrances.

13.14
Financial Indebtedness

The Charterer may not incur or permit to be outstanding any Financial
Indebtedness, other than Permitted Indebtedness.
13.15
No Amendment to Contracts

The Charterer shall:
(a)
neither make nor permit to be made any amendment to any Transaction Document to
which it is party without the prior written consent of the Owner;

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(b)
nor terminate any Transaction Document to which it is party without the prior
written consent of the Owner, or waive any material breach by any party of its
obligations under the Transaction Document to which it is party without prior
written consent of the Owner.

13.16
Sanctions

(a)
The Charterer will, to the best of its actual knowledge and belief, prevent the
Vessel from being used, directly or indirectly:

(i)
by, or for the benefit of, any Prohibited Person; and/or

(ii)
in any trade which would be in violation of any Sanctions.

(b)
The Charterer will (so long as failing to do so would violate Sanctions) prevent
the Vessel from trading to Iranian ports or carrying petrochemical products if
they originate in Iran, or are being exported from Iran to any other country,

save for the situation whereby an authorisation issued by a Sanctions Authority
is obtained and in full force and effect.
13.17
Antisocial Forces and Acts

The Charterer shall not do anything that would:
(a)
fall within any paragraph in the definition of "Antisocial Forces"; and/or

(b)
commit, or cause any third party to commit, any Antisocial Act.

13.18
Collateral Maintenance Ratio

(a)
If at any time the Owner notifies the Charterer that the ratio of (i) the
aggregate of the Fair Market Value (determined pursuant to clause 12.4(m)) of
the Vessel and the net realisable value of any additional security provided at
any time under this clause 13.18 to (ii) the Charterhire Principal (such ratio
being the Collateral Maintenance Ratio), is less than the percentage for the
applicable period below, the Charterer shall be required to comply with the
provisions of clause 13.18(b) below:

(i)
between the period from Delivery Date until and including the first anniversary
of the Delivery Date: one hundred per cent (100%) of the Charterhire Principal;

(ii)
between the period beginning the next day after the first anniversary of the
Delivery Date and ending on the date falling eighteen (18) months from the
Delivery Date: one hundred and five per cent (105%) of the Charterhire
Principal;

(iii)
between the period beginning the next day after the date falling eighteen (18)
months from the Delivery Date and ending on the second anniversary of the
Delivery Date: one hundred and ten per cent (110%) of the Charterhire Principal;

(iv)
between the period beginning the next day after the second anniversary of the
Delivery Date and ending on the date falling thirty (30) months from the
Delivery Date: one hundred and fifteen per cent (115%) of the Charterhire
Principal;

(v)
between the period beginning the next day after the date falling thirty (30)
months from the Delivery Date and ending on the third anniversary of the
Delivery Date: one hundred and twenty per cent (120%) of the Charterhire
Principal;

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(vi)
between the period beginning the next day after the third anniversary of the
Delivery Date and ending on the date falling forty two (42) months from the
Delivery Date: one hundred and twenty five per cent (125%) of the Charterhire
Principal;

(vii)
between the period beginning the next day after the date falling forty two (42)
months from the Delivery Date and ending on the fourth anniversary of the
Delivery Date: one hundred and thirty per cent (130%) of the Charterhire
Principal; and

(viii)
thereafter: one hundred and thirty five per cent (135%) of the Charterhire
Principal.

(b)
The Owner shall notify any prepayment under this clause 13.18(b) no later than
five (5) days prior to Delivery or each second Payment Date. Upon the Owner
notifying the Charterer under clause 13.18(a) in regard to any shortfall in the
Collateral Maintenance Ratio (the Shortfall Amount), the Charterer shall either:

(i)
prepay an amount of Charterhire on the Delivery Date or the Payment Date
referred to in clause 13.18(b) above in accordance with clause 6.3(b), (d) and
(e) (Prepayment of Charterhire) (but omitting (A) the ten (10) Business Days'
notice requirement and (B) the requirement that a partial payment must be in a
minimum amount of US$500,000 (five hundred thousand US Dollars) and integral
multiples thereof pursuant to clause 6.3(b)); or

(ii)
on or before the relevant Payment Date, agree with the Owner the form of further
security to be provided or procured and provide or procure such security no
later than 10 days after that Payment Date,

so that the Collateral Maintenance Ratio is no longer below the applicable
percentage in clause 13.18(a).
13.19
Charterer's financial covenants

(a)
Tested on the last day of each fiscal quarter beginning from 1 April 2017,
Pangaea’s Consolidated Leverage Ratio shall not be higher than two hundred per
cent (200%).

Consolidated Leverage Ratio means, a fraction (expressed as a percentage,
rounded up to the nearest tenth of a percent) where (a) the numerator is a
number equal to the consolidated Financial Indebtedness of Pangaea and (b) the
denominator is Consolidated Net Worth; and
Consolidated Net Worth means, as at the end of the applicable accounting period,
the amount shown as “Total Shareholders’ Equity” under the heading
“Shareholder’s Equity” appearing in the latest consolidated financial statements
for the relevant accounting period, adjusted to take account of any differences
between (1) the book values (net of depreciation) of the Fleet Vessels and (2)
the Fleet Market Value.
(b)
Tested on the last day of each fiscal quarter beginning at 1 April 2017,
Pangaea’s Consolidated DSCR on a rolling four quarter basis shall be at least:

(i)
1.00 between the first day of the second quarter of the 2017 fiscal year and the
last day of the second quarter of the 2017 fiscal year;

(ii)
1.05 between the first day of the third quarter of the 2017 fiscal year and the
last day of the third quarter of the 2017 fiscal year; and

(iii)    1.20 at all times thereafter.
Consolidated Debt Service means, on a consolidated basis, the aggregate amount
of principal and Consolidated Net Interest Expense paid or scheduled to be paid
by Pangaea

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on its consolidated Financial Indebtedness for the immediately preceding twelve
month period;
Consolidated DSCR means, a fraction (expressed as a percentage, rounded up to
the nearest tenth of a percent) where (a) the numerator is Consolidated EBITDA
and (b) the denominator is Consolidated Debt Service;
Consolidated EBITDA means, for any accounting period, the net income of on a
consolidated basis for that accounting period:
(a)
plus, to the extent deducted in computing the consolidated net income of Pangaea
for that accounting period, the sum, without duplication, of:

(i)    all federal, state, local and foreign income taxes and tax distributions;
(ii)    Consolidated Net Interest Expense;
(iii)
depreciation, depletion, amortization of intangibles and other non-cash charges
or non-cash losses (including non-cash transaction expenses and the amortization
of debt discounts) and any extraordinary losses not incurred in the ordinary
course of business; and

(iv)    any drydocking expenses;
(b)
minus, to the extent added in computing the consolidated net income of Pangaea
for that accounting period, any non-cash income or non-cash gains and any
extraordinary gains on asset sales or otherwise not incurred in the ordinary
course of business;

Consolidated Net Interest Expense means, on a consolidated basis, the aggregate
of all interest, commitment and other fees, commissions, discounts and other
costs, charges or expenses accruing that are due from Pangaea during the
relevant accounting period less interest income received, determined in
accordance with U.S. GAAP and as shown in the statement of income for Pangaea;
Fleet Market Value means, as of the date of calculation, the aggregate market
value of:
(i)
the Vessel, as most recently determined by the Owner pursuant to valuations
obtained by the Charterer in accordance with the provisions of clause 12.4(m);
and

(ii)
all other Fleet Vessels (other than the Vessel), as determined by the Owner in
accordance with U.S. GAAP acting reasonably.

Fleet Vessels means all the vessels (including, but not limited to the Vessel)
from time to time owned by Group Members and Fleet Vessel means any of them.
(c)
Tested on the last day of each fiscal quarter beginning from 1 April 2017,
Pangaea’s minimum liquidity in Free Cash shall not be less than:

(i)
fifteen million U.S. Dollars (US15,000,000) from the date of this Charter until
the last day of the 2017 fiscal year;

(ii)
sixteen million U.S. Dollars (US16,000,000) during the 2018 fiscal year; and

(iii)
eighteen million U.S. Dollars (US18,000,000) thereafter.

Cash Balance means the unencumbered and otherwise unrestricted cash and cash
equivalents of Pangaea.

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Free Cash means, at any relevant time, the amount of the Cash Balance, freely
available for use by Pangaea
(d)
Tested on the last day of each fiscal quarter beginning from 1 April 2017,
Pangaea’s Consolidated Net Worth (as defined in clause 13.19(a) above) shall be
at least fifty million two hundred and fifty thousand U.S. Dollars
(US$50,250,000).

14
Vessel Undertakings

The undertakings in this clause 14 (Vessel Undertakings) apply from Delivery
until the end of the Charter Period.
14.1
Change of flag or register

The Charterer shall not and shall procure no Group Member or the Manager shall
change the State of Registration of the Vessel without the prior written consent
of the Owner (such consent not to be unreasonably withheld).
14.2
Change of classification

The Charterer shall not and shall procure no Group Member or the Manager shall
change the Vessel's Classification Society without the prior written consent of
the Owner (such consent not to be unreasonably withheld).
14.3
Classification and Repair

The Charterer will (and will procure that the Manager will) at all times on and
after the Delivery Date:
(a)
ensure that the Vessel is surveyed from time to time as required by the
Classification Society in which the Vessel is for the time being entered and
upon the Owner's request, supply to the Owner copies of all related survey
reports which have been issued;

(b)
maintain and preserve the Vessel in good working order and repair (including but
not limited to periodic dry-docking in accordance with Classification Society
rules), ordinary wear and tear excepted, and ensure that the Vessel maintains
the classification without any overdue notations and recommendations affecting
class;

(c)
procure that all repairs to or replacement of any damaged, worn or lost parts or
equipment shall be effected in accordance with the rules of the Classification
Society in which the Vessel is for the time being entered and in such manner
(both as regards workmanship and quality of materials) as not to materially
diminish the value of the Vessel;

(d)
not without the prior written consent of the Owner, remove or modify any
material part of the Vessel, any part or any other item of equipment installed
on the Vessel unless (i) such removal (in the case of the non-replacement of
such item or part) or modification does not materially diminish the value of the
Vessel or (ii) the part or item so removed is forthwith replaced by a suitable
part or item which is in the same condition as or better condition than the part
or item removed, is free from any Security Interest (other than any Permitted
Security Interests) or any right in favour of any person other than the Owner
and becomes on installation on the Vessel the property of the Charterer and
subject to any Security Interest constituted by the Security Documents, provided
that the Charterer may install and remove or modify equipment owned by a third
party if the equipment can be removed or modified without any risk of damage to
the Vessel or its value and doing so does not affect the class, flag or custody
transfer certification or, as the case may be, any such resulting damage is
repaired by the Charterer promptly after such removal or installation or
modification (as applicable);

(e)
not without the prior written consent of the Owner cause or permit to be made
any substantial change in the structure, machinery, equipment, control systems,
type or performance characteristics of the Vessel the effect of which would
materially diminish the value of, or change the main purpose of use of, or
classification of the Vessel and furthermore shall provide confirmation to the
Owner that such substantial change in structure, type or performance
characteristics of the Vessel will not result in a breach of any covenant under
this Charter;

(f)
maintain and keep up to date records in respect of:

(i)
any fuel loaded which is not in accordance with the specifications for the
Vessel; and

(ii)
all lubricating oil analysis;

(g)
ensure the Vessel complies with all laws, regulations and requirements
(statutory or otherwise) from time to time applicable to vessels registered
under the laws and flag of the State of Registration; and

(h)
not put the Vessel into the possession of any person for the purpose of work
being done upon it in an amount exceeding or likely to exceed one million and
five hundred thousand U.S. Dollars (US$1,500,000) (or the equivalent in any
other currency) unless that person has first given to the Owner on terms
satisfactory to the Owner a written undertaking not to exercise any lien on the
Vessel or its Earnings for the cost of such work or for any other reason.

