*  Application to be filed with the Securities and Exchange
     Commission, pursuant to Exchange Act Rule 24b-2, for confidential
     treatment of certain portions of this exhibit.
                                                            
                                              EXECUTION COPY



___________________________________________________________________


                 SECOND AMENDED AND RESTATED
                              
                        AGREEMENT TO
                              
                     ACQUIRE AND CHARTER
                              
                        By and Among
                              
               AMERICAN PRESIDENT LINES, LTD.,
                                           Transferor,
                              
                M.V. PRESIDENT KENNEDY, LTD.,
                 M.V. PRESIDENT ADAMS, LTD.,
                M.V. PRESIDENT JACKSON, LTD.,
                 M.V. PRESIDENT POLK, LTD.,
                M.V. PRESIDENT TRUMAN, LTD.,
                   APL SHIPHOLDINGS, LTD.,
                                           Transferees,
                              
               KREDITANSTALT FUR WIEDERAUFBAU
                   (as Agent and Lender),
                              
                   COMMERZBANK AG, HAMBURG
                    (as Syndicate Agent),
                              
                COMMERZBANK AG (KIEL BRANCH),
                 DRESDNER BANK AG (HAMBURG),
                  VEREINS-und WEST BANK AG,
                   DEUTSCHE SCHIFFSBANK AG
          NORDDEUTSCHE LANDESBANK-GIROZENTRALE and
         DEUTSCHE VERKEHRS-BANK AG (HAMBURG BRANCH)
           BANQUE INTERNATIONALE A LUXEMBOURG S.A.
                     (as the Syndicate)
                              
                              
                              
                              
                   Dated September 1, 1995
________________________________________________________________
<PAGE>
                      TABLE OF CONTENTS

                                                        Page

RECITALS                                                       1

SECTION 1.      DEFINITIONS                                    4

SECTION 2.      TRANSFER AND CHARTER OF THE VESSELS            6

SECTION 3.      CONDITIONS PRECEDENT TO A TRANSFEREE'S
                OBLIGATIONS ON A DELIVERY DATE                 7

SECTION 4.      REPRESENTATIONS AND WARRANTIES OF TRANSFEREES 10

SECTION 5.      COVENANTS                                     14

SECTION 6.      RELEASE OF A TRANSFEREE                       18

SECTION 7.      THIRD PARTY VESSEL EXCHANGE                   18

SECTION 8.      NOTICES                                       19

SECTION 9.      COUNTERPARTS                                  19

SECTION 10.     MODIFICATION                                  19

SECTION 11.     SUCCESSORS AND ASSIGNS                        19

SECTION 12.     GOVERNING LAW                                 19

SECTION 13.     ASSIGNMENT                                    20

SECTION 14.     SEVERABILITY                                  20

SECTION 15.     TABLE OF CONTENTS; HEADINGS                   20

SCHEDULE 1      List of Transferees
SCHEDULE 2      List of Syndicate Banks

EXHIBIT   A     Form  of  Charter  (Vessel  transferred   to Transferee
                by Original Owner)
EXHIBIT   A-1   Form  of  Charter  (Vessel  transferred   to Transferee
                by Transferor)
EXHIBIT  B-l    Form  of  HDW  Certificate  of  Delivery   and Acceptance
EXHIBIT  B-2    Form  of Daewoo Certificate  of  Delivery  and Acceptance
EXHIBIT   C     Form  of  Charter  Assignment/Second  Charter Assignment
                and Consent
EXHIBIT D       Form of Charter Guarantee
<PAGE>
                 SECOND AMENDED AND RESTATED
              AGREEMENT TO ACQUIRE AND CHARTER


      THIS  SECOND AMENDED AND RESTATED AGREEMENT TO ACQUIRE
AND  CHARTER  (this  "Acquisition Agreement")  is  made  and
entered  into as of this 1st day of September, 1995  by  and
among   (i)  AMERICAN  PRESIDENT  LINES,  LTD.,  a  Delaware
corporation  (the  "Transferor"); (ii) the six  corporations
listed  on  Schedule  1 attached hereto  (collectively,  the
"Transferees" and each, individually, a "Transferee"); (iii)
KREDITANSTALT  FUR  WIEDERAUFBAU  ("KfW"),  a   public   law
corporation incorporated in the Federal Republic of Germany;
(iv)   COMMERZBANK   AG,  HAMBURG,  a  banking   corporation
incorporated  in  the  Federal  Republic  of  Germany   (the
"Syndicate  Agent)"; and (v) the banks listed in Schedule  2
attached   hereto   (each   a   "Syndicate   Member"    and,
collectively, the "Syndicate").

       This  Acquisition  Agreement  amends,  restates   and
supersedes in its entirety that certain Agreement to Acquire
and  Charter dated March 14, 1994 among the parties  hereto,
which  Agreement was previously amended and restated in  its
entirety  pursuant  to  that certain  Amended  and  Restated
Agreement  to Acquire and Charter dated May 19,  1995  among
the  parties  hereto and acknowledged by  APL  Newbuildings,
Ltd., a Nevada corporation (collectively, the "Old AAC").

RECITALS:

      A. The Transferor has contracted to purchase three (3)
container  vessels  (the "HDW Vessels") from  Howaldeswerke-
Deutsche Werft AG ("HDW'') as is more specifically set forth
in  a certain Shipbuilding Agreement dated May 10, 1993,  as
amended  (the  OHDWO Shipbuildinq Agreement"),  between  the
Transferor and HDW.

     B. The three (3) HDW Vessels have been or will be named
as follows: (i) APL CHINA (Builder's Hull No. 297), (ii) APL
JAPAN  (Builder's  Hull  No. 298)  and  (iii)  APL  THAILAND
(Builder's Hull No. 299).

     C. The Transferor has also contracted to purchase three
(3)  container  vessels (the "Daewoo Vessels")  from  Daewoo
Shipbuilding & Heavy Machinery Ltd. ("Daewoo")  as  is  more
specifically  set forth in a certain Shipbuilding  Agreement
dated  May  10,  1993, as amended (the "Daewoo  Shipbuilding
Agreement"),  between the Transferor  and  Daewoo  (the  HDW
Vessels  and the Daewoo Vessels being individually  referred
to as a Vessel and, collectively, as the OVesselsO).

      D.  The three (3) Daewoo Vessels have been or will  be
named as  follows:  (i) APL KOREA (Builder's Hull No. 4028),
(ii) APL  SINGAPORE  (Builder's Hull  No.  4029)  and  (iii)
APL PHILIPPINES (Builder's Hull No. 4033).

      E.  The  Transferor, KfW, the Syndicate Agent and  the
Syndicate  entered  into a Loan Agreement  dated  March  14,
1994,  providing  a  loan facility in  respect  of  the  HDW
Vessels  and  the Daewoo Vessels under which the  Transferor
may  borrow  from  KfW up to * (the "HDW Tranche")  for  the
purchase  of  the  HDW  Vessels; and  may  borrow  from  the
Syndicate up to * (the "Daewoo Tranche") for the purchase of
<PAGE>
the  Daewoo  Vessels  (said Loan Agreement,  as  amended  by
Amendment  No.  1  thereto dated as  of  May  19,  1995  and
Amendment  No. 2 thereto of even date herewith, and  as  the
same  may be further amended and supplemented from  time  to
time   in  accordance  with  its  terms,  being  hereinafter
referred to as the "Loan Agreement").

      F. The parties hereto wish to allow the Transferor  to
make  partial assignments of the HDW Shipbuilding  Agreement
or  the  Daewoo Shipbuilding Agreement to up to six separate
Delaware  corporations, each to be a wholly-owned subsidiary
of   American   President  Companies,   Ltd.,   a   Delaware
corporation  (the  "Charter Guarantor")  (such  subsidiaries
being  referred  to, collectively, as the "Original  Owners"
and,  individually, as an "Original Owner"),  each  Original
Owner   to   be  partially  assigned  the  HDW  Shipbuilding
Agreement or the Daewoo Shipbuilding Agreement, as the  case
may  be, only insofar as such Agreement relates to a  single
Vessel;  provided, however, that, as provided  in  the  Loan
Agreement, the Transferor reserves the right not  to  assign
any  Shipbuilding Agreement, but to take title  directly  to
the  relevant Vessel and either to draw down the  applicable
Subportion  under  the Loan Agreement  or  to  transfer  the
Vessel   to   a   Transferee  following   the   Transferor's
acquisition of a Vessel pursuant to an Exchange Agreement.

      G.  The  Original Owners, each of which  is  to  be  a
Delaware  corporation, will acquire  the  Vessels  from  the
respective Builders as follows (if at all):

           (1)   APL   Newbuildings,   Ltd.,   a   Delaware
     corporation, to acquire APL CHINA;
     
           (2) APL M.V. Korea, Ltd., a Delaware corporation,
     to acquire APL KOREA;
     
           (3) APL M.V. Japan, Ltd., a Delaware corporation,
     to acquire APL JAPAN;
     
           (4) APL M.V. Singapore, Ltd., a Delaware
     corporation, to acquire APL SINGAPORE;
     
           (5)   APL   M.V.  Thailand,  Ltd.,  a   Delaware
     corporation,
     to acquire APL Thailand; and
     
           (6)  APL  M.V.  Philippines,  Ltd.,  a  Delaware
     corporation, to acquire APL PHILIPPINES.
     
      H. On May 19, 1995, pursuant to the Old AAC, APL CHINA
was delivered by the Builder to APL Newbuildings, Ltd., and,
on   the  same  date,  APL  CHINA  was  transferred  by  APL
Newbuildings, Ltd. to one of the Transferees, M.V. President
Kennedy,  Ltd.,  as part of an exchange for a  C-10  conbulk
vessel  owned by such Transferee, prior to the draw down  of
the Subportion relating to such Vessel by such Transferee.

     I. With respect to any of the remaining Vessels, if the
Transferor  so  requests, the parties desire to  permit  the
Vessel  to  be delivered by the applicable Builder  to  such
Original Owner, which Original Owner would remain the  owner
of  the Vessel and would become a "Transferee" authorized to
draw  down  the Subportion relating to that Vessel,  subject
however  to  the  execution of amendments to  the  Operative
<PAGE>
Documents  mutually  acceptable  to  the  Transferor,   such
Original  Owner and the Lenders as provided in Section  7(k)
of the Loan Agreement.

      J.  The parties also desire to permit, upon the  terms
and  conditions  set  forth herein, title  to  each  of  the
Vessels  (other  than APL CHINA) to be  transferred  by  the
Original  Owner  thereof to the Transferor  as  part  of  an
exchange  for a C-10 conbulk vessel owned by the Transferor,
whereupon  the  Transferor  would  transfer  the  Vessel  in
question  to the appropriate Transferee, in connection  with
the  draw down of the Subportion relating to such Vessel  by
such  Transferee, and such Transferee shall be permitted  to
draw  down the Subportion applicable to its Vessel upon such
transfer of the Vessel by the Transferor.

      K. Concurrently with any transfer of each Vessel to  a
Transferee   in  accordance  with  the  terms  hereof,   the
Transferor shall enter into a Charter for such Vessel to  be
so  transferred,  as evidenced by the execution  of  an  HDW
Charter,  if the Vessel is one of the Vessels being financed
under the HDW Tranche, or a Daewoo Charter, if the Vessel is
one  of the Vessels being financed under the Daewoo Tranche,
each  Charter to be in the form of (i) Exhibit A hereto,  if
Vessel in question is being transferred to the Transferee by
the  Original  Owner, or (ii) Exhibit  A-1  hereto,  if  the
Vessel in question is being transferred to the Transferee by
the Transferor.

      L. Concurrently with the execution of each Charter  in
the  form  of Exhibit A hereto, the Charter Guarantor  shall
execute  and deliver to the relevant Transferee a  guarantee
of  payment obligations of the Transferor as charterer under
such  Charter  (it being understood that no  such  guarantee
shall  be required with respect to Charters in the  form  of
Exhibit A-1 hereto).

     M. Concurrently with the execution and delivery of each
Charter, the Transferee will assign all of its right,  title
and  interest in and to such Charter (and, if there is  one,
the  guarantee  by  the  Charter Guarantor  of  the  charter
payment  obligations of the Transferor) to: (i)  KfW  if  it
relates  to an HDW Vessel, (ii) the Syndicate Agent and  the
Syndicate  if it relates to a Daewoo Vessel, and  (iii)  KfW
(as  a second priority assignment) if it relates to a Daewoo
Vessel,  in  each  case  as security  for  the  Transferee's
obligations under the Loan Documents.

     N.  Pursuant  to  the  Loan  Agreement,  the  Charter
Guarantor  has  executed and delivered  to  the  Lenders  an
Amended  and  Restated Guarantee dated May 19,  1995,  which
guarantees  all  obligations  of  the  Transferor  and  each
Transferee as Borrower under the Loan Agreement and Security
Documents.

      NOW,  THEREFORE, in consideration of mutual agreements
herein contained, the parties hereto agree as follows:

SECTION 1.     Definitions.

          A.   The  terms  "hereof",  "herein",  "hereby",
     "hereto",  "hereunder"  and "herewith"  refer  to  this
     Agreement as the same may be supplemented or amended.
     
          B. Reference to a given agreement or instrument is
     a   reference  to  that  agreement  or  instrument   as
<PAGE>
     originally   executed,   and  as   modified,   amended,
     supplemented and restated through the date as of  which
     reference is made to that agreement or instrument.
     
           C. All capitalized terms used in this Acquisition
     Agreement  including the Whereas clauses  hereof  which
     are not defined herein shall have the meanings ascribed
     to  them in the Loan Agreement and in the Schedules and
     Appendices  to  the Loan Agreement.  In  addition,  the
     following capitalized terms shall have the meanings set
     forth below:
     
      "Certificate of Delivery and Acceptance"  means,  with
respect  to  a given Vessel, a certificate in  the  form  of
Exhibit  B-1  or Exhibit B-2, as the case may  be,  to  this
Acquisition  Agreement dated on the Vessel's Delivery  Date,
evidencing  the  delivery of that Vessel to  the  designated
Transferee and the acceptance by such Transferee.

       "Charter   Assignment"  means  each,   and   "Charter
Assignments" means every, first priority assignment of  each
HDW  Charter  and  each Daewoo Charter  by  the  appropriate
Transferee of the Vessel relating thereto to KfW and to  the
Syndicate Agent and the Syndicate, respectively, as security
for such Transferee's obligations as provided under the Loan
Documents  and in the form of Exhibit C to this  Acquisition
Agreement.

      "Charter  Documents" means this Acquisition Agreement,
the *, the Bills of Sale from the appropriate Original Owner
(if  applicable)  and  the Transferor  (following  a  vessel
exchange  between the Transferor and an Original Owner),  as
the  case  may  be, to the Transferee, the  Certificates  of
Delivery  and  Acceptance, the Charters,  the  Charter  Hire
Guarantees,  the Charter Assignments and the Second  Charter
Assignments;  provided,  however,  that,  if  a  Vessel   is
transferred  by the Transferor (following a vessel  exchange
between  the  Transferor and an Original Owner) directly  to
the  Transferee in accordance with the terms  hereof,  there
shall  be  no  Charter Hire Guarantee  in  respect  of  such
Vessel.

      "Charter  Hire  Guarantee" means  each,  and  "Charter
Guarantees" means every, guarantee by the Charter  Guarantor
of  the  payment  obligations  of  the  Transferor  under  a
Charter,  in  the  form  of Exhibit D  to  this  Acquisition
Agreement;   provided,  however,  that,  if  a   Vessel   is
transferred  by the Transferor (following a vessel  exchange
between  the  Transferor and an Original Owner) directly  to
the  Transferee in accordance with the terms  hereof,  there
shall  be  no  Charter Hire Guarantee  in  respect  of  such
Vessel.