14.4
Lawful and Safe Operation

The Charterer will (or will procure that the Manager will) at all times on and
after the Delivery Date:
(a)
not cause or permit the Vessel to be operated in any manner contrary to the
laws, regulations, treaties and conventions (and all rules and regulations
issued thereunder) from time to time applicable to the Vessel;

(b)
not cause or permit the Vessel to trade with or within the territorial waters of
any country in which her safety could reasonably be expected to be imperilled
without customarily required war insurance;

(c)
not cause or permit the Vessel to be employed in any manner which will or may
render her liable to requisition, confiscation, forfeiture, seizure, destruction
or condemnation as prize;

(d)
perform all obligations and comply with all laws (including, without limitation
Environmental Laws) applicable to the Charterer and/or the Vessel and use its
best efforts to ensure that the Vessel is not employed in any trade or business
which is forbidden by international law and not allow the Vessel to carry
illicit or prohibited goods (including but not limited to any nuclear waste or
material);

(e)
in the event of hostilities in any part of the world (whether war be declared or
not) ensure that the Vessel is not employed in carrying any contraband goods and
that she does not trade in any zone after it has been declared a war zone by any
authority or by the Vessel's war risks insurers unless the Vessel's insurers
shall have confirmed to the Charterer and the Owner that the Vessel is covered
under the Compulsory Insurances for the voyage(s) in question;

(f)
not do or permit to be done any act which might jeopardise the title, rights and
interests of the Owner in the Vessel and to the Charterer Security Assets and/or
knowingly omit or knowingly permit to be omitted to be done any act which might
prevent that title or those rights and interest from being jeopardised;

(g)
not charter the Vessel or permit the Vessel to serve under any contract of
affreightment with any foreign country or national of any foreign country which
would be contrary to applicable law or to the Charterer's knowledge, would
render any Transaction Document or the security conferred by the Security
Documents unlawful; and

(h)
take all necessary and proper precautions to prevent any infringements of the
Anti Drug Abuse Act of 1986 of the United States of America or any similar
legislation applicable to the Vessel in any jurisdiction in or to which the
Vessel shall be employed or located or trade or which may otherwise be
applicable to the Vessel and/or the Charterer and, if the Owner shall so
require, the Charterer shall enter into a "Carrier Initiative Agreement" with
the United States Customs Service and to procure that any such similar agreement
is maintained in full force and effect and performed by the Charterer.

14.5
Dry Docking and Repair of the Vessel

The Charterer will not (or will procure that the Manager will not) at any time
after the Delivery Date:
(a)
permit the Vessel to undergo any repairs, scheduled maintenance and/or any other
works which requires the Vessel to be dry docked, in any such case, other than
with a reputable shipyard; or

(b)
pledge the credit of the Owner or any Interested Party for any maintenance,
service, repairs, dry‑docking or modifications to, or changes or alterations in
the Vessel or for any other purpose whatsoever.

14.6
Arrests and Liabilities

The Charterer will (and will procure that the Manager will) at all times on and
after the Delivery Date:
(a)
pay and discharge when due and payable, all debts, damages, obligations and
liabilities whatsoever (other than those being contested in good faith or for
which adequate reserves have been made) which have given or may give rise to
liens on or claims enforceable against the Vessel;

(b)
notify the Owner promptly in writing of the levy of any distress on the Vessel
or her arrest, detention, seizure, condemnation as prize, compulsory acquisition
or requisition for title or use unless such arrest, detention, seizure has been
reversed or cancelled within fourteen (14) days of occurring;

(c)
(unless the Vessel is subject to the Compulsory Acquisition) take all measures
to obtain release of the Vessel as soon as is practicable or possible (and in
any event, within thirty (30) days of the relevant event or circumstance first
occurring or such longer period as the Charterer and the Owner may agree in
writing);

(d)
if the Vessel is subject to the Compulsory Acquisition, diligently exercise its
rights under law as a prudent owner of a vessel to ensure the return of the
Vessel (or if there is no reasonable prospect of such return of the Vessel, the
payment of fair compensation) as soon as reasonably practicable;

(e)
pay and discharge when due and payable all dues, taxes, assessments,
governmental charges, levies, fines and penalties lawfully imposed on or in
respect of the Vessel (other than those being contested in good faith by
appropriate proceedings); and

(f)
pay and discharge all other obligations and liabilities whatsoever payable by
the Charterer in respect of the Vessel or the Compulsory Insurances.

14.7
Environment

(a)
The Charterer shall (or shall procure that the Manager shall) at all times after
the Delivery Date comply in all material respects with all applicable
Environmental Laws and Environmental Approvals including, without limitation,
requirements relating to the establishment of financial responsibility and
obtain and comply in all material respects with all required Environmental
Approvals, which Environmental Laws and Environmental Approvals relate to it and
any of the Vessel or her operation or her carriage of cargo.

(b)
The Charterer shall (or shall procure that the Manager shall) at all times after
the Delivery Date pay due attention to the protection and conservation of the
environment in operating the Vessel including, but not limited to, giving due
consideration to such issues as air pollution and water pollution and industrial
waste treatment and the impact of the Vessel on the environment generally.

(c)
If the Vessel is to trade to the United States of America or Puerto Rico or
other countries or zones at which legal systems or policies in relation to oil
pollution are similar to those of the United States of America, the Charterer
shall obtain, prepare and always install on board the Vessel a Certificate of
Financial Responsibility or the like document or evidence of its financial
security or responsibility in respect of oil or other pollution damage as
required by any government, including federal, state or municipal or other
division or authority thereof, so that the Vessel will, without penalty or
charge, be lawfully able to enter, remain at, or leave any port, territorial or
contiguous waters of any country, state or municipality.

14.8
Payment of Outgoings and Evidence of Payments

The Charterer shall promptly:
(a)
pay and discharge all debts, charges, liabilities, dues and other outgoings in
respect of the Vessel, her earnings and the Compulsory Insurances when due and
payable;

(b)
keep proper books of account in respect of the Vessel and her earnings and
copies of such accounts to be provided to the Owner for inspection upon
reasonable request of the Owner, but no more than every twelve (12) months;

(c)
furnish to the Owner satisfactory evidence upon the Owner's request:

(i)
the wages, allotments and the insurance and pension contributions of the master
and crew are being promptly and regularly paid;

(ii)
all deductions from crew's wages in respect of any tax liability are being
properly accounted for; and

(iii)
the master has no claim for disbursements, other than those incurred by him in
the ordinary course of trading on the voyage then in progress.

14.9
Management

(a)
The Charterer will ensure that at all times after the Delivery Date the Vessel
is managed by the Charterer or the Manager.

(b)
The Charterer may only appoint or change the Manager with the prior written
approval of the Owner (such approval not to be unreasonably withheld).

(c)
The Charterer will procure that the management of the Vessel, whether by the
Charterer or by the Manager, will be in accordance with the practices, methods,
techniques and standards that are from time to time generally accepted and
adopted for use by international owners, operators and managers of vessels of
similar nature to the Vessel itself to manage, operate and maintain ships
similar to the Vessel in a lawful, efficient, economic and safe manner and,
without limiting the foregoing, in full compliance with the ISM Code and ISPS
Code.

(d)
[Intentionally Omitted]

(e)
The Charterer will ensure that at all times after the Delivery Date:

(i)
the Manager shall not terminate or materially vary the terms of the Vessel
Management Agreement without the prior written consent of the Owner; and

(ii)
the Manager shall not subcontract its responsibilities to the management and/or
operation of the Vessel, save that the Manager may sub-contract the technical
management of the Vessel to a manager approved by the Owner (such approval not
to be unreasonably withheld),

and any breach by the Manager of this paragraph (e) shall constitute a breach by
the Charterer.
(f)
On or prior to the date of the appointment of any Manager, the Charterer shall
provide to the Owner a certified copy of the duly executed Vessel Management
Agreement.

(g)
On or prior to the date of appointment of the Manager (and promptly following
any appointment of an alternative Manager in accordance with terms of
sub-paragraph (b) above), the Charterer shall procure that the Manager delivers
a duly executed Manager’s Undertaking to the Owner.

14.10
Charters

(a)
Upon request of the Owner (and such request to be made upon the Owner acting
reasonably), provide to the Owner any information requested by the Owner in
relation to any chartering arrangements entered into by the Charterer for the
Vessel.

(b)
During the term of such chartering arrangement entered into by the Charterer for
the Vessel, notify the Owner of any matters which might reasonably have the
effect of jeopardising any Security Interest or other interest of the Owner in
the Vessel.

(c)
In relation to any chartering arrangement entered into by the Charterer for the
Vessel, if an event of default (however so described therein) shall occur in
respect of such arrangement and be continuing under that chartering arrangement,
promptly notify the Owner of the steps that it is proposing and/or taking to
remedy such event of default and/or enforce the terms of such chartering
arrangement and/or recover possession of the Vessel, and thereafter the
Charterer shall take all such steps as are reasonably necessary or as the Owner
may require to ensure that the Vessel is so repossessed.

(d)
Sub-chartering of the Vessel

The Charterer shall ensure that during the Charter Period it does not:
(i)
agree to let or charter the Vessel under any demise charter;

(ii)
enter into any time or consecutive voyage charter in respect of the Vessel for a
term which exceeds, or which by virtue of any optional extensions may exceed,
twelve (12) months;

(iii)
enter into any charter in relation to the Vessel under which more than two (2)
months’ hire (or the equivalent) is payable in advance; and/or

(iv)
charter the Vessel otherwise than on a bona fide arm’s length terms.

14.11
ISM Code

(a)
The Charterer will deliver to the Owner a certified copy of a valid document of
compliance as required under the ISM Code as issued to the Charterer or the
Manager.

(b)
The Charterer shall at all times after the Delivery Date:

(i)
ensure that the Vessel remains, with effect from the Delivery Date (or such
later date as may be stipulated in the ISM Code) and for the remainder of the
Charter Period, subject to a safety management system in accordance with the ISM
Code;

(ii)
procure and maintain a valid and current safety management certificate for the
Vessel with effect from the Delivery Date (or such later date as may be
stipulated in the ISM Code) and for the remainder of the Charter Period;

(iii)
procure and maintain a valid and current document of compliance for the Manager
with effect from the Delivery Date (or such later date as may be stipulated in
the ISM Code) and for the remainder of the Charter Period and shall deliver to
the Owner on the Delivery Date (or such later date as aforesaid) a copy of a
valid safety management certificate and a valid document of compliance;

(iv)
immediately notify the Owner in writing of any known actual or threatened
withdrawal, suspension, cancellation or modification of the Vessel's safety
management certificate or of the Manager's document of compliance;

(v)
not without the prior consent of the Owner, change the identity of the Manager;
and

(vi)
ensure that the Manager shall comply with the ISM Code from the Delivery Date
(or such later date as may be stipulated in the ISM Code) for the remainder of
the Charter Period.