     *

     "Second Charter Assignment and Consent" means each, and
"Second  Charter  Assignments" means every, second  priority
assignment  of  a  Daewoo Charter and,  if  applicable,  the
related  Charter  Hire Guarantee by the  Transferee  of  the
Vessel  relating  thereto  to  KfW  as  security  for   such
Transferee's  obligations  under  the  Loan  Documents  with
respect to the Vessel Indebtedness under the HDW Tranche  in
the form of Exhibit C to this Acquisition Agreement.

      "Solvent" means, with respect to any Transferee  on  a
Delivery  Date, that on such date each of the  following  is
<PAGE>
true  as  determined  under  generally  accepted  accounting
principles: (i) the fair market value of the assets  of  the
Transferee  is greater than the total amount of  liabilities
(including  contingent liabilities) of the Transferee,  (ii)
the  present  fair  salable  value  of  the  assets  of  the
Transferee is greater than the amount that will be  required
to  pay  the probable liabilities of the Transferee for  its
debts  as  they  become  absolute  and  matured,  (iii)  the
Transferee  is able to realize upon its assets and  pay  its
debts   and  any  other  liabilities,  including  contingent
obligations, as they mature and (iv) the Transferee does not
have unreasonably small capital.

SECTION 2.     Transfer and Charter of the Vessels.

      With  respect  to any acquisition of  a  Vessel  by  a
Transferee:

           A. On the Delivery Date for such Vessel, upon the
     satisfaction of all conditions precedent set  forth  in
     Section 7 of the Loan Agreement and Sections 2 and 3 of
     this   Acquisition  Agreement,  the  Transferee   shall
     acquire  such  Vessel from the Original  Owner  or  the
     Transferor  (following a vessel  exchange  between  the
     Transferor  and  an Original Owner),  and  the  Lenders
     shall   make   their   Commitment  available   to   the
     Transferee.
     
           B.  The Vessel will have been registered  in  the
     name  of  the initial owner thereof (i.e., the Original
     Owner  or  the  Transferor following a vessel  exchange
     between  the Transferor and an Original Owner,  as  the
     case  may  be)  under the laws of the Republic  of  The
     Marshall Islands and then reregistered in the  name  of
     the  Transferee under the laws of the Republic  of  The
     Marshall  Islands free and clear of all  liens,  claims
     and  encumbrances;  provided, however,  that,  if  such
     Vessel  is  transferred by the Original  Owner  to  the
     Transferor  (following a vessel  exchange  between  the
     Transferor  and  an Original Owner), then,  immediately
     prior  to  the transfer of the Vessel by the Transferor
     to  the  Transferee, the Vessel shall  also  have  been
     reregistered  in the name of the Transferor  under  the
     laws of the Republic of The Marshall Islands.
     
           C. Upon its acquisition of any Vessel pursuant to
     the  terms hereof (following a vessel exchange  between
     the  Transferor and an Original Owner), the  Transferor
     will  execute,  deliver and record  a  first  preferred
     mortgage,  and  with respect to the  Daewoo  Vessels  a
     second  preferred mortgage, in substantially  the  form
     attached to the Loan Agreement, covering the Vessel  in
     favor of the relevant Lenders.
     
           D. Following the acquisition of any Vessel by the
     relevant  Transferee from the Transferor  (following  a
     vessel  exchange between the Transferor and an Original
     Owner),  and  in  connection with the drawdown  of  the
     relevant  Subportion  under  the  Loan  Agreement,  the
     Transferee   will  execute,  deliver  and   record   an
     assumption of the first preferred mortgage executed  by
     the  Transferor, and with respect to the Daewoo Vessels
     an assumption of the second preferred mortgage executed
     by  the  Transferor, in substantially the form attached
     to the Loan Agreement.
     
           E.  Simultaneously with the actions specified  in
     Section  2.C  and  Section 2.D,  the  Transferor  shall
     charter such Vessel from the Transferee, the Transferee
<PAGE>     
     shall  charter such Vessel to the Transferor,  pursuant
     to  the  relevant Charter (it being understood that  if
     the  Vessel  is  transferred to the Transferee  by  the
     Transferor  (following a vessel  exchange  between  the
     Transferor  and  an Original Owner) in accordance  with
     the  terms hereof, the Charter shall be in the form  of
     Exhibit  A-1 hereto, instead of Exhibit A hereto),  and
     the  Charter  Guarantor shall execute and  deliver  the
     related  Charter  Hire  Guarantee;  provided,  however,
     that,  if  the Vessel is transferred by the  Transferor
     (following a vessel exchange between the Transferor and
     an Original Owner) to the Transferee in accordance with
     the terms hereof, it is understood that no Charter Hire
     Guarantee shall be required.
     
           F.  In  connection with the actions specified  in
     Sections 2.A, 2.B, 2.C and 2.D, the Transferees  shall,
     as  required  in  the Loan Agreement  (i)  execute  and
     deliver one or more HDW Note(s) (in the case of an  HDW
     Vessel) or one or more Daewoo Note(s) (in the case of a
     Daewoo  Vessel),  (ii) undertake all obligations  as  a
     co-borrower with joint and several liability  with  the
     other  Transferees,  with respect to  the  HDW  Tranche
     and/or  the  Daewoo Tranche, as the  case  may  be,  as
     evidenced  by  the  execution  and  delivery  of   Note
     endorsements, and (iii) undertake all other obligations
     the Transferee may have under the Loan Documents.
     
           G. Delivery and presentation of all documents  to
     complete the transactions contemplated herein shall  be
     made  at the Closings to be held on the Delivery  Dates
     convened pursuant to the Loan Agreement.
     
SECTION 3.     Conditions Precedent to a Transferee's
               Obligations on a Delivery Date.

      A  Transferee's right to receive a Loan in respect  of
its  Vessel  is  expressly conditioned  upon  the  following
preconditions being satisfied and upon receipt by the  Agent
or the Syndicate Agent, as the case may be, of the following
documents and evidenced on or before a closing to be held on
the Delivery Date at the offices of Haight, Gardner, Poor  &
Havens,  195 Broadway, New York, New York 10007, or at  such
other  place  as may be agreed upon by the Transferor,  such
Transferee, the Agent and the Syndicate Agent:

           (a)  the  Transferee shall be a corporation  duly
     organized and existing in good standing under the  laws
     of   the   jurisdiction  of  its   incorporation;   the
     Transferee   shall  have  full  corporate   power   and
     authority  to own its assets, conduct its  business  as
     then being conducted, and enter into and consummate the
     transactions  contemplated hereby and  by  the  Charter
     Documents and the Security Documents to which it  is  a
     party,  and  the Agent or the Syndicate Agent,  as  the
     case  may be, shall have received (1) a certified  copy
     of  the certificate of incorporation of the Transferee,
     (2)  a  certificate of the Secretary of the  Transferee
     attaching  the minutes or resolutions of its  Board  of
     Directors  authorizing  the  transactions  contemplated
     herein,  (3)  a certificate from the Secretary  of  the
     Transferee  or evidencing the authority of the  persons
     executing  the Loan Documents and the Charter Documents
     to  which  it  is a party, to execute and deliver  such
     Loan Documents and Charter Documents and the Transferee
<PAGE>
     to   perform  under  the  Loan  Documents  and  Charter
     Documents to which it is a party, and (4) a certificate
     of  good standing as to the Transferee, all in form and
     substance reasonably satisfactory to the Agent  or  the
     Syndicate  Agent, as the case may be, and  its  special
     counsel;
     
           (b)  the Agent and the Syndicate Agent shall have
     received  no  later than sixty (60) days prior  to  the
     above-referenced  closing,  written  notice  from   the
     Transferor of its intention to cause such Vessel to  be
     acquired  by  the  Transferee in  accordance  with  the
     provisions of this Acquisition Agreement;
     
          (c) the Transferor and the Original Owner, if any,
     acquiring  such  Vessel, shall  have  entered  into  an
     assignment and assumption agreement pursuant  to  which
     the  Transferor  shall have assigned to  such  Original
     Owner, and such Original Owner shall have assumed,  all
     of  the  Transferor's right, title and interest in  and
     to,  and all of the Transferor's obligations under, the
     related   HDW   Shipbuilding   Agreement   or    Daewoo
     Shipbuilding  Agreement, as the case  may  be,  to  the
     extent the same relates to such Vessel;
     
          (d) concurrently with the Transferor's acquisition
     of  any Vessel (following a vessel exchange between the
     Transferor  and an Original Owner), the Transferor  and
     the   Original  Owner  shall  have  entered   into   an
     assignment  agreement, pursuant to which such  Original
     Owner shall have assigned to the Transferor all of such
     Original  Owner's right, title and interest in  and  to
     the   related  HDW  Shipbuilding  Agreement  or  Daewoo
     Shipbuilding  Agreement, as the  case  may  be  to  the
     extent the same relates to such Vessel;
     
          (e) no Event of Default shall have occurred and be
     continuing and no Incipient Default shall have occurred
     and  be continuing and the Transferee shall provide  an
     officer's  certificate  to  such  effect  in  form  and
     substance reasonably satisfactory to the Agent  or  the
     Syndicate  Agent, as the case may be, and  its  special
     counsel;
     
           (f)  there  shall not have occurred any  material
     adverse  change  in  the  financial  condition  of  the
     Transferee  (or any other Transferee that  has  already
     received a Loan that remains outstanding in whole or in
     part)  which  in the reasonable opinion  of  the  Agent
     and/or  the  Syndicate would materially  and  adversely
     affect  the  ability of any such Transferee to  perform
     its obligations as to the repayment of the Facility  by
     the  installments  together with  interest  thereon  as
     herein set out or to perform its obligations under  the
     Loan Documents to which it is or will become a party;
     
           (g)  all  representations and warranties  of  the
     Transferee  (and any other Transferee that has  already
     received a Loan that remains outstanding in whole or in
     part)  contained in this Acquisition Agreement  and  of
     the Charter Guarantor in the Charter Hire Guarantee (if
     a  Charter Hire Guarantee is required hereunder)  being
     true  and  correct  in all material  respects  on  that
     Delivery   Date,   except  insofar   as   they   relate
     exclusively  to  an  earlier date, and  the  Transferee
     shall  provide  officer's certificates confirming  such
     matters;
<PAGE>     
          (h) all governmental and other consents, licenses,
     approvals  and  authorizations, if any,  required  with
     respect to the performance of (i) the Transferee  under
     this Acquisition Agreement and the other Loan Documents
     and  Charter Documents to which it is a party, and (ii)
     the  Transferor and the Charter Guarantor (if a Charter
     Hire   Guarantee  is  required  hereunder)  under  this
     Acquisition Agreement and the other Loan Documents  and
     Charter  Documents to which it is a  party  shall  have
     been  obtained and shall not have been revoked and,  if
     requested  by the Agent or the Syndicate Agent  or  its
     special  counsel, copies of any of the  same  shall  be
     provided;
     
            (i)   all   Uniform  Commercial  Code  financing
     statements  or other document necessary, or  reasonably
     requested  by  the  Agent  or the  Syndicate  Agent  to
     perfect  its  security  interests  under  any  of   the
     Security  Documents and the Charter  Documents  in  the
     United   States   of  America,  the   jurisdiction   of
     registration  of  such  Vessel or  any  other  relevant
     jurisdiction;
     
           (j)  evidence  that  such Vessel  has  been  duly
     registered (i) first in the name and ownership  of  the
     Transferor  and (ii) then in the name and ownership  of
     the Transferee, in each case under the laws and flag of
     the   Republic  of  The  Marshall  Islands,   free   of
     registered liens except the relevant Mortgage(s);
     
           (k)  each  Loan Document and Charter Document  in
     respect  of such Vessel shall have been duly  executed,
     delivered   and,  where  appropriate,   registered   or
     recorded  (together with any documents to  be  executed
     pursuant  to  the  terms  thereof,  including   without
     limitation, notices of the Assignment(s) of Insurance);
     
           (l)  each  of  the  Lenders shall  have  received
     executed originals of the opinions as to the Transferee
     substantially in the form attached as Schedule 4 to the
     Loan Agreement as well as such other opinions from such
     counsel  as  each Lender shall reasonably  request  and
     each  of  the  Lenders  shall have  received  from  its
     special  counsel,  Haight, Gardner, Poor  &  Havens,  a
     favorable  opinion, in form and substance  satisfactory
     to  the  Lenders,  as to such matters incident  to  the
     transactions contemplated hereby as any such Lender may
     reasonably request; and
     
           (m)  all  conditions precedent as  set  forth  in
     Section  7  of  the  Loan  Agreement  shall  have  been
     satisfied.
     
SECTION    4.  Representations and Warranties of Transferees.

     Each of the Transferees represents and warrants to each
of the Lenders that:

          (a) the Transferee is a corporation duly organized
     and validly existing in good standing under the laws of
     its  jurisdiction of incorporation with full  corporate
     power and authority to conduct its business as the same
     is presently conducted;
     
           (b)  the Transferee has legal power and authority
     to   enter  into  and  carry  out  the  terms  of  this
     Acquisition  Agreement  and  each  of  the  other  Loan
<PAGE>
     Documents  and  the  Charter  Documents  to  which  the
     Transferee will be a party;
     
           (c) each of this Acquisition Agreement, the other
     Loan  Documents and the Charter Documents to which  the
     Transferee  will be a party has been (or prior  to  the
     execution  thereof will have been) duly  authorized  by
     all  necessary action, corporate or other, on the  part
     of  the  Transferee,  and  this  Acquisition  Agreement
     constitutes,  and, upon due execution and  delivery  by
     the  Transferee, each of the other Loan  Documents  and
     the  Charter  Documents to which the Transferee  is  or
     will  be  a  party will constitute, in accordance  with
     their   respective  terms,  legal,  valid  and  binding
     instruments enforceable against the Transferee,  except
     to   the   extent  limited  by  applicable  bankruptcy,
     reorganization, insolvency, moratorium or other laws of
     general  application  relating  to  or  affecting   the
     enforcement of creditors, rights from time to  time  in
     effect;
     
            (d)  except  as  previously  disclosed  to   the
     Syndicate Agent and the Agent in writing, there are  no
     actions,  suits  or  proceedings  pending  or,  to  the
     Transferee's   knowledge,   threatened   against    the
     Transferee,  any  of  its  properties  affecting   this
     Acquisition Agreement, the other Loan Documents or  the
     Charter Documents to which the Transferee is or will be
     a  party or the transactions contemplated thereby which
     would  materially and adversely affect the  performance
     of   the   Transferee  of  its  obligations  (if   any)
     thereunder;
     
            (e)   the   consummation  of  the   transactions
     contemplated by, and compliance by the Transferee  with
     all  the  terms  and  provisions of,  this  Acquisition
     Agreement,  the  other Loan Documents and  the  Charter
     Documents to which the Transferee is or will be a party
     will  not violate any provisions of the Certificate  of
     Incorporation or Bylaws of the Transferee and will  not
     result  in a breach of the terms and provisions of,  or
     constitute  a  default under, any  other  agreement  or
     undertaking by the Transferee or by which it or any  of
     its  property  is bound or any order of  any  court  or
     administrative   agency  entered  in  any   proceedings
     binding  on  the Transferee, or violate any  applicable
     statute, rule or regulation;
     
           (f)  the  Transferee is not  in  default  and  no
     condition exists which with notice or lapse of time  or
     both  would constitute a default by the Transferee,  in
     any respect which would materially and adversely affect
     the   ability   of  the  Transferee  to   perform   its
     obligations under this Acquisition Agreement, any other
     Loan   Document,  any  Charter  Document;   under   any
     mortgage,  loan agreement, deed of trust, indenture  or
     other  agreement with respect thereto  or  evidence  of
     indebtedness to which it is a party or by which  it  is
     bound, and is not in violation of or in default, in any
     respect which would materially and adversely affect the
     ability  of  the Transferee to perform its  obligations
     under  this  Acquisition  Agreement,  any  other   Loan
     Document,  or  any Charter Document, under  any  order,
     writ,  judgment or decree of any court,  arbitrator  or
     governmental  authority, commission, board,  agency  or
     instrumentality, domestic or foreign;
     