14.12
ISPS Code

(a)
The Charterer shall promptly deliver to the Owner:

(i)
evidence, in a form reasonably satisfactory to the Owner, that the Vessel is
subject to a ship security plan which the Charterer confirms complies with the
ISPS Code; and

(ii)
a certified copy of a valid International Ship Security Certificate for the
Vessel (if and to the extent required under the terms of the ISPS Code in
respect of the Vessel as at the Delivery Date).

(b)
The Charterer shall:

(i)
comply and be responsible for compliance by itself and by the Manager with the
ISPS Code; and

(ii)
ensure that:

(A)
the Vessel has a valid International Ship Security Certificate;

(B)
the Vessel's security system and its associated security equipment comply with
section 19.1 of Part A of the ISPS Code;

(C)
the Vessel's security system and its associated security equipment comply in all
respects with the applicable requirements of Chapter XI-2 of the International
Convention for the Safety of Life at Sea (SOLAS) and Part A of the ISPS Code;

(D)
an approved ship security plan is in place; and

(E)
immediately notify the Owner in writing of any known actual or threatened
withdrawal, suspension, cancellation or modification of the Vessel's
International Ship Security Certificate.

14.13
Notice of mortgage

(a)
The Charterer shall place and retain a properly certified copy of the Vessel
Mortgage (provided by the Owner), which shall from part of the Vessel’s
documents, on board the Vessel with its papers and cause such certified copy of
the Vessel Mortgage to be exhibited to everyone having business with the Vessel
which might create or imply any commitment or Security Interest on or in respect
of the Vessel (other than a lien for crew’s wages and salvage) and to any
representative of the Owner and shall place and keep prominently displayed in
the navigation room and the master’s cabin of the Vessel a framed printed notice
in play type reading as follows:

“Notice of Mortgage”
This Vessel is covered by a first priority Panamanian mortgage to Sumitomo
Mitsui Finance and Leasing Co., Ltd. of 1-3-2, Marunouchi, Chiyoda-ku, Tokyo
100-8287, Japan granted by the owner thereof Nicole Navigation S.A. of Paseo del
Mar and Pacific Avenues, Costa del Este, MMG Tower, 23rd Floor, Panama City,
Republic of Panama pursuant to the terms of the said mortgage a certified copy
of which is preserved with the Vessel’s papers. Under the terms of the said
mortgage neither the Owner nor any charterer nor the master of this Vessel nor
any other person has any right, power or authority to create, incur or permit to
be imposed upon this Vessel any lien, commitments or encumbrances whatsoever
other than for crew’s wages and salvage”
(b)
The Charterer agrees that, except as permitted under this Charter, neither it
nor any other person has any right, power or authority to create, incur or
permit to be imposed upon the Vessel any lien whatsoever other than for crew's
wages and salvage.

14.14
Compliance undertakings

The Charterer further undertakes with the Owner that it shall and shall procure
the Manager shall:
(a)
duly and punctually perform each of its obligations under the Transaction
Documents to which the Charterer is a party; and

(b)
not do or permit to be done any act or thing which might jeopardise the title,
rights and interest of the Owner in the Vessel and/or omit or permit to be
omitted to be done any act which might prevent that title and those rights and
interest from being jeopardised.

15
Documents

The undertakings in this clause 15 apply from the Delivery Date until the end of
the Charter Period.
15.1
Documents – minimum standards

(a)
The Charterer shall maintain on an interrupted basis all certificates, records,
logs, manuals, technical data and documents which are required to be maintained
in respect of the Vessel by applicable laws.

(b)
All certificates, records, logs and documents kept or maintained by the
Charterer with the Vessel will:

(i)
be maintained in the English language and any other language as may be agreed by
the Owner; and

(ii)
conform with applicable requirements of applicable law.

(c)
The Charterer will procure that all certificates, records, logs, manuals,
technical data and document with respect to the Vessel are kept in a secure
location.

(d)
The Charterer shall ensure that all documents and registrations required
hereunder and at law in respect of the Vessel (including but not limited to the
Vessel's registration under the registry of the State of Registration,
insurances and operations) are prepared by the Charterer in sufficient time and
where the signature, approval or any other action of or by the Owner is
required, the Charterer shall notify the Owner of the same and prepare and
provide any required documentation with sufficient time to allow the Owner to
approve, execute and return such documentation to the Charterer for processing
in a timely fashion.

16
Ownership and Registration

The undertakings in this clause 16 apply from Delivery until the end of the
Charter Period.
16.1
Title

The Charterer shall have no right, title or interest in or to any part of the
Vessel except the right to charter the Vessel in accordance with the terms and
conditions of this Charter.
16.2
Protection of Owner

The Charterer shall use all efforts to make clear to third parties that title to
the Vessel is held by the Owner in circumstances and on occasions where the
ownership of the Vessel may be relevant.
16.3
Protection of Rights

The Charterer will, upon the Owner's request, in the event of any enactments or
provisions being made or becoming operative relating to recognition of rights in
Vessel and which may apply to the Vessel, promptly do and join with the Owner
and, if appropriate the Finance Parties in doing all such acts or things which
are necessary to perfect recognition of the title, rights and interest of the
Owner and all other Interested Parties in respect of the Vessel.

17
Insurances

The undertakings in this clause 17 apply from Delivery until the end of the
Charter Period. The Charterer shall insure and keep the Vessel insured, free of
cost and expense to the Owner, in the names of the Owner and Charterer (but
without liability on the part of the Owner for premiums or calls) as follows:
17.1
Required Insurances

(a)
The Charterer shall, at all times on and after the Delivery Date keep the Vessel
insured against Hull and Machinery (including freight interest) and if
applicable, Increased Value risks for an agreed value of at least the Required
Insurance Amount (or more at the Charterer's discretion) in U.S. Dollars as set
out in paragraph 1 of Schedule 4 through first class and internationally
recognised reputable brokers and with first class and internationally
recognised, reputable and creditworthy underwriters or insurance companies, in
each case, approved by the Owner, and by policies in form and content approved
by the Owner (such approval shall be deemed to be continuing and valid until the
Owner determines its approval is no longer valid and notifies the same to the
Charterer at which time the Charterer will again be required to obtain as soon
as possible the relevant approvals from the Owner).

(b)
The Charterer shall, at all times on and after the Delivery Date keep the Vessel
insured in accordance with paragraph 2 of Schedule 4 against war risks
(including risk of mines and all risks whether or not regarded as war risks,
which are included in the London Blocking and Trapping Addendum and Missing
Vessel Clause) for an agreed value of at least the Required Insurance Amount
either:

(i)
with first class and internationally recognised, reputable and creditworthy
underwriters or insurance companies approved by the Owner and by policies in
form and content approved by the Owner; or

(ii)
by entering the Vessel in a war risks association approved by the Owner.

(c)
The Charterer shall, at all times on and after the Delivery Date keep the Vessel
entered in the names of the Owner, Charterer and the Manager (as applicable) as
an additional entered member, each as their interests may appear, in a
protection and indemnity association as approved by the Owner in respect of the
Vessel's full value and tonnage and on the basis set out in paragraph 3 of
Schedule 4 against all risks as are normally covered by such protection and
indemnity association (including pollution risks and the proportion (if any) not
recoverable in case of collision under the running down clause in the Vessel's
Hull Machinery Policy). Such cover is to be for:

(i)
the highest amount then available in the insurance market for vessels of a
similar age and type as the Vessel, but, in relation to liability for oil
pollution, in a minimum amount of not less than one billion U.S. Dollars
(US$1,000,000,000) or such other amount as is normally covered by such
protection and indemnity association as specified in paragraph 3 of Schedule 4
as shall at any time be comprised in the basic entry of the Vessel with either a
protection and indemnity association which is a member of the "International
Group" of protection and indemnity associations (or any successor organisation
designated by the Owner) or the International Group (or such successor
organisation) itself; or

(ii)
if the International Group (or any such successor) ceases to exist or ceases to
provide or arrange any cover for pollution risks (or any supplemental cover for
pollution risks over and above that afforded by the basic entry of the Vessel
with its protection and indemnity association), such aggregate amount of cover
against pollution risks as shall be available on the open market and by basic
entry with a protection and indemnity association for ships of the same type,
size, age and flag as the Vessel.

(d)
The Owner may take out Innocent Owner’s Insurance or mortgagee's interest
insurance, at the cost of the Charterer with a first class, internationally
reputable, credit-worthy insurers, re-insurers or brokers on terms acceptable to
the Owner and the Charterer shall pay all costs and expenses (including calls on
premia, contributions and other amounts payable by the Owner or the Lender (as
applicable) to effect and maintain such insurance) on demand from the Owner to
the relevant broker or insurer.

(e)
The Charterer shall, on or before the Delivery Date, obtain a confirmation
addressed to the Owner, from each broker, insurer (if any insurances are placed
direct and not through a broker) and the manager of club or association
concerned with the Compulsory Insurances of the Vessel, that:

(i)
the relevant cover is in effect or will be as of the Delivery Date in effect
(including by the issue of the cover note);

(ii)
if and to the extent that the Vessel is insured under any fleet policy they will
restrict their lien for unpaid premiums under any fleet policy to unpaid
premiums in respect of the Vessel only;

(iii)
they will issue a letter of undertaking substantially in the form provided for
in the Security Assignment (or in such other form as may be reasonably
acceptable to the Owner) or, in the case of the Protection and Indemnity
Insurance, in the standard form of the protection and indemnity club or
association (provided it is acceptable to the Owner, acting reasonably) within
five (5) Business Days following the Delivery Date or such other longer period
as the Owner may agree in writing;

(iv)
they will accept an endorsement of a loss payable clause on the policies
substantially in the form provided for in the Security Assignment (in the case
of brokers and insurers other than clubs) or will note the interest of the Owner
(on behalf of the Finance Parties) in the entry for the Vessel by way of a loss
payable clause in their current standard form (in the case of clubs); and

(v)
they are not aware of any mortgage, charge, assignment or other Security
Interest affecting the Compulsory Insurances with which they are concerned.

(f)
The Charterer shall at all times on and after the Delivery Date, maintain in
full force and effect any other insurances required to be maintained by the
Charterer under the provisions of this Charter in accordance with the terms
hereof (provided that the maintenance of such insurances shall not allow the
Charterer to derogate from its other obligations under this clause 17.1).

(g)
The Charterer shall at all times on and after the Delivery Date, maintain in
full force and effect insurances against all other risks not specified in this
clause 17.1 and which are customarily insured against by leading operators of
vessels of the same age and type (in accordance with then current industry
practice and taking into account the Vessel's trading area).

(h)
The Owner shall procure that all the insurances required under this clause 17.1
shall be maintained through first class and internationally recognised,
reputable and creditworthy brokers, underwriters, insurance companies, clubs or
associations (as applicable) in each case, approved by the Owner (acting
reasonably).