           (g) the Transferee has only one place of business
<PAGE>
     (which  is  also the location of the place of  business
     that  is  its  chief executive office), which  is  1111
     Broadway, Oakland, California 94607;
     
           (h) the Transferee has no knowledge of any actual
     or  proposed  deficiency  or additional  assessment  in
     connection with any Taxes which either in any  case  or
     in  the  aggregate would be materially adverse  to  the
     Transferee  and  which would materially  and  adversely
     affect  the  ability of the Transferee to  perform  its
     obligations  under this Acquisition Agreement,  any  of
     the   other  Loan  Documents  or  any  of  the  Charter
     Documents;
     
           (i)  all  Taxes  (other than taxes  based  on  or
     measured  by  income and withholding taxes),  liability
     for  the  payment  of which has been  incurred  by  the
     Transferee  in connection with the execution,  delivery
     and  performance  by it of this Acquisition  Agreement,
     each  other Loan Document and Charter Document to which
     it  is  or will be a party, have been paid (or provided
     for  in its accounts if not payable on or prior to  the
     Delivery Date of the respective Vessel);
     
            (j)   all   governmental   consents,   licenses,
     permissions, approvals, registrations or authorizations
     or  declarations required (i) to enable it lawfully  to
     enter into and perform its respective obligations under
     this  Acquisition  Agreement, each of  the  other  Loan
     Documents and each of the Charter Documents to which it
     is  or  will  be  a party and (ii) to ensure  that  its
     respective  obligations hereunder  and  thereunder  are
     legal, valid and enforceable have been obtained or made
     and are in full force and effect or will be obtained or
     made  and  be in full force and effect on the date  any
     such  document  is  executed  and  delivered;  and  all
     governmental     consents,    licenses,    permissions,
     approvals,    registrations   or   authorizations    or
     declarations of the country of registry of each  vessel
     required  (A) to enable it lawfully to enter  into  and
     perform its obligations under the Mortgage(s) to  which
     it  will be a party, (B) to ensure that its obligations
     thereunder are legal, valid and enforceable and (C)  to
     make  the  Mortgage(s) to which  it  will  be  a  party
     admissible  in  evidence in the country in  which  each
     Vessel  is registered and the United States of America,
     will  be  obtained  or made and be in  full  force  and
     effect  on  the date any such Mortgage is executed  and
     delivered;
     
           (k) it has not taken any corporate action nor, to
     its knowledge, have any other steps been taken or legal
     proceedings been started or threatened against  it  for
     its  winding-up, dissolution or reorganization  or  for
     the appointment of a receiver, administrative receiver,
     administrator, trustee or similar officer of it  or  of
     any or all of its respective assets and revenues;
     
           (l)  except  as  provided by applicable  laws  of
     bankruptcy, insolvency, liquidation or similar laws  of
     general   application,  its  obligations   under   this
     Acquisition   Agreement,  each  of   the   other   Loan
     Documents, and, except as otherwise contemplated by the
     Charter  Documents, each of the Charter Documents  rank
     and  will  rank  at  least pari passu  in  priority  of
<PAGE>
     payment,   and  as  to  security  having  the  priority
     contemplated  by the Loan Documents and  in  all  other
     respects with all its respective other indebtedness;
     
           (m) except for registration of the First Mortgage
     on each Vessel (and the assumption of such Mortgage, as
     required) and the Second Mortgage on each Daewoo Vessel
     (and  the  assumption  of such Mortgage,  as  required)
     under the laws and flag of the Republic of The Marshall
     Islands  (including any other Loan Document or  Charter
     Document  required by the laws of the  country  of  the
     mortgaged  vessel's  registry to  be  filed  with  such
     Mortgages), it is not necessary to ensure the legality,
     validity,  enforceability or admissibility in  evidence
     of  this  Acquisition Agreement, any of the other  Loan
     Documents or any of the Charter Documents to  which  it
     is  or  will be a party in the United States of America
     or, to the best of its knowledge, elsewhere or that  it
     be  filed,  recorded or enrolled with any  governmental
     authority or agency in the United States of America or,
     to  the  best of its knowledge, elsewhere, that  it  be
     stamped   with  any  stamp,  registration  or   similar
     transaction tax in the United States of America or,  to
     the best of its knowledge, elsewhere;
     
           (n)  each Transferee is a wholly-owned Subsidiary
     of  the  Transferor; the Transferor is  a  wholly-owned
     Subsidiary of the Charter Guarantor;
     
          (o) the Transferee does not maintain any Plans;
     
          (p) none of the proceeds of the Loans will be used
     to  purchase or carry margin stock within the  meanings
     of  Regulations G, T, U and X of the Board of Governors
     of  the  Federal Reserve System; the Transferee is  not
     engaged  in  the business of extending credit  for  the
     purpose  of purchasing or carrying margin stock  within
     the meaning of Regulations G, T, U or X of the Board of
     Governors of the Federal Reserve System;
     
          (q) it is not an "investment company" or a company
     "controlled"  by an "investment company"  (as  each  of
     such terms is defined or used in the Investment Company
     Act of 1940, as amended);
     
           (r) the Vessel acquired by the Transferee will be
     duly documented in the name of the Transferee under the
     flag of the Republic of The Marshall Islands;
     
           (s) the Vessel acquired by the Transferee will be
     in  the  absolute  and unencumbered  ownership  of  the
     Transferee  except as contemplated by this  Acquisition
     Agreement,  the  other Loan Documents and  the  Charter
     Documents;
     
           (t) the Transferee is, and immediately after  the
     relevant  Lender  advances  its  Commitment  will   be,
     Solvent; and
     
          (u) the Transferor is a wholly-owned Subsidiary of
     the Charter Guarantor.
     
SECTION 5.     Covenants.
<PAGE>
            A.     Affirmative  Covenants.   Each   of   the
     Transferees covenants with each of the Lenders that  it
     shall:
     
          (1)  do  all that is necessary to maintain in full
               force  and effect its corporate existence  in
               good   standing  under  the   laws   of   its
               jurisdiction  of incorporation  and  use  its
               best efforts to obtain, comply with the terms
               of  and  do all that is necessary to maintain
               in  full force and effect all authorizations,
               approvals, licenses and consents required  in
               or   by  the  laws  of  its  jurisdiction  of
               incorporation  and  the  United   States   of
               America  and  any other relevant jurisdiction
               to  enable the Transferee to enter  into  and
               perform   its  obligations  under  the   Loan
               Documents and the Charter Documents to  which
               the  Transferee is or will become a party and
               to    ensure    the    legality,    validity,
               enforceability or admissibility  in  evidence
               in  the United States of America of the  Loan
               Documents and the Charter Documents to  which
               the  Transferee is or will become a party and
               to  comply  with the terms of and to  do  all
               that  is necessary to maintain in full  force
               and  effect  all  authorizations,  approvals,
               licenses and consents required in or  by  the
               national laws of the Republic of The Marshall
               Islands  to  enable the Transferee  to  enter
               into  and  perform its obligations under  the
               Mortgages  to  which it is or will  become  a
               party  and  to ensure the legality, validity,
               enforceability and admissibility in  evidence
               in such country of each such Mortgage;

          (2)  from  time  to  time on the  request  of  the
               Lenders,   but   at  the   expense   of   the
               Transferee, do all such acts and  execute  or
               procure  the execution of all such assurances
               and  documents as the Agent or the  Syndicate
               Agent  may reasonably consider necessary  for
               giving full effect to the Loan Documents  and
               the  Charter Documents to which it is or will
               become   a  party  or  for  more  effectively
               subjecting the security interests  under  the
               Security  Documents and Charter Documents  to
               which  it is or will be a party to the  liens
               of    such   Security   Documents   or   more
               effectively  subject such security  interests
               to the performance of the provisions thereof;
          
          (3)  promptly  inform the Agent and the  Syndicate
               Agent  of  the  occurrence of  any  Incipient
               Default  or  an  Event of  Default  and  upon
               receipt  of a written request from the  Agent
               or  the Syndicate Agent to do so, confirm  to
               the Agent or the Syndicate Agent, as the case
               may  be, that save as previously notified  to
               the Agent or the Syndicate Agent, as the case
               may  be, to the best of the knowledge of  the
               Transferee, no Event of Default has occurred;
          
          (4)  if  the  Transferee's agent  for  service  of
               process  referred to in Section 11 shall  for
<PAGE>
               any  reason  cease  to be validly  appointed,
               ensure  that another such agent is  appointed
               (and ensure that such agent acknowledges such
               appointment to the Agent or Syndicate  Agent,
               as  the  case may be) in a manner  reasonably
               satisfactory  to the Agent or  the  Syndicate
               Agent, as the case may be; and
          
          (5)  the  Transferee shall send to the  Agent  and
               the  Syndicate Agent (i) as soon as possible,
               but in no event later than one hundred twenty
               (120) days after the end of each fiscal year,
               its  accounts of all financial statements  of
               the Transferee, such financial statements  to
               be  prepared  in  accordance  with  generally
               accepted  United States of America accounting
               principles at such time consistently  applied
               all certified as true and correct by a senior
               financial officer of the Transferee, (ii)  as
               soon  as the same is instituted (or,  to  the
               knowledge   of  the  Transferee  threatened),
               details  of  any  litigation, arbitration  or
               administrative   proceedings    against    or
               involving   it  or  the  Vessels   which   if
               adversely  determined would have  a  material
               adverse   effect   on  the   Transferee,   or
               operation of the Vessels, (iii) together with
               the   annual  financial  statements   to   be
               provided in accordance with clause (i)  above
               a  certificate of a financial officer of  the
               Transferee  that  no  Event  of  Default  and
               Incipient   Default  has  occurred   and   is
               continuing, and (iv) from time to  time,  and
               on demand, such additional financial or other
               information  relating to the  Transferee  and
               the Vessels as may be reasonably requested by
               the Agent or the Syndicate Agent.
          
           B.    Negative Covenants. Each of the Transferees
     covenants with each of the Lenders as follows:
     
          (1)  The   Transferee  shall  not  without   prior
               consent of the Agent and the Syndicate  Agent
               consolidate  or  amalgamate  with,  or  merge
               into,  any  other  entity, or  sell,  convey,
               transfer, lease or otherwise dispose  of  all
               or   substantially   all   of   its   assets,
               including,  but not limited to,  by  dividend
               (whether  by one transaction or a  series  of
               transactions  and  whether related  or  not);
               provided, however, that it may consolidate or
               amalgamate  with, or merge  into,  any  other
               entity,  or sell, convey, transfer, lease  or
               otherwise dispose of all or substantially all
               of  its  assets  if  the buyer,  assignee  or
               transferee corporation (the "Assignee") shall
               be   a  solvent  corporation  organized   and
               existing under the laws of the United  States
               of  America  or  any state thereof  following
               such transaction and shall have executed  and
               delivered an agreement, in form and substance
               reasonably satisfactory to the Agent and  the
               Syndicate Agent, containing an assumption  by
               the   Assignee   of  the  due  and   punctual
               performance  and observance of all  covenants
               and  obligations of the Transferee  hereunder
               and  under the other Loan Documents  and  the
               Charter Documents to which it is or shall  be
               a  party, and confirming the accuracy of  any
               representations  and warranties  made  herein
               and  in  each  such other Loan  Document  and
               Charter  Document as of the dates  herein  or
               therein   required  with  respect   to   such
               Assignee;   and    provided   further,   that
               immediately  following such  transaction,  no
               Incipient  Default or Event of Default  shall
               have occurred and be continuing.
          
          (2)  Except for the Charter, the Transferee  shall
               not  charter any HDW Vessel or Daewoo  Vessel
               without  the  prior written approval  of  the
               Agent and the Syndicate Agent, respectively.
          
          (3)  The  Transferee will not create or permit  to
               subsist any lien on the whole or any part  of
               its present or future assets except for liens
               permitted under Section 14 of the Mortgage to
               which it is a party.
          
          (4)  The Transferee shall not make or threaten  to
               make  any substantial changes in its business
               as  presently  conducted, namely  that  of  a
               single purpose corporation owning one of  the
               HDW  or  Daewoo  Vessels and chartering  such
               Vessel  to the Transferor, and the Transferee
               shall not form any subsidiaries.
          
          (5)  The Transferee will not create, incur, assume
               or allow to exist any Financial Indebtedness,
               nor   enter  into  any  financing  lease   or
               undertake  any  material  capital  commitment
               (including but not limited to the purchase of
               any  capital  asset), except as  contemplated
               hereby, without the prior written consent  of
               the  Agent,  in the case of the HDW  Vessels,
               and the Agent and the Syndicate Agent, in the
               case of the Daewoo Vessels.
          
          (6)  The  Transferee  will not make  any  loan  or
               advance  or  extend credit to any  Person  or
               issue   or   enter  into  any  guarantee   or
               indemnity  or  otherwise become  directly  or
               contingently   liable  for  the  obligations,
               stocks  or  dividends of, or  own,  purchase,
               repurchase  or acquire (or agree contingently
               to   do   so)   any  stock,  obligations   or
               securities of, or any other interest  in,  or
               make  any  capital contribution  to,  or  any
               other  investment  in, any  Person,  firm  or
               corporation.  The Transferee will  not  issue
               any capital stock or any options, warrants or
               other  rights with respect to, or  securities
               convertible  into! its capital stock,  except
               to the Transferor.
          
          (7)  The  Transferee will not acquire any  equity,
               share  capital, assets or obligations of  any
               corporation  or  other  entity,   except   as
               contemplated hereby, and it will  not  permit
               any of its voting shares or capital stock  to
               be   held   by  any  party  other  than   the
               Transferor.
          (8)  Without the consent of the Agent in the  case
               of the HDW Vessels and the Syndicate Agent in
               the   case   of   the  Daewoo  Vessels,   the
               Transferee will not amend, repeal  or  modify
               its   Articles  of  Incorporation  or   other
               similar  documents relating to the governance
               of the Transferee.


           C.  Negative Covenant of Transferor. Without  the
     prior  written  consent of the Agent or  the  Syndicate
     Agent,  the Transferor shall not transfer the legal  or
     beneficial ownership, or the control, of any Transferee
     or,  except  as provided in this Acquisition  Agreement
     and   subject  to  the  preceding  clause,  permit  the
     consolidation, amalgamation or merger of any Transferee
     with or into another corporation or entity.
     
SECTION 6.     Release of a Transferee.

      As  provided in Section 5.04(c) of the Loan Agreement,
if  any  HDW  or Daewoo Subportion is paid in full  and  the
Transferee owning the Vessel financed by that Subportion has
the   right  to  have  the  Mortgage  or  Mortgages  thereon
released, that Transferee shall cease being a party to  this
Acquisition  Agreement and shall no longer be bound  by  any
terms and conditions hereof.

SECTION 7.     Third Party Vessel Exchange

      The parties recognize that, in lieu of delivery of APL
THAILAND  or  APL  PHILIPPINES to  an  Original  Owner,  the
Transferor may wish to acquire title to such Vessel from the
applicable  Builder  following  or  incident  to  a   vessel
exchange involving the Transferor and an unaffiliated  third
party, whereupon (i) APL THAILAND or APL PHILIPPINES, as the
case  may be, would be transferred by the Transferor to  APL
Shipholdings,  Ltd.  (formerly named APL  M.V.  Philippines,
Ltd.), a Delaware corporation ("Shipholdings"), which is one
of  the "Transferees" party to the Loan Agreement, and  (ii)
following  transfer  of  that Vessel  to  Shipholdings,  the
Subportion applicable to that Vessel would be drawn down  by
Shipholdings.   As   part  of  such  vessel   exchange   the
Shipbuilding Agreement or the Daewoo Shipbuilding Agreement,
as  applicable,  may be partially assigned (insofar  as  the
Agreement  relates to the Vessel in question) to a financial
institution  acting  as  a qualified intermediary,  provided
that,  notwithstanding such partial assignment,  the  Vessel
shall be delivered by the applicable Builder directly to the
Transferor.

       Notwithstanding  anything  herein  or  in  the   Loan
Agreement to the contrary, it shall be a condition precedent
to  the  right  of Shipholdings to draw down the  Subportion
applicable  to  APL  THAILAND or APL PHILIPPINES  (following
consummation   by  the  Transferor  of  a  vessel   exchange
transaction  involving an unaffiliated third party  and  the
subsequent  transfer  of  the  Vessel  in  question  by  the
Transferor  to Shipholdings) that each of the Lenders  shall
have  consented to such vessel exchange transaction and each
of  the  Lenders,  the Transferor and the Transferees  shall
have   entered  into  any  amendments  to  this  Acquisition
Agreement  and/or  the  other  Operative  Documents  as  may
reasonably  be  required by the Lenders, and the  Transferor
and  the  Transferees shall have furnished  to  the  Lenders
(subject to confidentiality agreements, as the Transferor or
such unaffiliated third party may reasonably require) copies
of documents relating to such vessel exchange transaction as
may reasonably be requested by the Lenders or their counsel.

SECTION 8.     Notices.

      Notices  required or permitted by the  terms  of  this
Acquisition Agreement or any other Loan Document or  Charter
Document  shall be made in accordance with Section 15.04  of
the  Loan  Agreement. Each such notice, if to a  Transferee,
shall be sent to the Transferee at the following address (or
such  other  address  as  that  Transferee  hereafter  shall
designate in a writing delivered to the other parties):

          1111 Broadway
          Oakland, California 94607
          Attn: President

SECTION 9.     Counterparts.

       This   agreement   may   be  executed   in   separate
counterparts,  each  of which, when executed  and  delivered
shall  be  an  original,  but all  such  counterparts  shall
together constitute but one and the same instrument.

SECTION 10.    Modification.

     Neither this Acquisition Agreement nor any of its terms
may be terminated, amended, supplemented, waived or modified
orally, but only by an instrument in writing signed  by  the
party  against  which  the enforcement of  the  termination,
amendment, supplement, waiver or modification is sought.

     So long as any Vessel is subject to a Mortgage, neither
this  Acquisition Agreement nor any of its terms as the same
relate   to   that   Vessel  may  be  terminated,   amended,
supplemented,  waived or modified without the prior  written
consent  of KfW or the Syndicate Agent or the Syndicate,  as
the case may be.

SECTION 11.    Successors and Assigns.

      The  terms  of  this  Acquisition Agreement  shall  be
binding  upon,  and inure to the benefit  of,  each  of  the
parties hereto, and their respective successors and assigns.

SECTION 12.    Governing Law.

      This  Acquisition  Agreement shall  be  construed  and
enforced  in accordance with and governed by the  applicable
law  of  the  State of New York (other than the law  of  the
State  of  New  York  governing choice  of  law),  and  each
Transferee  hereby  submits itself to New York  jurisdiction
and  agrees  to  observe  and  perform  the  agreements  and
covenants  and  shall have the rights contained  in  Section
15.08  of  the Loan Agreement, the provisions of  which  are
hereby  incorporated herein by reference, to the same extent
and  under the same terms and conditions so provided in said
Section 15.08.
SECTION 13.    Assignment.

      The rights of any Party hereunder may not be assigned,
whether  by  operation of law or otherwise,  except  to  the
extent  permitted  by Sections 5.B.(1) of  this  Acquisition
Agreement and Section 10 of the Loan Agreement, without  the
consent of the other parties hereto.

SECTION 14.    Severabilitv.

       If  any  provision  hereof  is  invalid,  illegal  or
unenforceable  in  any jurisdiction, the validity,  legality
and  enforceability of the remaining provisions, and of such
provisions in other jurisdictions, shall not be affected  or
impaired thereby.

SECTION 15.    Table of Contents; Headings.

      The Table of Contents and the headings of the Sections
herein  are  for convenience only and shall not  affect  the
construction or meaning of any provision of this Acquisition
Agreement.

                  [SIGNATURE PAGES FOLLOW]
      IN  WITNESS  WHEREOF,  the parties  have  caused  this
Acquisition   Agreement  to  be  duly  executed   by   their
respective  officers  as of the day  and  year  first  above
written.


                              KREDITANSTALT FUR WIEDERAUFBAU



                              By:_/s/_________________________
                              Name:  Uibeleisen    Pfisterer
                              Title  (Director)   (Vice President)

                              COMMERZBANK AG, HAMBURG



                              By:_/s/_________________________
                              Name:  Kuch
                              Title: Vice President



                              By:_/s/_________________________
                              Name:  J. Hagemann
                              Title: Senior Vice President


                              COMMERZBANK AG (KIEL BRANCH)



                              By:_/s/_________________________
                              Name:  Bahlert
                              Title



                              By:_/s/_________________________
                              Name:  Dr. Plate
                              Title:


                              DRESDNER BANK AG in HAMBURG



                              By:_/s/_________________________
                              Name:  B. Sorge
                              Title: Assistant Manager



                              By:_/s/_________________________
                              Name:  R. Eggert
                              Title: Senior Manager


                              VEREINS-und WESTBANK AG



                              By:_/s/_________________________
                              Name:  VP
                              Title:


                              By:_/s/_________________________
                              Name:  AVP
                              Title:


                              DEUTSCHE SCHIFFSBANK AG



                              By:_/s/__________________________
                              Name: Klaus Pieper
                              Title:Gen. Manager



                              By:_/s/_________________________
                              Name: Wolf Jurgen Onnen
                              Title:Ass. Gen. Mgr.

                              NORDDEUTSCHE LANDESBANK -
                              GIROZENTRALE



                              By:_/s/___________________________
                              Name: Huack
                              Title:Sen. Vice Pres.



                              By:_/s/_________________________
                              Name:  Hartmann
                              Title: Vice Pres.

                              DEUTSCHE  VERKEHRS-BANK   AG (HAMBURG
                              BRANCH)



                              By:_/s/____________________________
                              Name:  Spincke
                              Title: Director


                              By:__________________________
                              Name:
                              Title:


                                 BANQUE INTERNATIONALE A LUXEMBOURG  S.A.



                              By:_/s/_______________/s/___________
                              Name: Jean-Pierre Vernier
                                    Claude Lehnertz

                              Title:Directeur-adjoint
                                    Vice President
                              AMERICAN PRESIDENT LINES, LTD.



                              By:_/s/_____________________________
                              Name:   Thomas R. Meier
                              Title:  Assistant Treasuter


                              M.V. PRESIDENT KENNEDY, LTD.
                              M.V. PRESIDENT ADAMS, LTD.
                              M.V. PRESIDENT JACKSON, LTD.
                              M.V. PRESIDENT POLK, LTD.
                              M.V. PRESIDENT TRUMAN, LTD.
                              APL SHIPHOLDINGS, LTD.



                              By:_/s/____________________________
                              Name:    Thomas R. Meier
                              Title:   Assistant Treasurer
                                                  SCHEDULE 1


                     LIST OF TRANSFEREES


1.   M.V. PRESIDENT KENNEDY, LTD., a Delaware corporation

2.   M.V. PRESIDENT ADAMS, LTD., a Delaware corporation

3.   M.V. PRESIDENT JACKSON, LTD., a Delaware corporation

4.   M.V. PRESIDENT POLK, LTD., a Delaware corporation

5.   M.V. PRESIDENT TRUMAN, LTD., a Delaware corporation

6.   APL SHIPHOLDIDNGS, LTD., a Delaware corporation
                                              EXHIBIT A
                                  TO SECOND AMENDED AND
                                  RESTATED AGREEMENT TO
                                    ACQUIRE AND CHARTER




TO THE EXTENT THAT THIS BAREBOAT CHARTER PARTY
CONSTITUTES CHATTEL PAPER (AS SUCH TERM IS DEFINED IN
THE UNIFORM COMMERCIAL CODE AS IN EFFECT IN ANY
APPLICABLE JURISDICTION), NO SECURITY INTEREST IN THIS
BAREBOAT CHARTER PARTY MAY BE CREATED OR PERFECTED
THROUGH THE TRANSFER OR POSSESSION OF ANY COUNTERPART
OTHER THAN THE ORIGINAL EXECUTED COUNTERPART CONTAINING
THE ACKNOWLEDGMENT THEREOF EXECUTED BY KREDITANSTALT
FUR WIEDERAUFBAU AS AGENT ON THE SIGNATURE PAGE
THEREOF.



                   BAREBOAT CHARTER PARTY
                              
          THIS BAREBOAT CHARTER PARTY (the "Charter")
dated this __th day of __________, 199_, between [
], a corporation organized and existing under the laws
of Delaware (hereinafter "Owner") and American
President Lines, Ltd., a corporation organized and
existing under the laws of Delaware (hereinafter called
"Charterer" or "APL").


                    W I T N E S S E T H:


          WHEREAS, APL has heretofore entered into that
certain Loan Agreement dated March 14, 1994, as amended
by Amendment No. 1 thereto dated May 19, 1995 and as
further amended by Amendment No. 2 thereto dated
September 1, 1995 (the "Loan Agreement"), by and among
APL, Owner, as Borrower, the other "Transferees," as
defined in the Loan Agreement, Kreditanstalt fur
Wiederaufbau (["Vessel Lender" or] "Agent")],
Commerzbank AG (Hamburg) (the OSyndicate AgentO [or
OVessel LenderO]), and the banks listed on Schedule 1
thereto (each a OSyndicate MemberO and collectively the
OSyndicateO), as Lenders, with respect to the purchase
financing of six (6) container vessels, including the
Vessel described below, and American President
Companies, Ltd. (the OCharter GuarantorO) has entered
into that certain Amended and Restated Guarantee dated
May 19, 1995 (the OGuaranteeO), relating to Owner's
obligations under the Loan Agreement as established
pursuant to the below-defined Acquisition Agreement;

          WHEREAS, the date hereof is the Delivery Date
of the below-described Vessel pursuant to the Loan
Agreement;

          WHEREAS, as contemplated by Section 7(k) of
the Loan Agreement, APL has entered into that certain
Second Amended and Restated Agreement to Acquire and
Charter (the OAcquisition AgreementO) among Owner, the
other corporations identified as Transferees therein
and the parties to the Loan Agreement, pursuant to
which Owner has, by an Exchange Agreement dated as of
the date hereof between Owner and the Original Owner
(OExchange AgreementO), accepted title to, and is
currently the registered owner of, the Republic of The
Marshall Islands flag vessel [      ], Official Number
[               ] (the "Vessel") which term shall
include all the boilers, engines, machinery, bowsprits,
masts, spars, sails, riggings, boats, anchors, cables,
apparel, furniture, fittings, equipment and all other
appurtenances to the Vessel appertaining or belonging,
whether now owned or hereafter acquired, whether on
board or not on board, and all additions, improvements
and replacements hereafter made in and to the Vessel,
or any part thereof, or in or to the appurtenances and
equipment aforesaid, but shall exclude leased
equipment), and Owner has undertaken all of the payment
and certain of the performance obligations relating to
Vessel Indebtedness in respect of the Vessel under the
Loan Agreement, as Borrower (as such term is defined in
the Loan Agreement) together with its joint and several
obligations to pay all other Loans made under the [HDW]
[Daewoo] Tranche (as such term is defined in the Loan
Agreement) (collectively, the "Owner Obligations");

          WHEREAS, pursuant to the Exchange Agreement,
Owner has taken title to the Vessel, on its Delivery
Date;

          WHEREAS, Owner has simultaneously herewith
entered into a First Mortgage on the Vessel in favor of
the Vessel Lender, in substantially the form of the
First Mortgage set forth in Appendix B-1 to the Loan
Agreement ("Mortgage") as security for the Owner
Obligations;

          WHEREAS, Owner has agreed to let and demise
the Vessel and Charterer has agreed to hire the Vessel
from Owner, on the terms and conditions set forth in
this Charter, such charter of the Vessel to be
effective upon the execution and delivery of this
Charter;

          WHEREAS, Charter Guarantor simultaneously
herewith is entering into a guarantee of the payment
obligations of Charterer under this Charter in favor of
Owner (the "Charter Hire Guarantee");

          WHEREAS, simultaneously herewith Owner is
entering into the [               ] Charter Assignment
(the "Charter Assignment") relating to the Charter and
the Charter Hire Guarantee in favor of the Vessel
Lender, and Charterer is consenting to such Charter
Assignment pursuant to this Charter and Charter
Guarantor is consenting to such Charter Assignment in
the Charter Hire Guarantee;

          WHEREAS, capitalized terms used herein but
not defined herein shall have the meanings assigned to
them in the Loan Agreement and the Acquisition
Agreement.

          NOW, THEREFORE, in consideration of the
premises and the mutual covenants herein contained, the
receipt and adequacy of which is hereby acknowledged,
Owner and Charterer hereby agree as follows:

     1.   REPRESENTATIONS OF CHARTERER.

          (a)  Charterer is a corporation duly
organized and validly existing in good standing under
the laws of Delaware with full corporate power and
authority to conduct its business as the same is
presently conducted.

          (b)  Charterer has legal power and authority
to enter into and carry out the terms of this Charter.

          (c)  This Charter has been duly authorized by
all necessary action, corporate or other, on the part
of Charterer, and this Charter constitutes, and upon
due execution and delivery by Charterer, the Charter
will constitute, in accordance with its respective
terms, a legal, valid and binding instrument
enforceable against Charterer, except to the extent
limited by applicable bankruptcy, reorganization,
insolvency, moratorium or other laws of general
application relating to or affecting the enforcement of
creditors' rights from time-to-time in effect.

          (d)  Except as previously disclosed to Owner,
the Agent and the Syndicate Agent in writing, there are
no actions, suits or proceedings pending or, to
Charterer's knowledge, threatened against Charterer, or
any of its properties affecting the Charter or the
transactions contemplated thereby which would, if
adversely determined, materially and adversely affect
the performance of Charterer of its obligations
hereunder.

          (e)  The consummation of the transactions
contemplated by, and compliance by Charterer with all
the terms and provisions of, the Charter will not
violate any provisions of the Certificate of
Incorporation or bylaws of Charterer and will not
result in a breach of the terms and provisions of, or
constitute a default under, any other agreement or
undertaking by Charterer or by which it or any of its
property is bound or any order of any court or
administrative agency entered in any proceedings
binding on Charterer, or violate any applicable
statute, rule or regulation.

          (f)  Charterer is not in default and no
condition exists which with notice or lapse of time or
both would constitute a default by Charterer, in any
respect which would materially and adversely affect the
ability of Charterer to perform its obligations under
this Charter, under any mortgage, loan agreement, deed
of trust, indenture or other agreement with respect
thereto or evidence of indebtedness to which it is a
party or by which it is bound, and is not in violation
of or in default, in any respect which would materially
and adversely affect the ability of Charterer to
perform its obligations under this Charter, under any
order, writ, judgment or decree of any court,
arbitrator or governmental authority, commission,
board, agency or instrumentality, domestic or foreign.

          (g)  Charterer has more than one place of
business and the location of the place of business
which is its chief executive office is 1111 Broadway,
Oakland, California 94607.

          (h)  All taxes (other than taxes based on or
measured by income and withholding taxes), liability
for the payment of which has been incurred by Charterer
as such in connection with the execution, delivery and
performance by it of the Charter, have been paid (or
provided for in its accounts if not payable) on or
prior to the delivery date of the Vessel.

          (i)  All consents, licenses, permissions,
approvals, registrations or authorizations or
declarations required by United States of America
federal, state and local governments and the government
of the jurisdiction of incorporation of Charterer and
any applicable foreign jurisdiction (1) to enable it
lawfully to enter into and perform its respective
obligations under this Charter, (2) to ensure that its
obligations hereunder are legal, valid and enforceable,
and (3) to make this Charter admissible in evidence in
the United States of America and such country of
Charterer's incorporation have been obtained or made
and are in full force and effect.