17.2
Other Insurances – Innocent Owner’s Insurance and Innocent Owner’s Additional
Perils Pollution Liability Insurance or mortgagee’s interest insurance and
mortgagee’s interest additional perils insurances

(a)
The Charterer undertakes to pay to the Owner on demand all premiums and other
amounts payable in effecting and maintaining on behalf of the Finance Parties
any of the following insurances in such amounts, on such terms, through such
insurers and generally in such manner as the Finance parties may from time to
time consider appropriate: an Innocent Owner’s Additional Perils Pollution
Insurance or a mortgagee’s interest additional perils (pollution) policy and an
Innocent Owner’s Insurance or a mortgagee’s interest insurance, in each case for
an amount equal to one hundred and twenty per cent (120%) of the Owner’s equity
or the Charterhire Principal as the start of the applicable policy year.

(b)
Without limiting the obligations of the Charterer in paragraph (a) above, the
owner hereby agrees, that prior to the effecting or renewal of the insurances
noted in paragraph (a) above, it shall provide the Charterer with details of the
proposed cover and shall afford the Charterer opportunity to propose within
fifteen (15) Business Days from receipt of such notification, insurances of an
equivalent nature and coverage from another source provided always that the
Owner shall have sole discretion (acting reasonably) as to the insurances to be
taken out in respect of the insurances noted in paragraph (a) of this clause
17.2.

(c)
For the avoidance of doubt, the Charterer will take out all and any other
insurances required to be taken out as a matter of law.

17.3
Proposed Changes

Notwithstanding the provisions of clause 17.1 (Required Insurances), it is
agreed that any proposed change in the provisions of Schedule 4 which may be
required either by the Charterer or by the Owner due to any change in market
practice or capacity or otherwise shall be discussed, in good faith, by the
Owner and the Charterer at the relevant time with a view to agreeing revisions
to such provisions so as to satisfy the reasonable requirements of the Owner and
the Finance Parties with regard to insurances in light of such change in
circumstances. If the Owner and the Charterer are unable to so agree, the Owner
(acting reasonably) may require the Charterer to effect and keep in force
separate insurances, entries in a protection and indemnity association or club
and, if it the Owner deems necessary or expedient, war risks cover in respect of
the Vessel in the amounts required under this Charter and the Security
Assignment.
17.4
Undertakings

Without prejudice to its obligations under clause 17.1 (Required Insurances),
the Charterer shall:
(a)
(i) not without the prior consent of the Owner alter any material part of
Compulsory Insurances in any respect, (ii) prior to altering any non-material
part of the Compulsory Insurances in any respect inform the Owner of the
proposed alteration(s) and (iii) not make, do, consent or agree to any act or
omission which would or might render any Compulsory Insurances invalid, void,
voidable or unenforceable or render any sum paid out under any Compulsory
Insurances repayable in whole or in part;

(b)
not cause or permit the Vessel to be operated in any way inconsistent with the
provisions or warranties of, or implied in, or outside the cover provided by,
any Compulsory Insurances or to be engaged in any voyage or to carry any cargo
not permitted by the Compulsory Insurances without first covering the Vessel in
the Required Insurance Amount or otherwise for an amount approved by the Owner
in US$ or another approved currency with approved insurers;

(c)
duly and punctually pay all premiums, calls, contributions or other sums of
money from time to time payable in respect of any Compulsory Insurance;

(d)
renew all Compulsory Insurances at least seven (7) days or within such shorter
period as the Owner may agree in writing before the relevant policies or
contracts or entries expire and procure that the approved brokers and/or war
risks and protection and indemnity clubs and associations shall confirm in
writing to the Owner (and provide certificates evidencing such replacement or
renewal) no later than seven (7) days after each such policy, contract or entry
is replaced or renewed;

(e)
forthwith upon the effecting of any Compulsory Insurance, give written notice of
the insurance to the Owner stating the full particulars (including the dates and
amounts) of the insurance, and upon the request of the Owner produce the
receipts for each sum paid by it pursuant to paragraph (c) above;

(f)
provide to the Owner on request certified copies of all documentation relating
to the Compulsory Insurances in the Charterer's or its brokers' possession and
immediately upon such documentation being issued, including all policies, slips,
cover notes and certificates of entry;

(g)
not settle, compromise or abandon any claim in respect of any Total Loss unless
the Owner is satisfied that such release, compromise or abandonment will not
prejudice any of its or the Finance Parties' interests under or in relation to
the Transaction Documents;

(h)
arrange for the execution and delivery of such guarantees as may from time to
time be required by any protection and indemnity or war risks club or
association;

(i)
procure that the interests of the Owner are noted on all policies of insurance;

(j)
procure that a loss payee and notice of cancellation provision substantially in
the form scheduled to the Security Assignment and reflecting the provisions of
clause 17.5 (Application of Insurance Proceeds) below is endorsed on all
policies of insurance and certificates of entry;

(k)
obtain from the relevant insurance brokers and/or insurers and/or P&I Club
letters and undertakings substantially in the form scheduled to the Security
Assignment (or such other form as may be acceptable to the Owner);

(l)
in the event that the Charterer receives payment of any moneys under the
Compulsory Insurances, save as provided in clause 17.5 below and the loss
payable clauses scheduled to the Security Assignment, forthwith pay over the
same (without deduction or withholding) to the Owner or to its order and until
paid over such moneys shall be held in trust for the Owner by the Charterer. In
the event the Charterer is unable to hold such moneys on trust for the Owner or
there is a failure of such trust or the efficacy of such trust is contested or
challenged, the Charterer will promptly pay an amount equal to such moneys to
the Owner or to its order;

(m)
take all necessary action and comply with all requirements which may from time
to time be applicable to the Compulsory Insurances (including the payment of any
additional premiums or calls) and ensure that the Compulsory Insurances are:

(i)
not cancelled or made subject to any exclusions or qualifications to which the
Owner has not given its prior written consent and do not become voidable; and

(ii)
are otherwise maintained on terms and condition from time to time approved in
writing by the Owner (acting reasonably);

(n)
not do, consent to, or permit any act or omission which might invalidate or
render unenforceable the whole or any part of the Compulsory Insurances and not
(without first obtaining the consent of the applicable insurers to such
employment or operation and complying with such requirements as to extra premium
or otherwise as such insurers may prescribe and covering the Vessel) employ or
operate the Vessel or suffer the Vessel to be employed or operated otherwise
than in conformity with the terms of the Compulsory Insurances;

(o)
provide to the owner, at the time of each such communication, copies of all
material written communications between the Charterer and the Charterer’s
brokers (if any) or, as the case may be, the relevant insurers and approved
protection and indemnity club or association which relates to declarations
required to be given by the Finance Parties, payment of additional premia or
calls, renewal of the Compulsory Insurances or any material amendment to the
terms and conditions relating to such Compulsory Insurances;

(p)
provide to the Owner at any time any claim is made in excess of one million U.S.
Dollars (US$1,000,000) under any Compulsory Insurance with reasonable details of
such claims;

(q)
not create or permit to exist any Security Interests over or in respect of the
Compulsory Insurances save for any Security Interests in favour of the Owner
and/or Finance Parties and save also for any brokers' (if any) or, as the case
may be, the relevant insurer's right of set off and lien for unpaid premiums to
the extent permitted by this clause 17; and

(r)
without the prior written consent of the Owner (not to be unreasonably withheld
or delayed) not permit any person (other than the Owner, Charterer and the
Manager) to be added as an additional assured under any of the Compulsory
Insurances.

17.5
Application of Insurance Proceeds

The Charterer shall and shall procure the Manager shall:
(a)
apply all amounts receivable under the Compulsory Insurances which are paid to
the Charterer or to its order in accordance with the loss payable clauses (where
the Compulsory Insurances have been assigned to the Owner or any Finance Party)
in repairing all damage and/or in discharging the liability in respect of which
such amounts have been received; and

(b)
do all things necessary and provide all documents, evidence and information to
enable the Owner to collect or recover any moneys which shall at any time become
due in respect of the Compulsory Insurances.

Unless otherwise agreed by the Owner in writing, all Insurance Proceeds deriving
from a Total Loss shall be applied in accordance with clause 18.3 (Payment
following Total Loss). Once the Total Loss Amount has been irrevocably paid in
accordance with clause 18.3 (Payment following Total Loss), any remainder shall
be payable to the Charterer. The Charterer shall procure this is correctly
reflected in all loss payable clauses under the Compulsory Insurances and where
the Manager is an assured under the Compulsory Insurances the Charter shall
procure the Manager's written agreement (in form and substance satisfactory to
the Owner) to the form of the loss payable clauses and the payment of any
insurance proceeds in accordance with such loss payable clauses.
17.6
Declarations And Returns

(a)
Where it is a requirement of any applicable law or of the Compulsory Insurances
that any declarations are made or any certificates, returns or forms filed with
any Government Entity or any of the insurers for the Vessel from time to time in
connection with the Vessel, the Charterer shall:

(i)
promptly (and, within any applicable time limits) complete and submit to the
relevant Government Entity or (as the case may be) the relevant insurers all
such declarations, certificates, returns and forms; and

(ii)
to the extent that clause 17.7 (Evidence of Oil Pollution and Special Cover)
does not apply thereto, supply to the Owner promptly upon request copies of any
or all of the foregoing.

(b)
If any such declaration, certificate, return or form is required to be executed
or delivered by the Owner, the Charterer shall prepare such declaration,
certificate, return or form and forward the same promptly to the Owner for
review and execution together with a brief explanation of the reason why such
declaration is required, and the Owner shall promptly execute such declaration,
certificate, return or form and deliver it to the Charterer or to its order so
long as it is lawful for it to do so.

17.7
Evidence of Oil Pollution and Special Cover

The Charterer shall provide to the Owner copies of:
(a)
all declarations to the protection and indemnity association in which the Vessel
is entered;

(b)
a civil liability convention certificate; and

(c)
any certificate of financial responsibility (or equivalent certification
required in respect of liability insurance cover otherwise than for oil
pollution risks) required by this Charter,

in each case in respect of cover for oil pollution risks and such other
information and documents relating to oil pollution risks or insurances as the
Owner may from time to time reasonably request.
17.8
Wreck Removal

In the event of the Vessel becoming a wreck or obstruction to navigation, the
Charterer shall (in addition to any other obligation it may have under the
Transaction Documents to which it is a party) indemnify and hold harmless the
Owner and the Finance Parties against all costs, expenses, payments, charges,
losses, demands, any liabilities, claims, actions, proceedings (whether civil or
criminal) penalties, fines, damages, judgments, orders or other sanctions which
may be incurred by, or made or asserted against, any of the Owner and the
Finance Parties by reason that the Vessel shall have become a wreck or
obstruction to navigation including in respect of the removal or destruction of
the wreck or obstruction under statutory powers but only to the extent that such
has not been recovered from the Vessel's insurers.
17.9
Power of the Owner to insure

(a)
If the Charterer fails to effect and keep in force Compulsory Insurances in
accordance with this Charter, it shall be permissible, but not obligatory, for
the Owner (on behalf of the Finance Parties) to effect and keep in force
insurance or insurances in the amounts required under this Charter and the
Security Assignment and entries in a protection and indemnity association or
club and, if it deems necessary or expedient to it, to insure the war risks upon
the Vessel, and the Charterer will reimburse the Owner for the costs of so
doing.

(b)
The Charterer will indemnify and keep the Owner and the Lender indemnified
against all losses reasonably incurred in connection with the exercise of the
powers contained in this clause 17.9 or the taking out, maintaining and/or
renewal of Compulsory Insurances.