          (j)  It has not taken any corporate action
nor to its knowledge has any other steps been taken or
legal proceedings been started or threatened against it
for its winding-up, dissolution or reorganization or
for the appointment of a receiver, administrative
receiver, administrator, trustee or similar officer of
it or of any or all of its respective assets and
revenues.

          (k)  Charterer represents and warrants that
any representation and warranty made on or prior to the
date hereof by any of its Subsidiaries which is a party
to a Charter in this Charter or in any of the Operative
Documents or by any such Subsidiary in any certificate,
statement or other document issued by and on behalf of
any such Subsidiary is not or was not incorrect or
misleading in any material respect when made or deemed
made.

     2.   PERIOD OF CHARTER AND BASIS OF CHARTER HIRE.

          (a)  Owner agrees to charter and Charterer
agrees to hire the Vessel delivered hereunder on the
terms and conditions herein set forth for a period of
fifteen years from the date hereof with respect to the
Vessel, unless earlier terminated in accordance with
the terms hereof upon payment of all such principal and
interest and such other amounts (said period with
respect to each Vessel hereinafter referred to as its
OCharter PeriodO).

          (b)  Subject to the provisions of Section
24(b)(i) hereof, Charter hire ("Charter Hire") shall be
paid by Charterer to, or for the account of, Owner in
the following two components: (i) "Basic Hire"
consisting of (x) principal and interest due with
respect to the Subportion relating to the Vessel from
the Borrower to the Agent pursuant to Sections 3, 4, 5,
6 and 12 of the Loan Agreement, and the [HDW] [Daewoo]
Notes related to such Subportion issued by Owner
pursuant to Section 4 of the Loan Agreement, at the
times and places, in the manner and to the parties set
forth in said sections and such Notes, including
without limitation the provisions of Section 3.05 with
respect to *, Section 3.08 with respect to default
interest, Section 5.03 with respect to *, and Section
5.04 with respect to prepayment and (y) all indemnity
payments required under Section 11 of the Loan
Agreement when due and payable, and (ii) "Additional
Charter Hire" payable semi-annually at the time of
payment of Basic Hire in an amount equal to the
difference between Basic Hire and an amount for such
semi-annual period calculated at the rate of * per day
for such period; provided that Charter Hire shall
always be in an amount sufficient to cover Basic Hire
and Supplemental Charter Hire.

          At the end of the fifteen-year charter term
provided in Section 2(a) above, Charterer shall have
the right to extend the Charter for up to three
additional one-year periods.  To extend the Charter,
Charterer must give prior written notice of the
one-year extension at least 60 days prior to the end of
the Charter, and, with respect to subsequent periods,
at least 60 days prior to the end of each one-year
extended period.  The extension will be on the same
terms and conditions as the Charter; provided, however,
that the amount of Charter Hire shall be equal to the
fair market charter hire of the Vessel as determined in
good faith by the parties within 30 days prior to the
commencement of any one-year extension.

          (c)  This Charter may not be canceled or
terminated, except in accordance with the expressed
provisions hereof, for any reason whatsoever and
Charterer shall have no right to be relieved or
discharged from obligation or liability under this
Charter except as otherwise expressly provided herein
for any reason whatsoever.  Charterer hereby waives, to
the extent permitted by applicable law, 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, quit or surrender this
Charter except as otherwise expressly provided herein.
Charterer acknowledges and agrees that its obligation
to pay all Basic Hire and Supplemental Charter Hire
pursuant to this Section 2 and all other amounts
payable on behalf of Owner to the Agent pursuant to the
terms of this Charter shall be absolute and
unconditional under any and all circumstances, shall
not be subject to any counterclaim, set-off, deduction,
abatement or defense based upon any claim Charterer may
have against Owner, the Agent, the Syndicate Agent or
any other Lender or any other Person whatsoever, and
shall remain in full force and effect without regard
to, and shall not be released, discharged or in any way
effected by any circumstance or condition (whether or
not Charterer shall have knowledge or notice thereof),
including, without limitation: (i) any amendment or
modification of this Charter, the Loan Agreement, any
agreements relating to any thereof or any other
instrument or agreement applicable to the Vessel or any
part thereof or any assignment or transfer of any
thereof or any furnishing or acceptance of additional
security, or any release of any security, or any
failure or inability to perfect any security; (ii) any
failure on the part of Owner to perform or comply with
any term of this Charter or any failure on the part of
the Agent, the Syndicate Agent or any other Lender to
perform or comply with the terms of the Loan Agreement
or any other instrument agreement applicable thereto;
(iii) any waiver, consent, change, extension,
indulgence or other action or inaction under or in
respect to this Charter or any other such instrument or
agreement, or any exercise or nonexercise of any right,
remedy, power or privilege under or in respect of any
such instrument or agreement; (iv) any bankruptcy,
insolvency, reorganization, arrangement, readjustment,
composition, liquidation or similar proceeding with
respect to Owner, the Agent, the Syndicate Agent,
Charter Guarantor, any Lender or any affiliate of any
of them, or their respective properties or creditors,
or any action taken by any court, trustee, receiver or
liquidating agent in any such proceeding, including,
without limitation, any termination or rejection of
this Charter or any assignment of either thereof by any
court, trustee, receiver or liquidating agent of
Charterer or Owner or of any of their respective
properties in any such proceeding; (v) limitation on
the liability or obligations of Charterer under this
Charter or any termination, or cancellation (except as
expressly provided in this Charter), frustration,
invalidity, irregularity or unenforceability, in whole
or in part, of this Charter or any term hereof or any
lack of power or authority of Charterer or Owner to
enter into this Charter; (vi) any assignment or other
transfer of this Charter by Owner (whether pursuant to
Section 30 hereof or otherwise) or any lien, charge or
encumbrance, from whatever source arising, on or
affecting Charterer's estate in, or any subchartering
of, all or any part of the Vessel (whether or not
pursuant to the express provisions of this Charter or
otherwise); (vii) any damage to, or loss, destruction,
requisition, seizure, forfeiture or marshal's or other
sale of, the Vessel or any exercise of rights with
respect to the Vessel under the Mortgage; (viii) any
libel, attachment, levy, detention, sequestration or
taking into custody of the Vessel, or any interruption
or prevention of or restriction on or interference with
the use or possession of the Vessel; (ix) any title
defect or encumbrance or any dispossession from the
Vessel by title paramount or otherwise; (x) any act,
omission, misrepresentation or breach on the part of
Owner under this Charter or any other agreement at any
time existing between Owner and Charterer, or under any
statute, law or governmental regulation; (xi) any other
circumstance whatsoever which might otherwise
constitute a legal or equitable discharge or defense of
a charterer and irrespective of any other circumstance
which might otherwise limit the recourse against
Charterer; (xii) any defect in the seaworthiness,
condition, design, operation or fitness for use of the
Vessel or the ineligibility of the Vessel for any
particular trade; or (xiii) any other occurrence or
condition whatsoever, foreseen or unforeseen, whether
similar or dissimilar to the foregoing, now existing or
hereafter occurring.

          Even though Charterer shall be deprived of or
limited in the use of the Vessel in any respect or for
any length of time, whether or not by reason of some
act, omission or breach on the part of Owner, Charterer
or any other party, whether or not resulting from
accident and whether or not without fault on the part
of Charterer, Charterer will continue to make all
payments required of Charterer by the terms of this
Charter, whether for Basic Hire, Supplemental Charter
Hire or otherwise, without interruption or abatement,
unless and until this Charter shall have terminated
with respect to the Vessel in accordance with the
express provisions hereof.  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, Charterer nonetheless
agrees to pay an amount equal to each payment of Basic
Hire, Supplemental Charter Hire or other amounts, at
the time such payment would have become due and payable
in accordance with the terms hereof had this Charter
not been terminated in whole or in part.

          Nothing contained in this clause (c) shall be
construed to be a waiver, modification, alteration or
release of any claims which Charterer may have at any
time during the Charter Period or subsequent thereto
for damages or equitable relief, for breach by Owner or
APL of any provisions in any of the Charter Documents
or the Loan Documents, or by the Vessel Lender of any
provisions in any of the Loan Documents, or for any
loss due to any acts taken by any of the parties hereto
or thereto.

          (d)  As supplemental charter hire
(OSupplemental Charter HireO), Charterer shall pay as
and when due any and all amounts (other than principal
and interest on the [HDW] [Daewoo] Notes in respect of
the Subportion relating to the Vessel, including
interest at the Default Interest Rate) payable by Owner
pursuant to the Loan Agreement with respect to the
Subportion relating to each Vessel, at the times and
places, and in the manner and to the parties set forth
in such agreements.

     3.   DELIVERY AND ACCEPTANCE.

          Owner hereby lets, demises and delivers the
Vessel to Charterer and Charterer hereby accepts
delivery of the Vessel, pursuant to the terms of this
Charter.  IT IS AGREED THAT OWNER MAKES NO WARRANTY OR
REPRESENTATION, EITHER EXPRESSED OR IMPLIED, AS TO
TITLE TO, AS TO THE DESIGN, CONDITION, MERCHANTABILITY
OR SEAWORTHINESS OF, AS TO THE QUALITY OF THE MATERIAL,
EQUIPMENT OR WORKMANSHIP IN OR AS TO THE CONSUMABLE
STORES ON BOARD THE VESSEL, OR AS TO THE FITNESS OF THE
VESSEL FOR ANY PARTICULAR PURPOSE OR AS TO THE
ELIGIBILITY OF THE VESSEL FOR ANY PARTICULAR TRADE, OR
ANY OTHER WARRANTY OR REPRESENTATION WHATSOEVER.

     4.   REDELIVERY.

          At the expiration of its Charter Period, the
Vessel (unless lost) shall be redelivered by Charterer
to Owner at the end of the voyage then in progress at a
safe berth to be selected by Owner at a port to be
designated by Owner or another mutually agreed port.

     5.   OPERATING LIMITS.

          Charterer shall have the full use of the
Vessel, and may operate the Vessel throughout the
world, for the carriage of any lawful cargoes in any
lawful trade on voyages for which the Vessel is
suitable and for which insurance is procured by
Charterer and in effect prior to entering such trades.
All necessary insurance required for the trades in
which the Vessel is engaged will be procured by
Charterer pursuant to Section 17 hereof and paid for by
Charterer.

     6.   CONDITION OF VESSEL ON DELIVERY.

          (a)  The Vessel, upon its delivery hereunder,
shall be documented under the laws of the Republic of
The Marshall Islands.  No change will be made in the
registry of the Vessel without the approval of Owner
and compliance by Owner with the terms of Section
(20)(b) of the applicable Mortgage.

          (b)  On its delivery, the Vessel is classed
by the American Bureau of Shipping in the highest
classification and rating for vessels of her age and
type.  On its delivery, the Vessel shall be in good
running order and repair, and will be, insofar as due
diligence shall make it so, strong and well and
sufficiently tackled, apparelled, furnished, equipped
and in good operating condition, ordinary wear and tear
and depreciation excepted.

          (c)  By its acceptance of delivery of the
Vessel, Charterer acknowledges that the Vessel is in
all respects satisfactory to Charterer and such
delivery shall constitute full performance by Owner of
all of Owner's obligations hereunder, relating to the
condition of the Vessel, required to be performed by
Owner prior to the delivery.

     7.   INSPECTIONS.

          (a)  Owner and Charterer shall agree on a
single surveyor appointed for the purpose of
determining and stating in writing the condition of the
Vessel at the time of redelivery.  If not less than ten
(10) days prior to redelivery, Owner and Charterer
shall fail to have agreed on the surveyor to be
appointed for such purpose, either party may request
The American Bureau of Shipping, New York, to make such
appointment, and the surveyor so appointed shall
perform such survey.  The expense of the aforesaid
surveyor shall be shared equally by Owner and
Charterer.  Owner and Charterer may have their own
representative in attendance at all surveys.

          (b)  Prior to redelivery of the Vessel, the
auxiliary machinery, generators, main propulsion units
and boilers may be opened for inspection only by mutual
agreement between Owner and Charterer, in which event
any damage disclosed shall be repaired as may be
required prior to redelivery.  The expense of repair
shall be paid by Charterer.  If no repairs are found
necessary as a result of opening said machinery, the
cost of opening will be borne by the party requesting
the opening.

     8.   MAINTENANCE AND CLASSIFICATION.

          Charterer shall be charged with full
responsibility for maintenance and repair of the Vessel
throughout the Charter Period and shall at all times,
without expense to Owner, maintain and preserve the
Vessel in good running order and repair, so that the
Vessel shall be, insofar as due diligence can make it
so, strong and well and sufficiently tackled,
apparelled, furnished, equipped and supplied and in
every respect seaworthy and good operating condition,
ordinary wear and tear excepted.  Furthermore,
Charterer shall maintain the Vessel so as to enable it
to the highest classification and rating of The
American Bureau of Shipping for vessels of the same age
and type.  On redelivery, any outstanding requirements
shall be taken care of by Charterer, or as Charterer
may otherwise mutually agree with Owner in respect
thereto.  Owner will authorize The American Bureau of
Shipping to release all records to Charterer relating
to the Vessel.

     9.   INVENTORY.

          A complete inventory of the Vessel's entire
outfit, equipment, furniture, furnishings, appliances,
spare and replacement parts whether owned, pooled or
shared with other operators, and of all unbroached
consumable stores and slop chest is warranted by Owner
at delivery.  An inventory shall be taken and mutually
agreed upon by representatives of Charterer and Owner
at the time of redelivery.  The cost of taking such
inventory shall be borne equally by Charterer and
Owner.  Charterer shall pay all shortfalls from the
delivery inventory at the current market prices at the
port of redelivery, except as may be otherwise mutually
agreed.

     10.  FUEL AND LUBRICANTS.

          Charterer shall accept and pay for all fuel
and lubricants in storage tanks on board at the time of
the Vessel's delivery hereunder and, correspondingly,
Owner shall accept and pay for all such fuel and
lubricants in storage tanks left on board at the time
of redelivery.  Each shall pay for fuel and lubricants
in storage tanks at the last invoiced price paid
therefor.

     11.  USE OF EQUIPMENT.

          (a)  Charterer shall have the use of the
Vessel and its outfit, equipment (including cabin,
crew, galley and container lashing equipment),
furniture, furnishings, appliances, spare and
replacement parts on board the Vessel or ashore as
available and shown in the inventory at delivery under
this Charter, and Charterer shall at all times, and at
its own expense, comply with and discharge Owner's
obligations, and shall be entitled to all the benefits
and rights of Owner, under Section (25)(a) of the
Mortgage as to maintenance of the Vessel and its
classification and compliance with all applicable laws,
treaties, conventions, rules and regulations of the
Republic of The Marshall Islands, all in accordance
with the terms of said Section (25)(a).

          (b)  Charterer furnished outfit, equipment
(including cabin, crew, galley and container lashing
equipment), furniture, furnishings, appliances, spare
and replacement parts on board the Vessel and not shown
in the inventory or supplemental inventories as Owner
furnished at the time of delivery shall remain the
property of Charterer, and Charterer at the time of
redelivery shall have the right to remove such items or
at its option may leave such items on board the Vessel.
All items left aboard the Vessel at the termination of
the Charter with respect to the Vessel shall be deemed
abandoned to Owner.

          (c)  Charterer shall be at liberty to fit any
additional equipment required for the services of
Charterer, beyond what is on board at commencement of
Charter with respect to the Vessel, such work to be
done at its time and expense, and such equipment to be
considered its property, and Charterer shall be at
liberty to remove such equipment at its time and
expense during or prior to the expiry of this Charter
with respect to the Vessel; provided that such removal
shall in no way significantly alter the condition of
the Vessel at the time of its redelivery to Owner.  All
additional equipment left aboard the Vessel at the
termination of the Charter shall be deemed abandoned to
Owner.  Charterer shall make no substantial change in
the structure, type or speed of the Vessel or change
its rig without first obtaining the written approval of
Owner and the Vessel Lender; provided, however, that no
such approval need be obtained in respect of any change
which shall be necessary to comply with the
requirements of the United States Coast Guard, the
Republic of The Marshall Islands, or The American
Bureau of Shipping in order to entitle the Vessel to
the classification and rating required above.