18
Risk of Loss; Total Loss

18.1
Risk of Loss

(a)
Commencing on the Delivery Date and continuing until the end of the Charter
Period, the Charterer assumes the risk of loss or damage to the Vessel or any
part thereof or of any Total Loss. No Total Loss will relieve the Charterer from
its obligations hereunder.

(b)
The Owner will have no obligation to supply to the Charterer a replacement
vessel following the occurrence of a Total Loss.

18.2
Notification of Total Loss

The Charterer will promptly notify the Owner of the occurrence or possible
occurrence of a Total Loss as soon as they become aware of it.
18.3
Payments following Total Loss

(a)
Notwithstanding the occurrence of a Total Loss, the Charterer will continue to
pay Charterhire on the days and in the amounts specified by this Charter up to
and including the date on which the Owner receives the amounts specified in
clause 18.3(b).

(b)
In the event of a Total Loss of the Vessel, if the Owner has not irrevocably
received an amount equal to the Total Loss Amount from the Insurance Proceeds by
the Total Loss Payment Date, the Charterer shall within two (2) Business Days of
the Total Loss Payment Date pay to the Owner an amount equal to Total Loss
Amount minus any Insurance Proceeds irrevocably received by the Owner.

The Total Loss Amount shall equal the Accelerated Charterhire Amount with all
values being calculated on the Total Loss Payment Date.
(c)
The Owner:

(i)
shall, upon irrevocable receipt of the Total Loss Amount in accordance with
paragraph (b) above, reassign all its interests in the Charterer Security Assets
to the Charterer and shall cause the Finance Parties to release and reassign
their interests in the Charterer Security Assets and the Vessel, including, as
may be necessary, by issuing notices to the Charterer and underwriters and
insurance brokers so as to procure that all Insurance Proceeds are paid directly
to the Charterer or to its order; and

(ii)
provide all necessary assistance and evidence as may be reasonably required by
the Charterer (and at the Charterer's cost) to enable the Charterer to prove for
claims and pursue proceedings against the insurers in relation to the recovery
of Insurance Proceeds arising from the Total Loss. The Owner shall use
reasonable endeavours to provide such assistance prior to receipt of the Total
Loss Amount.

(d)
Upon the Owner irrevocably receiving all sums due and payable under
clause18.3(c), the leasing of the Vessel under this Charter will cease and this
Charter shall be cancelled and the Charterer, Pangaea and the Owner shall be
free from any further obligations or liabilities to each other pursuant to the
Transaction Documents to which the Charterer or Pangaea is a party.

18.4
Requisition

During any requisition for use or hire of the Vessel which does not constitute a
Total Loss:
(a)
the Charterhire and other amounts payable under this Charter will not be
suspended or abated either in whole or in part, and the Charterer will not be
released from any of its other obligations under this Charter;

(b)
the Charterer will, as soon as practicable after the end of any such
requisition, cause the Vessel to be put into the condition required by this
Charter; and

(c)
the Charterer will be entitled to all compensation payable by the requisitioning
authority in respect of the Vessel arising during the period of requisition
unless a Termination Event has occurred, in which case any such amount shall be
held in trust for the Owner and applied towards any and all sums payable by the
Charterer under the Charter.

19
Sale and Purchase of the Vessel

19.1
Purchase Obligation

The Charterer shall purchase the Vessel from the Owner for the Purchase
Obligation Price on the final Payment Date.
19.2
Terms of Sale

The sale of the Vessel to the Charterer shall be effected by the execution of a
bill of sale and a protocol of delivery and acceptance substantially in the same
form as the Bill of Sale and Protocol of Delivery except for factual details and
as the Owner may otherwise agree between the Owner and the Charterer and shall
be subject to the following conditions:
(a)
the Vessel will be sold to the Charterer in the condition and at the place which
it is located at the time of title transfer;

(b)
the Vessel sold under this clause 19 will be delivered "as is, where is, and
with all faults", the Charterer agrees and acknowledges that the Owner and any
Finance Party will have no liability in relation to, and has not nor will be
deemed to have made or given, any conditions, warranties or representations,
express or implied, whether arising by law or otherwise with respect to the
Vessel, including but not limited to it being free of liens, Security Interests
(save for the Security Interests created pursuant to the Transaction Documents)
or defects (whether latent or apparent), the description, merchantability,
satisfactory quality, suitability, construction, seaworthiness, condition,
eligibility for any particular trade, operation, fitness for any use or purpose,
value, state, condition, appearance, safety, design or operation of any kind or
nature of the Vessel or any part thereof or any obligation, liability, right,
claim or remedy in tort, whether or not arising from the Owner's or any other
party's negligence, actual or imputed, or any obligation, liability, right,
claim or remedy for loss of or damage to the Vessel, for any liability of the
Charterer to any third party, or for any other direct or indirect, incidental or
consequential damages. The Charterer hereby irrevocably and unconditionally
waives all its rights in respect of any condition, warranty or representation,
express or implied, on the part of the Owner and any Finance Party and all
claims against the Owner and any Finance Party howsoever and whenever arising at
any time in respect of or out of, in each case, the condition, operation,
sub-chartering or performance of the Vessel (including, without limitation, the
seaworthiness or otherwise of the Vessel);

(c)
any mortgage or other Security Interest created by the Owner or any other person
over the Vessel and the Charterer Security Assets shall, subject to the
satisfaction in full of the all amounts owing by the Charterer under the
Transaction Documents, be fully discharged (at the expense of the Charterer)
upon payment of the Purchase Obligation Price; and

(d)
the Charterer agrees to waive all warranties, representations, guarantees and
remedies, express or implied, arising by law or otherwise (including any
obligation of the Owner with respect to suitability for any purpose,
merchantability or consequential damage) in respect of the Vessel and any
equipment.

19.3
Upon irrevocably receiving the Purchase Obligation Price:

(a)
the Owner shall transfer and/or (as applicable) reassign all its interests in
the Vessel and the Charterer Security Assets to the Charterer and shall cause
the Finance Parties to release, transfer and/or reassign any interests they may
have in the Vessel, the Charter and the Charterer Security Assets (as relevant),
including, as may be necessary, by issuing notices to the Charterer and
underwriters and insurance brokers; and

(b)
the leasing of the Vessel under this Charter will cease and this Charter shall
be cancelled and the Charterer, Pangaea and the Owner shall be free from any
further obligations or liabilities to each other pursuant to the Transaction
Documents to which the Charterer or Pangaea is a party.

For the avoidance of doubt, sub-clauses (a) and (b) shall apply where prior to
the final Payment Date all Charterhire Principal together with all other amounts
owing or due and payable to the Owner by the Obligors under the Transaction
Documents have been irrevocably paid to the Owner.

20
Termination Events

Each of clause 20.1 (Non-payment) to clause 20.22 (Termination or Amendment of
Transaction Documents) describes circumstances which constitute a Termination
Event for the purpose of this Charter (whether any such event shall be voluntary
or involuntary or come about or be effected by operation of law or pursuant to
compliance with any judgment, decree or order of any court or order or
regulation of any Governmental Entity).
The Owner and the Charterer agree that it is a fundamental term and condition of
this Charter that no Termination Event occurs and that the occurrence of any
Termination Event which is continuing constitutes a repudiatory breach of this
Charter.
Clause 20.24 (Acceleration, Termination and Repossession) addresses the rights
of the Owner after the occurrence of a Termination Event.
20.1
Non-payment

Any Obligor does not pay on the due date any amount payable pursuant to a
Transaction Document to which it is party at the place at and in the currency in
which it is expressed to be payable, unless the failure to pay is caused by
administrative or technical error and such payment is made within three (3) days
after the due date.
20.2
Insurances

(a)
The Compulsory Insurances of the Vessel are not placed and kept in force in the
manner required by this Charter and the other Transaction Documents.

(b)
Any insurer either:

(i)
cancels any such Compulsory Insurances; or

(ii)
disclaims liability under them by reason of any mis-statement or failure or
default by any person.

20.3
[Intentionally Omitted]

20.4
Other Obligations

Any Obligor does not comply with any provision of the Transaction Documents to
which it is a party, including without limitation, the relevant provisions under
this Charter (other than those mentioned in clause 20.1 (Non-payment)) and if
capable of remedy, such non-compliance remains unremedied to the satisfaction of
the Owner fourteen (14) days after the Owner notifies the Charterer of such
non-compliance or if earlier, the date the Charterer became aware of such
non-compliance.
20.5
Misrepresentation

Any representation or statement made or deemed to be made by any Obligor in the
Transaction Documents to which it is a party or any other document delivered by
or on behalf of any Obligor under or in connection with any Transaction Document
is or proves to have been incorrect or misleading when made or deemed to be made
and if capable of remedy, such misrepresentation remains unremedied to the
satisfaction of the Owner fourteen (14) days after the Owner notifies the
Charterer of such misrepresentation or if earlier, the date the Charterer became
aware of such misrepresentation.
20.6
Cross Default

(a)
Any Financial Indebtedness of any Obligor is not paid when due nor within any
originally applicable grace period.

(b)
Any Financial Indebtedness of any Obligor is declared to be or otherwise becomes
due and payable prior to its specified maturity as a result of a termination
event or an event of default (however described).

(c)
Any commitment for any Financial Indebtedness of any Obligor is cancelled or
suspended by a creditor of any Obligor as a result of a termination event or an
event of default (however described).

(d)
Any creditor of any Obligor becomes entitled to declare any Financial
Indebtedness of any Obligor due and payable prior to its specified maturity as a
result of a termination event or an event of default (however described).

(e)
The counterparty to a Treasury Transaction entered into by any Obligor becomes
entitled to terminate that Treasury Transaction early by reason of a termination
event or an event of default (however described),

provided that if the aggregate relevant Financial Indebtedness for Obligors in
respect of all the events listed in paragraphs (a) to (d) above equals less than
two million and five hundred thousand U.S. Dollars (US$ 2,500,000) or its
equivalent in any other currency in any one financial year for that Obligor,
there shall be no Termination Event under this clause 20.6.
20.7
Insolvency

(a)
Any Obligor is unable or admits inability to pay its debts as they fall due, or
is deemed to, or is declared to, be unable to pay its debts under applicable
law, suspends making payments on any of its debts or, by reason of actual or
anticipated financial difficulties, commences negotiations with one or more of
its creditors with a view to general rescheduling all or part of its
indebtedness.

(b)
The value of the assets of any Obligor is less than its liabilities (taking into
account contingent and prospective liabilities).

(c)
A moratorium is declared in respect of any indebtedness of any Obligor. If a
moratorium occurs, the ending of the moratorium will not remedy any Termination
Event caused by that moratorium which is continuing.

20.8
Insolvency Proceedings

Any corporate action, legal proceedings or other procedure or step is taken in
relation to:
(a)
the suspension of payments, a moratorium of any indebtedness, winding-up,
dissolution, administration, provisional supervision or reorganisation (by way
of voluntary arrangement, scheme of arrangement or otherwise) of any Obligor;

(b)
a composition, assignment or arrangement with any creditor of any Obligor;

(c)
the appointment of a liquidator, receiver, administrator, administrative
receiver, compulsory manager, provisional supervisor or other similar officer in
respect of any Obligor or any of its assets (including the directors of any
Obligor requesting a person to appoint any such officer in relation to it or any
of its assets);

(d)
enforcement of any Security Interest over any assets of any Obligor, or

(e)
any analogous procedure or step is taken in any jurisdiction.