     12.  WARRANTY CLAIMS.

          Owner hereby assigns to Charterer Owner's
rights to the extent assignable, under the [HDW]
[Daewoo] Shipbuilding Agreement with respect to the
Vessel with [               ] (the OShipbuilderO)
relating to the condition and performance of the
Vessel, including its replacement and repair warranty
rights under said contract, and, if not assignable,
then Charterer shall be subrogated to all such rights
of Owner, and Owner hereby assigns to Charterer all
Owner's rights with respect to the standby letter of
credit relating to such warranty rights, and it is
agreed that:

          (a)  Charterer may negotiate and process all
warranty claims directly with the Shipyard and shall
provide Owner with prior notice of all warranty claims
whenever reasonably practicable;

          (b)  Owner will cooperate with Charterer in
processing all Vessel warranty claims against the
Shipyard if requested by Charterer; and

          (c)  All fees and expenses incurred to
prosecute or litigate Vessel warranty claims against
the Shipyard shall be borne by Charterer.

     13.  OWNER AND VESSEL LENDER INSPECTIONS.

          Charterer shall at all reasonable times
afford Owner and the Vessel Lender, or their respective
authorized representatives, full and complete access to
the Vessel for the purpose of inspecting or surveying
the same and its papers and, at the request and expense
of Owner or the Vessel Lender, Charterer shall deliver
for inspection by such requesting party copies of any
and all contracts and documents relating to the Vessel,
whether on board or not on board.

     14.  LAY-UP.

          Notwithstanding anything to the contrary in
this Charter, Charterer may at any time during the
period of this Charter, lay-up the Vessel at a safe
place so long as permitted by the applicable Mortgage
in which case Charterer's obligations under this
Charter shall include, during the period of lay-up,
taking the customary precautions for the maintenance
and safety of the Vessel and of paying, in addition to
all other amounts required under this Charter, all
other expenses attributable to such precautions and to
the laying-up of the Vessel.

     15.  CHARTERER TO MAN.

          During the period of this Charter, Charterer
shall at its expense, and by its own procurement, man,
victual, navigate, operate, supply, and fuel the Vessel
and shall pay all charges and expenses of every kind
and nature whatsoever incident to the use and operation
of the Vessel under this Charter.

     16.  CONDITION ON REDELIVERY OF VESSEL.

          (a)  The Vessel shall be redelivered to Owner
(unless lost) pursuant to the terms of this Charter in
all respects in the same condition of operation and
repair as when delivered, except as otherwise provided
herein or mutually agreed, ordinary wear and tear not
affecting class excepted.  Unless otherwise agreed
between the parties and, except as provided in
paragraph (b) of this Section 16, Charterer shall
repair all damages to the Vessel occurring during the
Charter Period, and shall replace all lost, worn out or
otherwise non-operating items, to the extent necessary
to put each Vessel in all respects in the same
condition of operation and repair as when delivered,
ordinary wear and tear not affecting class excepted.
If, at the time of redelivery, repairs, renewals,
replacements or other obligations for which Charterer
is liable remain to be accomplished and it is mutually
agreed between the parties that such items need not be
accomplished before redelivery, Charterer shall pay the
agreed upon cost of such items.  At the redelivery
survey provided for in Section 7 hereof, the surveyor
representing both Charterer and Owner shall determine
and state the repairs or work necessary to place the
Vessel on the date of redelivery in the condition and
class required in this Charter, which statement shall
include all repairs or work required by outstanding
classification requirements of The American Bureau of
Shipping or marine inspection requirements of the
United States Coast Guard, if applicable, in effect
with respect to the Vessel as of the date of the
redelivery to place it in such condition.

          (b)  Owner agrees that upon the redelivery
Charterer shall have no obligation to renew or repair
the Vessel's cell guides, which shall be returned in
Oas is, where isO condition.

     17.  RISK OF LOSS, INSURANCE.

          Charterer hereby assumes all of the risks and
liability resulting from or arising out of Charterer's
possession, use, operation or storage of the Vessel,
and Charterer shall at all times, at its own expense,
comply with and discharge Owner's obligations under
Section (29) of the Mortgage as to the maintenance of
insurance on the Vessel, and shall be entitled to all
the benefits and rights of Owner under said section,
during the Charter Period (and shall, along with Owner
and the Vessel Lender, be named as an assured,
additional assured, and loss payee, as applicable), all
in accordance with the provisions of said section.  In
any case where Charterer shall be obligated to give
notice to the Vessel Lender pursuant to this Section
17, Charterer shall also give simultaneous notice to
Owner.

     18.  ACTUAL OR CONSTRUCTIVE TOTAL LOSS.

          If an Event of Loss shall occur, Charterer
shall (i) give prompt written notice thereof to Owner
and the Vessel Lender, (ii) deposit with the Vessel
Lender for the account of Owner, on or before the
Redemption Date, all amounts required to be paid by
Owner to the Vessel Lender on such date pursuant to
Section 5.04(b)(ii) of the Loan Agreement, (iii) pay to
Owner any insurance proceeds or other compensation, in
excess of its payment obligations pursuant to subclause
(ii) hereof, and (iv) be entitled to the credit
referred to in Section 5.04(b)(iii) with respect to its
payment obligations pursuant to subclause (ii) hereof.
Upon Charterer's payment pursuant to subclause (ii)
hereof (to the extent modified by subclause (iv)
hereof), this Charter shall terminate.

     19.  BILLS OF LADING.

          Charterer shall utilize its customary
contracts of affreightment, including its long form and
short form bills of lading, the standard form of
Military Sealift Command Shipping Agreement, and cargo
charter parties all of which foregoing documents shall
include Clause Paramount, Liberties Clause, General
Average Clause, New Jason Clause, and Both-to-Blame
Collision Clause.

     20.  GENERAL AND PARTICULAR AVERAGE.

          Average adjusters, appointed by Charterer
from a list of adjusters satisfactory to Owner, shall
attend to the settlement and collection of both general
and particular average losses subject to the customary
charges.  Charterer agrees to assist the adjuster in
preparing the average statement and to take all other
possible measures to protect the interests of the
Vessel and Owner.

     21.  SALVAGE.

          All earned salvage will be for Charterer's
account.

     22.  LIENS.

          (a)  Neither Charterer nor the Master of the
Vessel nor any other Person shall have the right,
power, or authority to create, incur or permit to be
placed upon the Vessel any liens whatsoever other than
those permitted by Section 14 of the Mortgage, and
shall hold harmless and indemnify Owner and the Vessel
Lender against the claims and demands of all Persons
whomsoever arising as a result of any mortgage,
security interest, lien or charge whatsoever on the
Vessel, except that such undertaking by Charterer shall
not apply to the lien of the Mortgage.

          (b)  Charterer shall at all times, at its own
cost and expense, comply with and discharge Owner's
obligations under Sections (15), (16) and (22) of the
Mortgage with respect to the release and discharge of
any lien or levy against the Vessel, and shall give
notice to Owner if it shall be required to give notice
to the Vessel Lender pursuant to said Section (16).

          (c)  Charterer agrees to carry a properly
certified copy of this Charter and the Mortgage with
the ship's papers on board the Vessel, and agrees to
exhibit the same to any person having business with
such Vessel and to any representative of the Vessel
Lender, and agrees also to exhibit the same to any
representative of Owner on demand.

          (d)  Charterer further agrees to fasten in
the Vessel in a prominent place, and to maintain during
the Charter Period a framed printed or typewritten
notice in plain type and which shall cover a space of
not less than six (6) inches wide by nine (9) inches
high (or of such other dimensions as may be required by
law) reading substantially as follows:

                 ONOTICE OF FIRST PREFERRED
                  SHIP MORTGAGE AND CHARTER

     THIS VESSEL IS OWNED BY M.V. PRESIDENT KENNEDY,
     LTD., A DELAWARE CORPORATION (THE OSHIPOWNERO),
     AND IS CHARTERED BY AMERICAN PRESIDENT LINES,
     LTD., A DELAWARE CORPORATION, AND IS COVERED BY A
     FIRST PREFERRED SHIP MORTGAGE IN FAVOR OF
     KREDITANSTALT FUR WIEDERAUFBAU, UNDER AUTHORITY OF
     THE REPUBLIC OF THE MARSHALL ISLANDS.  UNDER THE
     TERMS OF SAID MORTGAGE AND CHARTER, NEITHER THE
     SHIPOWNER, ANY CHARTERER, THE MASTER OF THE VESSEL
     NOR ANY OTHER PERSON, HAS ANY RIGHT, POWER OR
     AUTHORITY TO CREATE, INCUR OR PERMIT TO BE PLACED
     OR IMPOSED UPON THIS VESSEL ANY LIEN WHATSOEVER
     OTHER THAN THE LIEN OF SAID MORTGAGE AND LIENS FOR
     WAGES OF A STEVEDORE WHEN EMPLOYED DIRECTLY BY THE
     SHIPOWNER, OPERATOR, MASTER, OR ANY AGENT OF THE
     VESSEL, FOR CREW'S WAGES, FOR GENERAL AVERAGE, FOR
     SALVAGE, AND, TO THE EXTENT SUBORDINATE TO THE
     LIEN OF SAID MORTGAGE, FOR CERTAIN LIENS INCIDENT
     TO CURRENT OPERATIONS OR FOR REPAIRS OR CHANGES
     PERMITTED BY THE MORTGAGE.O

     23.  TRANSFER OF ASSIGNMENT.

          Charterer shall not, without Owner's and the
Vessel Lender's prior written consent, sell, demise,
charter, transfer, or assign this Charter or any
interest therein, or, without such consent, make any
arrangement whereby the maintenance, management, or
operation of the Vessel is to be performed by any other
person, except with respect to requisition or other
governmental taking, and except that Charterer may
subcharter the Vessel on a time basis as long as
Charterer shall, at its own cost and expense, comply
with Section 9.02(b) of the Loan Agreement; provided
that, notwithstanding such subcharter, Charterer
remains fully liable for all of its obligations under
the Charter Documents.  Charterer shall have the right
to voyage charter the Vessel, or to arrange for space
or slot charters of a portion of the Vessel in
connection with Charterer's normal liner service.

     24.  EVENTS OF DEFAULT AND REMEDIES.

          (a)  The following shall constitute an event
of default under this Charter (hereinafter called a
OEvent of DefaultO):

          (i) Charterer's failure to pay the whole or
          any part of any Charter Hire or Supplemental
          Charter Hire under the terms of this Charter
          and such default remains unremedied for three
          (3) Business Days after the due date thereof;
          or

          (ii) default by Charterer in the due and
          punctual observance and performance of
          Charterer's obligations under SECTION 22, the
          third sentence of SECTION 25, SECTION 26(b),
          c), (d) or (g) of this Charter, Sections
          15(b), 16, 21(y) and (z), 23, 29(a), (b), (f)
          and (j) of the Mortgage (and to the extent
          that such default exposes the Vessel to
          forfeiture, Sections 21(x) and 22 of the
          Mortgage); or

          (iii) any insurance on the Vessel required to
          be maintained by Charterer in performance of
          Owner's obligations is canceled due to non-
          payment of premiums and otherwise not
          immediately replaced or the Vessel otherwise
          ceases to be insured in accordance with the
          provisions of the Mortgage on the Vessel; or

          (iv) default by Charterer (other than as
          specified in paragraphs (ii) and (iii) of
          this SECTION 24(a) in the due and punctual
          performance of Owner's obligations under
          SECTION 26(e), (f), (g), (h) and (i) of this
          Charter and Charter's performance of Owner's
          obligations under Sections 18, 21, 22, 24,
          25, 26, 28, 50(a) and (b) and 51 of the
          Mortgage, in each case, which shall continue
          for thirty (30) days after written notice
          from the Agent, Owner or Charter Guarantor.

          (v) an "Event of Default" under any other
          [HDW] [Daewoo] Charter or under any [HDW]
          [Daewoo] Charter.

          (vi) Charterer or Charter Guarantor is in
          breach in the performance or observance of
          this Charter, the Charter Hire Guarantee or
          any other of the Operative Documents to which
          either of them is a party (not being a
          default which falls within paragraphs (i),
          (ii), (iii), (iv) or (v) of this SECTION
          24(a)) and if it is capable of being remedied
          and such breach is not remedied within thirty
          (30) days after receipt by Charterer of
          notice of such breach from Owner or (so long
          as the Mortgage is in effect), the Agent; or

          (vii) Charterer or any of its Subsidiaries
          which is a party to a Charter or Charter
          Guarantor is in default in the payment when
          due of any sum or sums which aggregate in
          excess of Five Million Dollars (USD5,000,000)
          at any one time under any documentation
          relating to any other Financial Indebtedness
          whatsoever (excluding for this purpose the
          HDW Tranche and the Daewoo Tranche), and such
          Financial Indebtedness shall have been
          accelerated in accordance with the terms
          thereof; or

          (viii) there is a final, unappealable and
          enforceable judgment made against Charterer,
          any of Charterer's Subsidiaries which is a
          party to a Charter or Charter Guarantor
          greater than 5% of the Tangible Net Worth of
          Charter Guarantor; or

          (ix) any representation or warranty made by
          or on behalf of Charterer or Charter
          Guarantor in this Charter or in any of the
          Operative Documents or by Charterer or
          Charter Guarantor in any certificate,
          statement or other document issued by or on
          behalf of Charterer or Charter Guarantor
          pursuant to any of the Operative Documents
          shall prove to have been incorrect or
          misleading in any material respect when made
          or deemed made; or

          (x) without the prior written consent of
          Owner and (so long as the Mortgage remains in
          effect) the Agent, there is a merger of
          Charterer or Charter Guarantor otherwise than
          as permitted under the Operative Documents;
          or

          (xi) any license, authorization, consent or
          approval at any time necessary to enable
          Charterer or Charter Guarantor to comply with
          its obligations under this Charter, the
          Charter Guarantee or any of the other
          Operative Documents is revoked or not granted
          or fails to remain in full force and effect
          for a period of thirty (30) days after notice
          thereof from Owner and (while the Mortgage is
          in effect) the Agent with respect to the
          Vessel; or
          
          (xii) Charterer or Charter Guarantor shall
          (i) file, or consent by answer or otherwise
          to the filing against it of, a petition for
          relief or reorganization or arrangement or
          any other petition in bankruptcy, for
          liquidation or seek any relief or forbearance
          under any bankruptcy or insolvency or other
          similar law, (ii) make an assignment for the
          benefit of creditors, or (iii) consent to the
          appointment of a custodian, receiver, trustee
          or other officer with similar powers with
          respect to itself or any substantial part of
          its property; or

          (xiii) a court or governmental authority of
          competent jurisdiction in an involuntary case
          under applicable bankruptcy laws, as now or
          hereafter constituted, or any insolvency or
          similar law, shall enter an order appointing,
          without consent by Charterer or Charter
          Guarantor, a custodian, receiver, trustee or
          other officer with similar powers with
          respect to Charterer or Charter Guarantor or
          with respect to any substantial part of
          Charterer's or Charter Guarantor's property,
          or constituting an order for relief or
          approving a petition for relief or
          reorganization or any other petition in
          bankruptcy or for liquidation or to take
          advantage of any bankruptcy or insolvency law
          of any jurisdiction, or ordering the
          dissolution, winding-up or liquidation of
          Charterer or Charter Guarantor, and any such
          order or petition is not dismissed or stayed
          within sixty (60) days after the earlier of
          the entering of any such order or the
          approval of any such petition; or

          (xiv) default by Charterer of its obligations
          under SECTION 26(a) of this Charter.