This clause 20.8 shall not apply to any winding-up petition (or analogous
procedure or step) which in the opinion of the Owner is frivolous or vexatious
and is discharged, stayed or dismissed within fourteen (14) days of
commencement.
20.9
Creditors' Process

(a)
Any expropriation, attachment, sequestration, distress, execution or analogous
process affects any asset or assets of any Obligor causing a Material Adverse
Effect and is not discharged within fourteen (14) days.

(b)
Any judgment or order for an amount is made against any Obligor causing a
Material Adverse Effect and is not stayed or complied with within seven (7)
days.

20.10
Unlawfulness and invalidity

(a)
It is or becomes unlawful for any Obligor to perform any of its obligations
under the Transaction Documents or any Security Interest created or expressed to
be created or evidenced by the Charterer Documents ceases to be effective.

(b)
Any obligation or obligations of any Obligor under any Transaction Document is
not (subject to the Legal Reservations) or ceases to be legal, valid, binding or
enforceable and the cessation individually or cumulatively materially and
adversely affects the interests of the Owner or the Finance Parties under the
Transaction Documents.

(c)
Any Charterer Document or any Security Interest created or expressed to be
created or evidenced by the Transaction Documents ceases to be in full force and
effect or is any way imperilled or jeopardised (unless the Charterer shall
forthwith provide alternative security acceptable to the Owner) or is alleged by
a party to it (other than the Owner or a Finance Party) to be ineffective for
any reason.

(d)
Any Charterer Document does not create legal, valid, binding and enforceable
security over the assets purported to be charged under that Charterer Document
or the ranking or priority of such security is adversely affected.

(e)
Any governmental authority or agency authorisation necessary for the validity,
enforceability or performance of any Charterer Document or any agreement or
instrument required under any Charterer Document or for the admissibility in
evidence of any Charterer Document is revoked, is not issued or renewed on time,
or ceases to remain in full force and effect.

20.11
Sanctions

Any Group Member:
(a)
becomes a Prohibited Person or becomes owned or controlled by, or acts directly
or indirectly on behalf of, a Prohibited Person or any of such persons becomes
the owner or controller of a Prohibited Person; or

(b)
fails to comply with Sanctions

20.12
Bribery

Any Group Member or any of their respective directors, officers, employees,
representatives or agents thereof shall be charged with or prosecuted for a
criminal offence to:
(a)
commit, or attempt or conspire to commit, Bribery; or

(b)
aid, abet or authorise Bribery by any other person; or

(c)
request, receive, accept, or attempt to request, receive or accept any undue
pecuniary or other advantage offered, given or promised by any person as
Bribery.

20.13
Cessation of Business

Any Obligor suspends or ceases or threatens to suspend or cease to carry on its
business.
20.14
Nationalisation or Expropriation

The authority or ability of any Obligor to conduct its business is limited or
wholly or substantially curtailed by any seizure, expropriation,
nationalisation, intervention, restriction or other action by or on behalf of
any governmental, regulatory or other authority or any other person or any
Government Entity acquires (whether compulsorily or otherwise and whether or not
for fair compensation) any Obligor or all or substantially all of that person's
assets.
20.15
Repudiation

Any Obligor rescinds or purports to rescind or repudiates or purports to
repudiate a Transaction Document or evidences an intention to rescind or
repudiate a Transaction Document.
20.16
Litigation

Any litigation, alternative dispute resolution, arbitration or administrative
proceeding is taking place, or threatened against any Obligor or any of its
assets, rights or revenues which, if adversely determined, might have a Material
Adverse Effect.
20.17
Material Adverse Effect

Any Environmental Incident or other similar event or circumstance or series of
events (including any change of law) occurs or, if appropriate, fails to occur,
which the Owner reasonably believes has, or is reasonably likely to have, a
Material Adverse Effect.
20.18
Security enforceable

Any Security Interest (other than a Permitted Maritime Lien) in respect of any
Charterer Security Asset becomes enforceable.
20.19
Change of Ownership

If, without the Owner's and Lender’s written consent, (a) Pangaea ceases to be
the sole legal and beneficial shareholder of BFB, directly or indirectly; or (b)
Pangaea ceases to be the legal and beneficial owner of at least fifty percent
(50%) of the shares in the Parent, directly or indirectly; or (c) STST transfers
any proportion of its fifty percent (50%) shareholding in the Parent to a
company that is not wholly owned directly or indirectly by Pangaea; or (d) the
Parent ceases to be the sole legal and beneficial shareholder of the Charterer,
directly, except where Pangaea is the sole legal and beneficial shareholder of
the Charterer (directly or indirectly).
20.20
Vessel registration

Except with approval of the Owner, the registration of the Vessel under the laws
and flag of the State of Registration is cancelled or terminated or, where
applicable, not renewed or, if the Vessel is only provisionally registered on
the Delivery Date, the Vessel is not permanently registered under such laws
within ninety (90) days of such date.
20.21
Political Risk

The State of Registration or any Relevant Jurisdiction of an Obligor becomes
involved in hostilities or civil war or there is a seizure of power in the State
of Registration or any such Relevant Jurisdiction by unconstitutional means if,
in any such case, such event or circumstances, in the reasonable opinion of the
Owner, has or is reasonably likely to have, a Material Adverse Effect and,
within fourteen (14) days of notice from the Owner to do so, such action as the
Owner may require to ensure that such event or circumstance will not have such
an effect has not been taken by the Charterer.
20.22
Termination or Amendment of Transaction Documents:

Any Transaction Document is terminated, rescinded, frustrated or cancelled by
any party thereto or is amended or varied without the prior consent of the Owner
or any moneys assigned pursuant to any of the Security Documents are paid other
than as provided therein.
20.23
Charterer's Obligation upon a Termination Event

Upon the occurrence of a Termination Event which is continuing, the Charterer
shall provide the Owner with all assistance, co-operation and information
necessary in the opinion of the Owner or any relevant Interested Party to
ascertain the condition and determine the location of the Vessel and to recover
possession of the Vessel.
20.24
Acceleration, Termination and Repossession

Upon the occurrence of a Termination Event and at any time thereafter so long as
the same is continuing, the Owner may at its option (and without prejudice to
any of its other rights under this Charter or at law) by notice to the Charterer
forthwith or on such date as the Owner shall specify, declare this Charter to be
in default and/or exercise any one or more of the following remedies:
(a)
without being in any way obliged or responsible for doing so and without
prejudice to the ability of the Owner to treat that non-compliance as a
Termination Event, effect compliance on the Charterer’s behalf, and if the Owner
incurs any expenditure in effecting such compliance the Owner will be entitled
to recover such expenditure from the Charterer together with interest thereon at
the Default Interest Rate from the date on which such expenditure is incurred by
the Owner until the date of reimbursement thereof by the Charterer (both before
and after judgement);

(b)
the Owner may terminate or cancel this Charter and/or require that the Charterer
return the Vessel immediately to the Owner and the parties hereby agree that a
notice under the hand of the Owner addressed to the master of the Vessel
advising him that the Charterer's possession of the Vessel pursuant to this
Charter has been so terminated shall be sufficient authority to that master to
take orders from the Owner and disregard any orders of the Charterer;

(c)
the Owner may declare that the Accelerated Charterhire Amount shall immediately
become due and payable, whereupon such amounts shall immediately become due and
payable by the Charterer to the Owner;

(d)
the Owner may (a) sell the Vessel at public or private sale, with or without
notice to the Charterer, free of any lease, charter or other engagement
concerning her for such price and on such terms and conditions as it may in its
absolute discretion think fit or (b) hold, use, operate, charter to others or
keep idle the Vessel, as the Owner in its sole discretion may determine, all
free and clear of any rights of the Charterer and without any duty to account to
the Charterer with respect to such action or inaction or for any proceeds with
respect thereto except to the extent that the law otherwise compulsorily
requires;

(e)
the Owner may collect and receive all earnings and the Owner may give a good
receipt therefore on behalf of the Charterer and may (but without any obligation
to do so) apply such earnings as actually received by it after deducting
therefrom all costs and expenses incurred therefor to any debts of the Charterer
hereunder or, without any such application, retain the same for its own account
(provided that any such earnings arising during the period that the Charterer
operates the Vessel shall be, upon the Owner 's receipt thereof, applied to
amounts owing by the Charterer to the Owner hereunder);

(f)
in the event the Owner, pursuant to sub-paragraph (d) above, shall have sold or
otherwise disposed of the Vessel, the Charterer shall pay to the Owner on the
date of such sale, as liquidated damages, the Accelerated Charterhire Amount
(including but not limited to unpaid Charterhire Principal due on or prior to
the date of such sale) plus an amount equal to any moneys due and payable under
the Transaction Documents (including any brokerage, address commissions and all
other expenses incurred by the Owner for the sale of the Vessel and all moneys
paid by the Owner for discharging any claims in respect of the Vessel) less the
proceeds of such sale, together with overdue interest thereon at the Default
Interest Rate from the date of such sale until the date of payment in full;

(g)
the Owner may, instead of selling the Vessel and claiming the amount pursuant to
the foregoing paragraph (f), determine the Fair Market Value of the Vessel in an
"as is" condition and retain the Vessel, in which event the Charterer shall pay
to the Owner on the date of such estimation the Accelerated Charterhire Amount
(including but not limited to unpaid Charterhire Principal due on or prior to
the date of such estimation) and all moneys paid by the Owner for discharging
any claims in respect of the Vessel less such Fair Market Value, together with
overdue interest thereon at the Default Interest Rate from the date of such
estimation until the date of payment in full

(h)
the Owner may exercise any other right or remedy which may be available to it
under the other Transaction Documents, and under applicable law, or proceed by
appropriate judicial or administrative action to enforce the terms hereof or to
recover damages for the breach hereof or to rescind this Charter; and/or

(i)
in addition to the above remedies, the Charterer shall be liable for any and all
unpaid Charterhire due hereunder before and during the exercise of any of the
foregoing remedies and for all legal fees and other costs and expenses incurred
by reason of the occurrence of any Termination Event which is continuing or the
exercise of Owner's remedies with respect thereto.

(j)
Notwithstanding the provisions of this clause 20.24, upon receipt by the Owner
of the Accelerated Charterhire Amount, the Owner shall transfer title to the
Vessel to the Charterer or its nominee unless (i) the Owner has sold the Vessel
pursuant to clause 20.24(d), or (ii) the Owner has exercised its rights pursuant
to clause 20.24(g).

20.25
Waterfall

Following a declaration by the Owner under clause 20.24 (Acceleration,
Termination and Repossession) all moneys received by the Owner under this
Charter and any other Transaction Documents shall, after payment to the Owner of
all costs, charges or expenses incurred by the Owner in enforcing its rights
hereunder or under such Transaction Documents, be applied by the Owner in the
following manner:
First if applicable, in payment of any documented costs incurred by or on behalf
of the Owner in connection with re-possessing, auctioning and/or maintaining the
Vessel and exercising, enforcing and preserving the Owner's rights in respect of
the Vessel and under the Transaction Documents;
Second in or towards payment to the Owner of all amounts due to it but unpaid
under the Transaction Documents, such payments to be made in the order set
forth, and otherwise in accordance with, clause 10.4 (Partial Payments); and
Third in payment of the balance remaining to the Charterer or to whomsoever else
(including Pangaea) may be entitled thereto.
20.26
Remedies Cumulative

(a)
The remedies in this clause 20 (Termination Events) provided in favour of the
Owner upon the occurrence of a Termination Event are cumulative and are in
addition to (and not exclusive of) all other remedies in its favour existing at
law, in equity or in bankruptcy.