          (b)  If an Event of Default shall have
occurred and be continuing:

          (i) Upon declaration by Owner by notice in
          writing to Charterer, Owner shall be
          immediately entitled to payment of all
          amounts which are due and payable under this
          Charter and, as damages for loss of a bargain
          and not as a penalty, whichever in the
          following amounts Owner, in its sole
          discretion, shall specify: (A) that sum with
          respect to the Vessel which shall be equal to
          the excess, if any, of (1) the present value
          of the unpaid balance of total Charter Hire
          which would otherwise have been paid over the
          Charter Period but for such declaration by
          Owner, discounted a rate of 6% per annum over
          (2) the fair market rental value of the
          Vessel, as determined by Owner, for the
          period from the date of such Owner's
          declaration to the date the Charter would
          have terminated but for such declaration, or
          (B) that sum with respect to the Vessel which
          shall be equal to the excess, if any, of (1)
          the amount specified in subclause A (1) above
          over (2) the amount Owner estimates to be the
          fair market sale value of the Vessel;
          provided that, (C) in the event Owner shall
          have sold the Vessel, in lieu of collecting
          any amounts payable to Owner by Charterer
          pursuant to the preceding clauses (A) or (B)
          of this Section 24(b)(i), Owner, if it shall
          so elect, may demand that Charterer pay
          Owner, as liquidated damages for loss of a
          bargain and not as a penalty, an amount equal
          to the excess, if any, of (1) the amount
          specified in subclause A(1) above over (2)
          the net proceeds of such sale, plus interest
          on the unpaid balance of any such excess
          amounts immediately payable to Owner by
          Charterer pursuant to clauses (A), (B) or (C)
          at the Default Interest Rate commencing on
          the date of such declaration by Owner to the
          date of payment; provided, further, if an
          Event of Default hereunder shall have
          occurred and be continuing hereunder and if
          the Vessel Lender shall have declared or
          shall have been deemed to have declared the
          whole or any part of the outstanding
          principal amount of the [HDW] [Daewoo] Notes
          with respect to the Subportion relating to
          the Vessel to be immediately due and payable
          by Owner pursuant to Section 12.01 of the
          Loan Agreement and Section (31) of the
          Mortgage, the amount immediately payable
          hereunder shall in all events be not less
          than the principal amount and interest on
          such accelerated [HDW] [Daewoo] Notes
          together with interest from the date of such
          declaration to the date of payment on overdue
          principal at the Default Interest Rate plus
          any other amounts comprising Basic Hire due
          and payable;

          (ii) Upon such declaration or deemed
          declaration of acceleration pursuant to
          clause (i) hereof, Owner may:

               (A)  Institute and prosecute any
          judicial, extra judicial, or administrative
          proceedings as it may consider appropriate to
          recover any or all sums due, or declared due,
          with respect to Charter Hire and with respect
          to any Supplemental Charter Hire due, with
          the right to enforce payment of said sums
          against any assets of Charterer;

               (B)  Owner may take possession of the
          Vessel, with or without legal proceedings, at
          any place where the Vessel may be found (and
          Charterer shall forthwith surrender
          possession of the Vessel to Owner on demand);
          and

               (C)  Owner may terminate Charterer's
          rights under this Charter.

          (c)  In case there shall be pending
proceedings for the bankruptcy or for the
reorganization of Charterer under any applicable law or
in connection with the insolvency of Charterer or in
case a receiver or trustee shall have been appointed
for its property or its creditors, Owner, irrespective
of whether Charter Hire shall then be due and payable
as herein expressed or by declaration of acceleration
or otherwise, shall be entitled and empowered to
intervene in such proceedings or otherwise, to file and
prove a claim or claims for the whole amount of Charter
Hire or Supplemental Charter Hire owing and unpaid, and
to file such other papers or documents as may be
necessary or advisable in order to have the claims of
Owner allowed in any judicial proceeding relative to
Charterer, its creditors, or its property, and to
collect and receive any money or other property payable
or deliverable on any such claims.  Nothing contained
in this Charter shall be deemed to give Owner any right
to accept or consent to any plan of reorganization or
otherwise by action of any character in any such
proceeding to waive or change in any way any right of
any Holder.

          (d)  No right or remedy herein conferred upon
or reserved to Owner is intended to be exclusive of any
other right or remedy, and every right and remedy
shall, to the extent permitted by law, be cumulative
and, in addition to every other right and remedy given
hereunder or under the other Charter Documents or now
or hereafter existing at law, in equity, in admiralty,
by statute or otherwise.  The assertion or employment
of any right or remedy hereunder or otherwise shall not
prevent the concurrent or subsequent assertion or
employment of any other right or remedy hereunder or
otherwise.

          (e)  No delay or omission of Owner to
exercise any right or remedy accruing upon any Event of
Default nor any course of dealings between Owner and
Charterer shall impair any such right or remedy or
constitute a waiver of any Event of Default or an
acquiescence therein nor shall any single exercise or
partial exercise of any such right or remedy preclude
any other exercise thereof or any exercise of any other
or further right or remedy; nor shall the acceptance by
Owner of any security or any payment of any part of
Charter Hire or Supplemental Charter Hire maturing
after any Event of Default or of any payment on account
of any past default be construed to be a waiver of any
right to take advantage of any future Event of Default
or of any past Event of Default not completely cured
thereby.  Every right or remedy given by this Charter
or any other Charter Document or by law to Owner may be
exercised from time-to-time, and as often and in such
order as may be deemed expedient, by Owner.

          (f)  In case Owner shall have proceeded to
enforce any right, power or remedy under this Charter
or under any other Charter Document, and such
proceeding shall have been discontinued or abandoned
for any reason or shall have been adversely determined
to Owner, then, and in every such case, Charterer and
Owner shall be restored to their former positions and
rights hereunder with respect to the property subject
or intended to be subject to this Charter or any other
Charter Documents, as the case may be, and all rights,
remedies and powers of Owner shall continue as if no
such proceedings had been taken.

          (g)  Subject to the provisions of Section
24(b) hereof, Owner shall have the right to direct the
time, method and place of conducting any proceeding for
any remedy available to Owner under this Charter or any
other Charter Document.

          (h)  Charterer hereby expressly waives demand
and presentment for payment, notice of nonpayment,
protest, notice of protest, notice of dishonor,
bringing of suit, and diligence in taking any action to
collect amounts called for under this Charter at any
time in connection herewith.

          (i)  No right or remedy herein conferred upon
or reserved to Owner is intended to be exclusive, but
cumulative and in addition to any other right and
remedy given hereunder or under the other Charter
Documents.

     25.  SPECIAL CONDITIONS; SUBORDINATION TO THE LIEN
OF THE MORTGAGE.

          (a)  During the period of this Charter,
Charterer may substitute its own stack marks and
insignia for those of Owner on the Vessel.

          (b)  Owner shall effect initial registry of
the Vessel in the official name designated by
Charterer.

          (c)  This Charter and each and every
provision hereof shall be subject and subordinate to
each and every provision of the Mortgage in each and
every right and any remedy of any party hereto is
subject and subordinate to each and every right and
remedy of any party to the Mortgage.  Any lien of
Charterer against the Vessel for breach of this Charter
(whether pleaded and proved as a tort or otherwise)
shall be subject and subordinate to the lien of the
Mortgage.  Charterer agrees not to take any action
under this Charter or otherwise which would violate, or
cause Owner to violate, any provisions of the Mortgage.
Charterer shall establish and maintain, or if
appropriate, require Owner to establish and maintain
(i) the Mortgage and any Replacement Mortgage(s) to be
valid and enforceable and duly registered on the Vessel
having the priority of record required under the terms
of the Operative Documents, (ii) each Security
Document, and the liens or security interests created
or intended to be created thereunder to be and remain
in full force and effect.  Owner agrees to execute such
documents and furnish such information as Charterer may
request in order to assist Charterer in the discharge
of Charterer's obligations as set forth in the
preceding sentence of this Section 25.  In addition to
all other obligations assumed by Charterer hereunder,
Charterer will at all times, and at its own expense,
comply with and discharge Owner's obligations, and
shall be entitled to all the benefits and rights of
Owner, under the following sections of the Mortgage,
all in accordance with the provisions of said sections:
(i) Section (18) with respect to notice of Events of
Default, (ii) Section (21) with respect to operation of
the Vessel in accordance with law, (iii) Section (23)
with respect to the maintenance of the Mortgage, (iv)
Section 25(c) with respect to dealing with the Vessel's
equipment (in connection with which Charterer may act
without Owner's consent whenever Mortgagee consent is
not required), and (v) Sections (28), (50)(a) and (b)
and (51) with respect to the payment or reimbursement
of expenses.

     26.  COVENANTS OF CHARTERER.

          Charterer shall take whatever action is
necessary (not contrary to applicable law and not
contrary to the maintenance of the separate corporate
status of each of such Subsidiaries) as to any of its
Subsidiaries which is a party to a Charter, to:

          (a)  prevent any of such Subsidiaries from
voluntarily or involuntarily committing or being
subjected to an OEvent of BankruptcyO and will not
suffer any of such Subsidiaries voluntarily or
involuntarily to commit or be subjected to an Event of
Bankruptcy.  For the purposes of this SECTION 26(a), an
"Event of Bankruptcy" shall mean any of the events
relating to such Subsidiaries described in SECTION
24(a)(xii) and (xiii) of this Charter;

          (b)  cause any of such Subsidiaries not to
breach any of its representations and warranties as to
ownership, possession, mortgages, security interests
and lien status and its obligations to defend and hold
harmless the Mortgagee of such Vessels in respect
thereof as required under the first paragraph of
Section 14 of the Mortgages;

          (c)  prevent, and not suffer any of such
Subsidiaries to, breach any of such Subsidiaries'
obligations under Section 17 of the Mortgage;

          (d)  prevent, and not suffer any of such
Subsidiaries, to breach any of such Subsidiaries'
representations and warranties under Section 20(a) of
the Mortgage;

          (e)  cause such Subsidiaries faithfully to
observe all covenants and conditions set forth in
Section 20(b) and (c) of the Mortgage;

          (f)  cause such Subsidiaries to comply
faithfully with the provisions of Section 25 of the
Mortgage;

          (g)  cause such Subsidiaries to comply
faithfully with the provisions of Section 27 of the
Mortgage;

          (h)  cause such Subsidiaries to obtain and
maintain in full force and effect all licenses,
authorizations, consents and approvals to enable them
to comply with their obligations under this Charter and
the other Operative Documents;

          (i)  cause such Subsidiaries to remedy any
breach of any of the Operative Documents not mentioned
in paragraphs (a) through (h) of this SECTION 26,
except the failure or breach of any of such
Subsidiaries to pay Vessel Indebtedness in respect of
any Vessel.

     27.  OWNERSHIP.

          So long as this Charter shall be in effect,
Charterer's interest in the Vessel shall be solely that
of a bareboat charterer.  There shall be no option to
purchase or other right to acquire a legal or equitable
ownership interest in the Vessel permitted or impled so
long as this Charter shall be in effect. Any contract
or implied right of Charterer to a legal or equitable
interest in the Vessel made or given while this Charter
is in effect shall be void and unenforceable.

     28.  AMENDMENT.

          This Charter shall be binding upon, in or to
the benefit of and enforceable by the parties hereto
and their respective successors and assigns.  Neither
this Charter nor any provision hereof may be amended,
modified, waived, discharged or terminated orally, but
only by an instrument in writing signed by the party
against which enforcement of the amendment,
modification, waiver, discharge or termination is
sought; provided that no such amendment, modification,
waiver, discharge or termination shall be made without
the prior written consent of the Vessel Lender.

     29.  APPLICABLE LAW.

          This Charter shall be construed and governed
in accordance with the admiralty and maritime law of
the United States of America and where applicable the
law of the State of New York (other than the law of the
State of New York governing choice of law).

     30.  NOTICES.

          All notices or other communications by either
party to the other shall be in writing.  If such notice
is to Charterer, it shall be addressed to:

          American President Lines, Ltd.
          1111 Broadway
          Oakland, CA 94607
          Telephone:     (510) 272-8000
          Facsimile:     (510) 272-8932
          Telex:         671 4840
          Answerback:    APL OAK
          Attention:     Treasurer

          If to Owner, it shall be addressed to:

          M.V. President Kennedy, Ltd.
          1111 Broadway
          Oakland, CA 94607
          Telephone:     (510) 272-8000
          Facsimile:     (510) 272-8932
          Telex:         671 4840
          Answerback:    APL OAK
          Attention:     Treasurer

          Any notices or communications provided for
     herein shall be deemed to have been given, unless
     otherwise expressly provided herein, at the time
     of mailing when (in the case of telex) the
     addressee's answerback shall have been received at
     the end of the transmission thereof or (in the
     case of any letter) when delivered to that address
     by facsimile or personally) or when actually
     received by the relevant party after being
     deposited in the post, first class, postage
     prepaid, in an envelope addressed as above.  Any
     party shall have the right to change the address
     at which it is to receive notices upon fifteen
     (15) days prior written notice.

     31.  CONSENT TO ASSIGNMENT.

          Charterer hereby consents to the assignment
of all of Owner's rights, title and interest in and to
this Charter to the Vessel Lender pursuant to the [
] Charter Assignment as security for the payment and
performance of the Owner Obligations with respect to
the Vessel and agrees to make all payments due
hereunder to the accounts specified and otherwise in
accordance with Section 5.06 of the Loan Agreement,
except that so long as no Event of Default shall have
occurred and be continuing, Charterer may make payments
of Additional Charter Hire directly to Owner.

     IN WITNESS WHEREOF, the parties hereto have caused
this Charter to be executed the day and year first
above written.

                                [               ],
                                      as Owner
                                
                                By:
                                __________________________                    
                                    Title:
                                
                                AMERICAN PRESIDENT
                                LINES, LTD.,
                                         as Charterer
                                
                                By:
                                ___________________________
                                     Title:
                                
RECEIPT OF ORIGINAL EXECUTED
COUNTERPART ACKNOWLEDGED:

     [    ]

     By: _______________________________
                                            EXHIBIT A-1
                                  TO SECOND AMENDED AND
                                  RESTATED AGREEMENT TO
                                    ACQUIRE AND CHARTER


     Omitted pursuant to Instruction 2 to Item 601 of
Regulation S-K.  Same as Exhibit I to Exhibit A to the
Agreement to Acquire and Charter filed as Exhibit 10.6
with Registrant's Form 10-Q for the quarter ended April
8, 1994, except the recitals refer to the Second
Amended and Restated Agreement to Acquire and Charter
dated September 1, 1995 and related documents.
                                            EXHIBIT B-1
                                  TO SECOND AMENDED AND
                                  RESTATED AGREEMENT TO
                                    ACQUIRE AND CHARTER


                      __________, 199 _


Kreditanstalt fur Wiederaufbau
Palmengartenstrasse 5-9
60325 Frankfurt am Main
Federal Republic of Germany

     RE:  Container Vessel Named __________,
          Identified by Howaldtswerke-Deutsche Werft AG
          (the OContractorO) as Contractor's Hull
          No. [297] [298] [299] (the "Vessel") - B IV a
          F(W) 753

Dear Sirs:

     We refer to a Second Amended and Restated
Agreement to Acquire and Charter (the OAcquisition
AgreementO) dated as of September 1, 1995, and made
between yourselves as Agent and Lender and ourselves as
Transferee (among other parties).  Terms defined in the
Acquisition Agreement have the same meanings herein.

     In relation to the Vessel, we hereby confirm that
we are ready to take delivery of and accept the Vessel
pursuant to [the Acquisition Agreement] [that certain
Exchange Agreement dated as of the date hereof between
__________ and ourselves].

     We also confirm that the Vessel is recommended for
class "__________" with The American Bureau of Shipping
as per the photocopy or duplicate interim
classification certificate attached hereto, and that
there is no lien or encumbrance on the Vessel.