(b)
The election by the Owner at any time to enforce any of their remedies in no way
bars the later enforcement from time to time of any other of its remedies.

21
Assignment

(a)
Save for any Security Interest created by the Security Documents, the Charterer
shall not be entitled to assign or transfer all or any of its rights, benefits
and obligations under this Charter without the Owner's consent.

(b)
Unless a Termination Event has occurred and is continuing or pursuant to a
Permitted Security Interest, the Owner shall not mortgage, charge or assign,
without the Charterer's prior consent, the Owner's rights, title, interests and
benefits in and to this Charter, all Charterhire and other sums receivable by it
hereunder or pursuant to a breach hereof by the Charterer, the Compulsory
Insurances, any Requisition Compensation and/or the Vessel at any time to the
Finance Parties or any of them or to any other person.

22
Confidentiality

(a)
Each Party hereto undertakes that it shall not at any time during the Charter
Period and for a period of two (2) years after termination of the Charter Period
disclose to any person any confidential information concerning the business,
affairs, customers, clients or suppliers of the other Party or of any of that
Party's Affiliates (the Confidential Information), except as permitted by clause
22(b) below.

(b)
Each Party may disclose the Confidential Information:

(i)
to its employees, officers, directors, representatives, auditors or advisers who
need to know such information for the purposes of exercising that Party's rights
or carrying out its obligations under or in connection with this Charter and the
other Transaction Documents. Each Party shall ensure that the persons
aforementioned to whom it discloses the Confidential Information comply with
this paragraph (b); except that there shall be no such requirement if the
recipient is subject to professional obligations to maintain the confidentiality
of the information;

(ii)
as may be required by law, a court of competent jurisdiction, the relevant stock
exchange or any governmental or regulatory authority or similar body;

(iii)
with the consent of the other Party; and

(iv)
(in respect of the Owner) to the Lender in order to pursuant to articles
7A.01(3) (Information) and 10.05 (Freedom to Disclose Information) of the Loan
Agreement.

(c)
The Charterer shall not use the Confidential Information for any purpose other
than to exercise its rights and perform its obligations under or in connection
with this Charter and the other Transaction Documents.

23
Calculations and Certificates

23.1
Accounts

In any litigation or arbitration proceedings arising out of or in connection
with a Transaction Document, the entries made in the accounts maintained by the
Owner or a Finance Party are, in the absence of manifest error, conclusive
evidence of the matters to which they relate.
23.2
Certificates and Determinations

Any certification or determination by the Owner of a rate or amount under any
Transaction Document is, in the absence of manifest error, conclusive evidence
of the matters to which it relates.
23.3
Day Count Convention

Any interest, commission or fee accruing under a Transaction Document will
accrue from day to day and is calculated on the basis of the actual number of
days elapsed and a year of three hundred sixty (360) days.
23.4
Rounding

If, after calculation of any amount under this clause, there is any fraction of
less than One Cent (US$0.01), such fraction shall be discarded.

24
Partial Invalidity

If, at any time, any provision of a Transaction Document is or becomes illegal,
invalid or unenforceable in any respect under the law of any jurisdiction,
neither the legality, validity or enforceability of the remaining provisions
hereof nor the legality, validity or enforceability of such provision under the
law of any other jurisdiction will in any way be affected or impaired.

25
Remedies and Waivers

No failure to exercise, nor any delay in exercising, on the part of the Owner
any right or remedy under any Transaction Document will operate as a waiver
thereof, nor will any single or partial exercise of any right or remedy prevent
any further or other exercise thereof or the exercise of any other right or
remedy. The rights and remedies provided in this Charter are cumulative and not
exclusive of any rights or remedies provided by law.

26

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26
Notices

26.1
Communications in Writing

Any communication to be made under or in connection with the Transaction
Documents will be made in writing and, unless otherwise stated, may be made by
email, fax or letter.
26.2
Addressee

All notices and other communications required or permitted to be made or
delivered under or in connection with the Transaction Documents shall be in
writing and shall be (a) personally delivered, (b) transmitted by postage
prepaid registered mail, (c) transmitted by telefax or (d) by email if the
Parties agree to communicate by email:
To the Owner:
Nicole Navigation S.A.
c/o Sumitomo Mitsui Finance and Leasing Co., Ltd.
Fax Number: +81-3-5219-6574 / +1-212-224-4865
Attention: Mr.Tomoyuki Tsuji / Mr. Mitsunori Owada
Email: tsuji-t@smfl.co.jp / mitsunori_owada@smflus.com
To the Charterer:
Bulk Nordic Five Ltd.

c/o Phoenix Bulk Carriers (US) LLC
Long Wharf, Newport
Rhode Island
United States of America
Fax Number: +1.401.846.1520
Attention: Mr. Neil McLaughlin
Email: nmclaughlin@phoenixbulkus.com
To Pangaea:
Pangaea Logistics Solutions Ltd.

c/o Phoenix Bulk Carriers (US) LLC
Long Wharf, Newport
Rhode Island
United States of America
Fax Number: +1.401.846.1520
Attention: Mr. Neil McLaughlin
Email: nmclaughlin@phoenixbulkus.com
or such alternative address as one party shall notify the other of from time to
time.
26.3
Delivery

Except as otherwise specified herein, all notices and other communications under
or in connection with the Transaction Documents shall be deemed to have been
duly given on (a) the date of receipt if delivered personally, (b) the date five
(5) days after posting if sent by registered mail or (c) if by facsimile or
email, the date when such facsimile is received by the recipient in legible
form, as

27

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evidenced by the transmission receipt, whichever shall first occur. Either party
may change its address for purposes hereof by notice in writing to the other
party.
26.4
English Language

(a)
Unless otherwise agreed by the Owner, any notice given under or in connection
with each Transaction Document must be in English.

(b)
Unless otherwise agreed by the Owner, all other documents provided under or in
connection with each Transaction Document must be:

(i)
in English; or

(ii)
if not in English accompanied by a certified English translation.

27
Counterparts

Each Transaction Document may be executed in any number of counterparts, and
this has the same effect as if the signatures on the counterparts were on a
single copy of the relevant Transaction Document.

28
Time of the Essence

Without prejudice to any grace periods contained herein, the time stipulated in
this Charter for all payments payable by any party hereto and for the
performance of any party's obligations under this Charter will be of the essence
of this Charter.

29
Governing Law and Jurisdiction

29.1
Governing Law

This Charter and any non-contractual obligations connected with it shall be
governed by, and shall be construed in accordance with, English law.
29.2
Jurisdiction

(a)
The courts of England have exclusive jurisdiction to settle any dispute arising
out of or in connection with this Charter (including any dispute relating to any
non-contractual obligation arising from or in connection with this Charter and
any dispute regarding the existence, validity or termination of this Charter (a
Dispute)).

(b)
The Parties agree that the courts of England are the most appropriate and
convenient courts to settle Disputes and accordingly no Party will argue to the
contrary.

(c)
This clause 29.2 is for the benefit of the Owner only. As a result, the Owner
shall not be prevented from taking proceedings relating to a Dispute in any
other courts with jurisdiction. To the extent allowed by law, the Owner may take
concurrent proceedings in any number of jurisdictions.

(d)
Without prejudice to any other mode of service, the Charterer and Owner:

(i)
irrevocably appoint the respective Process Agent as its agent under the
Transaction Documents for service of process in relation to any proceedings
before any courts located in England;

(ii)
agrees to maintain an agent for service of process in England during the Charter
Period;

(iii)
agrees that failure by the Process Agent to notify the Charterer or Owner, as
applicable, of the process will not invalidate the proceedings concerned;

(iv)
consents to the service of process relating to any proceedings by prepaid
posting of a copy of the process to its address for the time being notified to
the other Party; and

(v)
agrees that if the appointment of any person mentioned in paragraphs (i), (ii)
or (iii) above ceases to be effective, the Owner or Charterer as the case may be
may immediately appoint a further person in England to accept service of process
on the other Party’s behalf in England, and, if the Charterer or Owner does not
appoint a process agent within seven (7) days, the other Party is entitled and
authorised to appoint a process agent for the Charterer or Owner, as applicable,
by notice to the Charterer or Owner.

30
Survival

The indemnities set forth in clause 7 (Tax), clause 8 (Increased Costs), clause
9 (Other Indemnities), clause 22 (Confidentiality), clause 29 (Governing Law and
Jurisdiction) and clause 31 (Contracts (Rights of Third Parties Act) 1999) will
survive the termination of this Charter.

31
Contracts (Rights of Third Parties Act) 1999

31.1
Unless expressly provided to the contrary in this Charter or any other
Transaction Document, a person who is not a party to that Transaction Document
may not enforce any of its terms under the Contracts (Rights of Third Parties)
Act 1999.

31.2
Notwithstanding any term of any Transaction Document, the consent of any third
party is not required for any variation (including any release or compromise of
any liability under) or termination of that Transaction Document.

IN WITNESS WHEREOF the Parties have caused this Charter to be duly executed on
the day and year first before written.

Schedule 1
Condition Precedent Documents
1
The Charterer and Pangaea

(a)
Documentary evidence of the authority of each person who:

(i)
has signed or will sign any Transaction Document on behalf of the Charterer and
Pangaea (a Relevant Party); and

(ii)
will sign the statements, reports, certificates, notices and other documents
required under any Transaction Document or will otherwise act as a
representative of that Relevant Party in relation to the implementation,
administration or performance of any Transaction Document to which it is
respectively party (such documentary evidence to include certified copies of all
governmental and corporate consents obtained in order to authorise the
execution, delivery and performance by such Relevant Party of any Transaction
Document and the transactions contemplated thereby);

(b)
the authenticated specimen signatures of and certificates of incumbency in
respect of each person described in paragraph (a) above;

(c)
certified copies of the memorandum of association and bye-laws (including all
amendments) and certificates of incorporation (and certificates of incorporation
of change of name, if applicable) (or equivalent) or other constitutional
documents of each Relevant Party;

(d)
certified copies (certified by an officer or authorised signatory of the
Charterer) of board resolutions or other equivalent corporate authorisation
documentation reasonably acceptable to the Owner and all relevant authorisations
(including English translations where applicable) relating to the power and
authority of each Relevant Party (in their relevant respective capacities) and
the performance of their respective obligations under the Transaction Documents;

(e)
in respect of each Relevant Party the agreement of its process agent for service
of process in London to act in such capacity (in form and substance satisfactory
to the Owner) and that such appointment shall continue throughout the Charter
Period; and

(f)
certified copies of each Relevant Party’s register of members and register of
directors and officers.

2
Transaction Documents

(a)
The Owner has received an original of each Transaction Document to which a Group
Member or Manager is party, duly executed by each party to that document,
together with all ancillary documents to be delivered pursuant thereto.

(b)
The Owner having received or being satisfied it will receive the documents or
instruments set out in clause 3 of the Purchase Agreement duly executed by the
parties to them.

(c)
The Owner having received evidence that each Security Document (other than the
Vessel Mortgage) has been duly registered, filed or stamped as advised as
necessary by the Owner's legal counsel.

3
Insurances

(a)
a copy of all cover notes and certificates of entry evidencing the Compulsory
Insurances which have been placed and will be in effect from the delivery of the
Vessel under the Purchase Agreement;

(b)
a fax or email confirmation from each broker, insurer (if any insurances are
placed direct and not through a broker) and the manager of any club or
association concerned with the Compulsory Insurances of the Vessel that pursuant
to the insurance covenants set out in clause 17.1(d) (Insurances) of the
Charter:

(i)
the relevant cover is in effect or will be as of the Delivery Date in effect
(including by the issue of the cover note);

(ii)
they will accept notice of assignment of the Compulsory Insurances in favour of,
inter alios, the Owner;

(iii)
if and to the extent that the Vessel is insured under any fleet policy they will
restrict their lien for unpaid premiums under any fleet policy to unpaid
premiums in respect of the Vessel only;

(iv)
they will issue a letter of undertaking substantially in the form provided for
in the Security Assignment (or in such other form as may be reasonably
acceptable to the Owner) or, in the case of the Protection and Indemnity
Insurance, in the standard form of the protection and indemnity club or
association (provided it is acceptable to the Owner, acting reasonably) within
five (5) Business Days following the Delivery Date or such other longer period
as the Owner may agree in writing;

(v)
they will accept an endorsement of a loss payable clause on the policies
substantially in the form provided for in the Security Assignment (in the case
of brokers and insurers other than clubs) or will note the interest of the Owner
in the entry for the Vessel by way of a loss payable clause in their current
standard form (in the case of clubs); and

(vi)
they are not aware of any mortgage, charge, assignment or other encumbrance
affecting the Insurances with which they are concerned.

4
Vessel Related Documents

(a)
An Acceptance Certificate executed by the Charterer.

(b)
Evidence that the Vessel is operationally seaworthy and in every way fit for
service.

(c)
Evidence that the Vessel is subject to a ship security plan which the Charterer
confirms complies with the ISPS Code.

(d)
A certified copy (certified by an officer or authorised signatory of the
Charterer) of:

(i)
a classification certificate in respect of the Vessel showing the Vessel to be
in class without any overdue recommendation, condition or qualification;

(ii)
a valid Safety Management Certificate for the Vessel as required under the ISM
Code;

(iii)
a valid DOC as required under the ISM Code in respect of the Charterer or the
Manager (as relevant);

(iv)
a valid International Ship Security Certificate for the Vessel (if and to the
extent required under the terms of the ISPS Code in respect of the Vessel as at
the Delivery Date);

(v)
a certificate of financial responsibility (COFR) and other necessary documents
(if the Vessel is to trade in the United States of America).

(e)
Evidence that each party to the Contract of Construction and Sale has fulfilled
its obligations thereunder.

5
Licenses and Consents for operation of the Vessel

(a)
A certificate from the Charterer dated as of the Delivery Date that:

(i)
it has obtained any necessary consents, authorisations, licences, approvals
(including, for the avoidance of doubt, all requisite Environmental Approvals in
relation to the Vessel) in the State of Registration of the Vessel and its state
of incorporation and it has complied with all requirements for the delivery,
use, possession, management, chartering and operation applicable to the Vessel
in its State of Registration of the Vessel and the Charterer's state of
incorporation as from the Delivery Date;

(ii)
such consents, authorisations, licences and approvals and documents as are
mentioned in paragraph (i) above which have been obtained remain in full force
and effect; and

(iii)
it has received no notice of any Environmental Claim in relation to the Vessel
which alleges non-compliance with applicable Environmental Laws.

6
Taxes and Fees

(a)
Evidence that all registration and all annual and other Taxes, fees, duties and
charges payable to Panamanian government agencies, authorities and departments
with respect to the Vessel have been fully paid or will be fully paid.

(b)
Evidence that all service or consultancy fees, any other fees, costs and
expenses then due from the Charterer and the other Obligors pursuant to this
Charter or any other Transaction Document have been paid or will be paid.

(c)
The Original Financial Statements.

(d)
Confirmation from the Owner that the Upfront Fee and Administration Fee has been
paid.

7
Legal Opinions

The Owner having received from:
(a)
Norton Rose Fulbright Gaikokuho Jimu Bengoshi Jimusho, legal advisers as to
English law to the Owner, in form and substance satisfactory to the Owner a
legal opinion, in regard to the enforceability of (amongst others) this Charter
and the Purchase Agreement;

(b)
Taylors in association with Walkers LLP, legal advisers as to Bermudan law to
the Owner, in form and substance satisfactory to the Owner a legal opinion with
respect to (amongst others) the due incorporation and due execution by the
Charterer and Pangaea of the Transaction Documents to which it is a party; and

(c)
Morgan & Morgan, legal advisers as to Panamanian law to the Owner, in a form and
substance satisfactory to the Owner a legal opinion in respect of the
enforceability of the Vessel Mortgage.

8
Ownership

Evidence satisfactory to the Owner of the ownership structure of the Charterer
and Pangaea including evidence that:
(a)
a Group Member (or other Affiliate of Pangaea acceptable to the Owner) has
acquired or will acquire by the Delivery Date STST’s entire shareholding in the
Parent; or

(b)
Pangaea has acquired or will acquire by the Delivery Date, either directly or
indirectly, the entire shareholding of the Charterer.

Provided however, where the conditions in paragraphs (a) or (b) above is not
satisfied on or before the Delivery Date, the Charterer shall have 30 days to
give effect to either paragraph (a) or (b), the failure of which shall
constitute a Termination Event.
9
Authorisations

Evidence satisfactory to the Owner that all authorisations, acts, government or
regulatory approvals or other third-party consents which are required in
connection with the entry into, performance, legality, validity and
enforceability of, and the transactions contemplated by, the Charterer Documents
have been, or will be obtained or performed (as appropriate) and are, or will be
in full force and effect in the reasonable opinion of the Owner.
10
Know your customer

Completion by each Finance Party of its know your customer requirements.
11
Collateral Maintenance Ratio

Any prepayment required under clause 13.18 (Collateral Maintenance Ratio) has
been made.
12
Charter confirmation

A written confirmation from the Charterer that the Owner’s documents provided in
accordance with Clause 3.4 are satisfactory to it.
13
Other conditions precedent

Such other documents and evidence as the Owner may reasonably require.

Schedule 2    
Form of Acceptance Certificate
We, Bulk Nordic Five Ltd., hereby accept delivery of m.v. Bulk Destiny
registered or to be registered under the laws and flag of Panama with hull
number 10762 from Nicole Navigation S.A. (the Owner) at          hours
(              time) on       day of                       pursuant to a
bareboat charter party dated                        2016 made between us and the
Owner and that the Charter Period as defined under the said charter party shall
be deemed to have commenced at the relevant time of this date.

For and on behalf of
Bulk Nordic Five Ltd.

___________________________
Name:
Title:

Acknowledged and Agreed

For and on behalf of
Nicole Navigation S.A.

___________________________
Name:
Title:

28

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Schedule 3    
Fixed Charterhire Payment Table

 
A
B

Instalment
Fixed Charterhire
(USD)
Charterhire Principal (excluding prepayments) (USD)
Delivery Date
0.00
21,000,000.00
1
307,698.70
20,692,301.30
2
310,583.38
20,381,717.92
3
313,495.10
20,068,222.82
4
316,434.12
19,751,788.70
5
319,400.69
19,432,388.01
6
322,395.07
19,109,992.94
7
325,417.52
18,784,575.42
8
328,468.31
18,456,107.11
9
331,547.70
18,124,559.41
10
334,655.96
17,789,903.45
11
337,793.36
17,452,110.09
12
340,960.17
17,111,149.92
13
344,156.67
16,766,993.25
14
347,383.14
16,419,610.11
15
350,639.86
16,068,970.25
16
353,927.11
15,715,043.14
17
357,245.18
15,357,797.96
18
360,594.35
14,997,203.61
19
363,974.92
14,633,228.69
20
367,387.19
14,265,841.50
21
370,831.44
13,895,010.06
22
374,307.99
13,520,702.07
23
377,817.12
13,142,884.95
24
381,359.16
12,761,525.79
25
384,934.40
12,376,591.39
26
388,543.16
11,988,048.23
27
392,185.75
11,595,862.48
28
395,862.48
11,200,000.00

Schedule 4    
Compulsory Insurances

1
Hull and Machinery (including freight interest) /Increased Value

Risks:
Not less wide than Institute Time Clauses – Hulls 1.10.83 or equivalent, and
extended to cover Institute Additional Perils Clause – Hulls and including
Excess Risks and all other risks deemed appropriate for the trading pattern of
the Vessel.
 
For the purposes of the above, Excess Risks means:
 
(a)    the proportion of claims for general average, salvage and salvage charges
which are not recoverable as a result of the value at which the Vessel is
assessed for the purpose of such claims exceeding her hull and machinery insured
value;
 
(b)    collision liabilities not recoverable in full under the hull and
machinery insurance by reason of those liabilities exceeding such proportion of
the insured value of the Vessel as is covered under those liabilities; and
Value:
An amount, on an agreed value basis, in US$ which is not less than the Required
Insurance Amount or the Fair Market Value of Vessel, whichever is the greater.
Deductibles:
Not exceeding two hundred and fifty thousand U.S. Dollars (US$250,000).
Insured:
The Owner, the Charterer and the Manager(s) as their interests may appear.
Loss Payees:
The Charterer and the Owner, subject to a loss payable clause approved by the
Owner.

2
War and Strikes

Risks:
Not less wide than Institute War and Strikes Clauses Hulls – Time 1.10.83 or
equivalent, (including London Blocking and Trapping Addendum or similar
arrangements).
Value:
As H&M/IV. War P&I subject to separate and additional limit as H&M/IV value.
Insured:
As H&M/IV.
Loss Payees:
As H&M/IV.

3
Protection and Indemnity

Cover:
Shipowners Third Party Liability cover as per a Member of the International
Group of P&I Clubs on a ‘Full Terms’ basis.
Amount:
As per a Member of the International Group of P&I Clubs (currently in an amount
equal to the maximum limit of cover generally available from protection and
indemnity associations, but in the case of oil pollution risks, for a minimum
amount of one billion U.S. Dollars (US$1,000,000,000) or such other amount as is
normally covered by such protection and indemnity association in respect of
which cover is available in accordance with customary insurance market
practice).
Deductible:
As per a Member of the International Group of P&I Clubs.
Insured:
The Owner, the Charterer and the Manager(s) each as an additional entered
member.
Loss Payee:
The Charterer and the Owner, subject to a loss payable clause approved by the
Owner.

EXECUTION PAGE
BAREBOAT CHARTER PARTY

OWNER

SIGNED by Tetsutaro Hiraoka    )
Name: Tetsutaro Hiraoka    )
as authorised signatory for and on behalf of    )
NICOLE NAVIGATION S.A.    )    Signed: /s/ Tetsutaro Hiraoka

EXECUTION PAGE
BAREBOAT CHARTER PARTY

CHARTERER

SIGNED by         )
Name: Arthur E.M. Jones Don P. Dunstan
Director Director        )
as authorised signatory for and on behalf of        )
BULK NORDIC FIVE LTD.        )    Signed: /s/ Arthur E.M. Jones
/s/ Don P. Dunstan

29