                                Yours faithfully,
                                
                                [NAME OF TRANSFEREE]
                                
                                
                                By:
                                ___________________________
                                     Name:
                                     Title:

Attachment
                                            EXHIBIT B-2
                                  TO SECOND AMENDED AND
                                  RESTATED AGREEMENT TO
                                    ACQUIRE AND CHARTER


                      __________, 199 _


Commerzbank AG
Ness 7-9
D-20457 Hamburg
Federal Republic of Germany

     RE:  Container Vessel Named __________,
          Identified by Daewoo Shipbuilding & Heavy
          Machinery,
          Ltd. (the OContractorO) as Contractor's Hull
          No. [4028] [4029] [4033] (the OVesselO) - B
          IV a F(W)
          753

Dear Sirs:

     We refer to a Second Amended and Restated
Agreement to Acquire and Charter (the "Acquisition
Agreement") dated as of September l, 1995, and made
between yourselves as Syndicate Agent and ourselves as
Transferee (among other parties).  Terms defined in the
Acquisition Agreement have the same meanings herein.

     In relation to the Vessel, we hereby confirm that
we are ready to take delivery of and accept the Vessel
pursuant to the [Acquisition Agreement] [that certain
Exchange Agreement dated as of the date hereof between
__________ and ourselves].

     We also confirm that the Vessel is recommended for
class "__________" with The American Bureau of Shipping
as per the photocopy or duplicate interim
classification certificate attached hereto, and that
there is no lien or encumbrance on the Vessel.

                                Yours faithfully,
                                
                                [NAME OF TRANSFEREE]
                                
                                
                                By:
                                ____________________________
                                     Name:
                                     Title:

Attachment

                                              EXHIBIT C
                                  TO SECOND AMENDED AND
                                  RESTATED AGREEMENT TO
                                    ACQUIRE AND CHARTER







         [HDW] [DAEWOO] [SECOND] CHARTER ASSIGNMENT
                              
                              From

               [                   ], Assignor

                              To

               [                   ], Assignee


                    Dated: ____________, 199_


         [HDW] [DAEWOO] [SECOND] CHARTER ASSIGNMENT
                              
     This [Second] Charter Assignment dated , 199_ is
made between (i) [        ], a Delaware corporation
(the "Assignor") and (ii) [       ], a [        ] (the
"Assignee").

                    W I T N E S S E T H:
                              
     WHEREAS, American President Lines, Ltd. ("APL"), a
wholly-owned subsidiary of American President
Companies, Ltd. ("APC"), has heretofore entered into
that certain Loan Agreement dated March 14, 1994, as
amended by Amendment No.1 thereto dated May 19, 1995,
as further amended by Amendment No. 2 thereto dated
September 1, 1995 (as the same may be further amended
or supplemented in accordance with its terms, the "Loan
Agreement"), by and among APL, the Assignor, the other
corporations identified as Transferees therein, the
Assignee, [Kreditanstalt fur Wiederaufbau ("KfW")]
[Commerzbank AG, Hamburg (the Syndicate Agent)], and
the banks listed on Schedule I thereto (each a
"Syndicate Member" and collectively the "Syndicate")
with respect to the purchase financing of six (6)
container vessels, including the Vessel described
below;

     WHEREAS, in accordance with the Loan Agreement and
that certain Second Amended and Restated Agreement to
Acquire and Charter dated September 1, 1995 (as the
same may be further amended or supplemented in
accordance with its terms, the "Acquisition
Agreement"), among the parties to the Loan Agreement,
APL has assigned its rights to receive delivery of the
Vessel described below from [HDW] [Daewoo] to [   ]
(the "Original Owner");

     WHEREAS, on the date hereof, the Original Owner
acquired the Vessel from [HDW] [Daewoo];

     WHEREAS, in accordance with that certain Exchange
Agreement dated as of the date hereof between APL and
the Original Owner, APL has acquired the Vessel
described below on the date hereof from the Original
Owner;

     WHEREAS, APL has [simultaneously herewith] entered
into a First Mortgage on the Vessel in favor of the
Assignee as security for the Owner Obligations referred
to [below in respect of the Vessel] [therein] [and has
also entered into a Second Mortgage on the Vessel in
favor of KfW as security for the Obligations referred
to [therein] [below]];

     WHEREAS, APL has transferred the Vessel to the
Assignor and the Assignor has assumed the above-
referenced First Mortgage pursuant to that certain
Assumption of First Preferred Ship Mortgage dated the
date hereof between APL and the Assignor [and has
assumed the above-referenced Second Mortgage pursuant
to that certain Assumption of Second Preferred Ship
Mortgage dated the date hereof between APL and the
Assignor];

     WHEREAS, the Assignor has accepted title to, and
is currently the registered owner of, the Republic of
The Marshall Islands flag vessel [     ], Official
Number [      ] (the "Vessel") [and the Assignor has
undertaken all of the payment and certain of the
performance obligations relating to Vessel Indebtedness
in respect of the Vessel under the Loan Agreement (the
"Owner Obligations")];

     WHEREAS, the Assignor has let and demised the
Vessel to APL as charterer (the "Charterer") and the
Charterer has hired the Vessel from the Assignor on the
terms and conditions set forth in the Bareboat Charter
Party dated the date hereof (the "Charter"), such
charter of the Vessel being effective upon the
execution and delivery of the Charter;

     [WHEREAS, pursuant to that certain Charter Hire
Guarantee executed by APC in favor of the Assignor (the
"Charter Hire Guarantee"), APC has guaranteed the
Charterer's obligations to pay Charter Hire and
Supplemental Charter Hire under the Charter;]

     [WHEREAS, as contemplated by the Acquisition
Agreement, the Assignor is entering into a Charter
Assignment relating to the Charter in favor of the
Syndicate Agent (the "Charter Assignment");]

     WHEREAS, as contemplated by the Acquisition
Agreement, the Assignor is entering into this [Second]
Charter Assignment relating to the Charter in favor of
the Assignee, and the Charterer is consenting to such
[Second] Charter Assignment pursuant to the Charter;

     WHEREAS, capitalized terms used herein but not
defined herein shall have the meanings assigned to them
in the Loan Agreement and the Acquisition Agreement.

     NOW, THEREFORE, in consideration of the premises
and the mutual covenants contained herein and other
good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, the parties
hereto agree as follows:

     1.   The Assignor hereby sells, pledges,
hypothecates, assigns, transfers and sets over unto the
Assignee and unto the Assignee's successors and
assigns, not absolutely but as security only for the
payment and performance [by the Assignor] of the [Owner
Obligations] [Obligations (as defined in the Second
Mortgage) and any other obligations secured by the
Second Mortgage (the "Owner Obligations")], and grants
to the Assignee a [first] [second] priority security
interest in all right, title and interest of the
Assignor in and to (i) the Charter [and the Charter
Hire Guarantee], all monies due and to become due and
claims for monies due and to become due, and all claims
for damages arising out of the breach of, the Charter
[and the Charter Hire Guarantee], together with any
extensions, renewal modifications, changes or
amendments of the Charter [and the Charter Hire
Guarantee], (ii) the rights, if any, of the Assignor as
a secured party in and to the Vessel under the Charter,
and (iii) any and all proceeds of the foregoing [;
provided, however, that until an Event of Default (as
that term is defined in the Loan Agreement and the
First Mortgage) shall have occurred and be continuing
and an Event of Default under the Charter (as defined
therein) has occurred and is continuing all payments of
Additional Charter Hire payable under the Charter may
be made directly to the Assignor].

     2.   The Assignor hereby agrees, represents and
warrants that:

     (a)  [Each of] the Charter [and the Charter Hire
Guarantee] is in full force and effect and enforceable
in accordance with its terms;

     (b)  The Assignor is not in default of any of the
terms of the Charter;

     (c)  Neither the whole nor any part of the right,
title and interest hereby assigned are the subject of
any present assignment or pledge other than the
assignment contained herein [and the Second Charter
Assignment in favor of Kreditanstalt fur Wiederaufbau],
and so long as this [Second] Charter Assignment shall
remain in effect, the Assignor will not, without the
prior written consent thereto of the Assignee, assign
or pledge the whole or any part of the right, title and
interest hereby assigned to anyone other than the
Assignee, its successors or assigns;

     (d)  The Assignor will not take or omit to take
any action, the taking or omission of which might
result in any alteration or impairment of the Charter[,
the Charter Hire Guarantee] or this [Second] Charter
Assignment or any of the rights created by the
Charter[, the Charter Hire Guarantee] or this [Second]
Charter Assignment;

     (e)  To the knowledge of the Assignor, the
Charterer is not in default of any of the terms of the
Charter;

     (f)  [Subject to the rights of the Syndicate Agent
under the Charter Assignment] [The] Assignor will not
enter into or consent to any amendment, modification or
other alteration of the Charter [or the Charter Hire
Guarantee] without first obtaining the prior written
consent of the Assignee.  Any amendment, modification
or other alteration made without the written consent of
the Assignee shall be null and void.

     (g)  In case there shall be pending proceedings
for the bankruptcy or for the reorganization of the
Charterer under any applicable law or in connection
with the insolvency of the Charterer, its property or
its creditors, the Assignee, irrespective of whether
Charter Hire (as defined in the Charter) shall then be
due and payable as provided in the Charter or by
declaration of acceleration or otherwise, shall be
entitled and empowered to intervene in such proceedings
or otherwise, to file and prove a claim or claims for
all amounts required to be paid by Charterer under the
Charter following such declaration owing and unpaid,
and to file such other papers or documents as may be
necessary or advisable in order to have the claims of
the Assignor allowed in any judicial proceeding
relative to the Charterer, its creditors, or its
property, and to collect and receive any money or other
property payable or deliverable on any such claims, and
to have the same applied pursuant to Section [5.09(a)]
[5.09(b)] of the Loan Agreement.  Nothing contained in
this [Second] Charter Assignment shall be deemed to
give the Assignee any right to accept or consent to any
plan of reorganization or otherwise by action of any
character in any such proceeding to waive or change in
any way any right of any Holder.

     (h)  Any monies collected by the Assignor pursuant
to enforcement of any of its rights under the Charter[,
the Charter Hire Guarantee] or under any other Charter
Document on account of the occurrence of an Event of
Default by or on behalf of the Assignor shall be
payable to the Assignee and distributed in accordance
with Section [5.09(a)] [5.09(b)] of the Loan Agreement.

     3.   Notwithstanding this Assignment, it is
acknowledged, understood and agreed that:

     (a)  The Assignor will remain liable to perform
all of the owner's obligations and duties under the
Charter.

     (b)  The Assignor will be deemed the owner under
the Charter except as expressly set forth herein.

     (c)  The Assignee shall have no obligation or
liability under or pursuant to the Charter by reason of
or arising out of this Assignment, nor to present or
file any claim, nor to take any other action to collect
or enforce the performance obligations of the Charterer
or payment of any amounts which have been assigned to
the Assignee or to which the Assignee may be entitled
under this [Second] Charter Assignment at any time or
times;

     (d)  So long as no Event of Default (as that term
is defined in the Loan Agreement and the First Mortgage
[and the Second Mortgage]) has occurred, is continuing
and shall not have been cured and waived and no Event
of Default under the Charter (as defined therein) has
occurred and is continuing, neither the Assignee, the
Assignor nor any successor thereof shall interfere with
the Charterer's possession and its peaceful and quiet
enjoyment of the Vessel.

     4.   The Assignor confirms to the Assignee its
authorization and direction to the Charterer in the
Charter to make payment of all monies due and to become
due under or arising out of the Charter at the time and
in the manner set forth in Section 2(b) of the Charter.

     5.   The Assignor does hereby constitute the
Assignee, its successors and assigns, the Assignor's
true and lawful attorneys, irrevocably, with full power
(in the name of the Assignor or otherwise), upon an
Event of Default under the Loan Agreement or the First
Mortgage [or the Second Mortgage], and in accordance
therewith, to ask, require, demand, receive, compound
and give acquittance for any and all monies, and claims
for monies and rights hereby assigned, to endorse any
checks or other instruments or orders in connection
therewith and to file any claims or take any action or
institute any proceedings which the Assignee may deem
to be necessary or advisable in the premises.

     6.   The Assignor hereby irrevocably authorizes
the Assignee, at the Assignor's expense, to file such
financing and continuation statements relating to this
[Second] Charter Assignment without the Assignor's
signature, as the Assignee at its option may deem
appropriate and appoints the Assignee as the Assignor's
attorney-in-fact to execute any such statements in the
Assignor's name and to perform all other acts which the
Assignee may deem appropriate to perfect and continue
the security interest conferred hereby.

     7.   The assignment of the Charter [and the
Charter Hire Guarantee] to the Assignee provided for
herein shall take effect immediately upon the execution
hereof and the powers and authorities granted to the
Assignee, its successors or assigns herein, having been
given for valuable consideration, are hereby declared
to be irrevocable.

     8.   The Assignor hereby agrees that at any time
and from time to time, upon the written request of the
Assignee, its successors and assigns, it will promptly
and duly execute and deliver any and all such further
instruments and documents as the Assignee, its
successors or assigns, may reasonably require in order
to obtain the full benefits of this [Second] Charter
Assignment and of the rights and powers herein granted.

     9.   This [Second] Charter Assignment shall be
governed by the laws of the State of New York (other
than the law of the State of New York governing choice
of law) and may not be amended or changed except by an
instrument in writing signed by the party against whom
enforcement is sought.

     10.  The Assignor hereby authorizes the Assignee
to execute and file financing statements and amendments
thereto as provided in Article 9 of the Uniform
Commercial Code.

     11.  Notwithstanding any other provision of this
[Second] Charter Assignment, this [Second] Charter
Assignment shall terminate, be void and of no further
effect upon the payment in full of the Owner
Obligations, together with payment of all other amounts
then due and owing secured by the First Mortgage [and
the Second Mortgage; provided, however, that, in any
event, this Second Charter Assignment shall terminate
upon termination of the Second Mortgage in accordance
with its terms].

     IN WITNESS WHEREOF, the Assignor has caused this
instrument to be duly executed as of the day and year
first above written.

     [              ]



    By:____________________
        Title:

                                                   EXHIBIT D
                                       TO SECOND AMENDED AND
                                       RESTATED AGREEMENT TO
                                         ACQUIRE AND CHARTER







                   CHARTER HIRE GUARANTEE
                     dated as of , 199_
                             by
             AMERICAN PRESIDENT COMPANIES, LTD.
                                  (as Guarantor)
                              
                              
                         in favor of
                              
               [_____________________________]
                                     (as Obligee)



      CHARTER HIRE GUARANTEE, dated as of [      ], l99_, by

AMERICAN  PRESIDENT COMPANIES, LTD., a Delaware  corporation

(the  "Guarantor"), in favor  of  [                  ]  (the

"Obligee"). Capitalized terms used herein and not  otherwise

defined  herein  shall have the meanings set  forth  in  the

Second Amended and Restated Agreement to Acquire and Charter

dated  September  1, 1995 (the "Acquisition Agreement"),  by

and  among  Kreditanstalt  fur Wiederaufbau,  a  corporation

organized  and  existing  under  the  laws  of  the  Federal

Republic of Germany whose address is Palmengartenstrasse  5-

9,  Postfach  11-11-41, D-60325 Frankfurt am  Main  ("KfW"),

COMMERZBANK AG (HAMBURG), a banking corporation incorporated

in  the Federal Republic of Germany whose address is Ness 7-

9,  D-20457 Hamburg, (the "Syndicate Agent") and  the  banks

listed  in  Schedule 1 which is attached  hereto  (KfW,  the

Syndicate Agent, and the banks listed in such Schedule 1 are

hereinafter  referred to collectively as the  "Banks"),  the

corporations    listed   as   Transferees    therein    (the

"Transferees")  and  American  President  Lines,   Ltd.,   a

Delaware corporation (the "Charterer").





W I T N E S S E T H:



      WHEREAS, in accordance with the Acquisition Agreement,

APL  has  assigned  its rights to receive  delivery  of  the

Vessel  described  below from [HDW] [Daewoo]  to  [  ]  (the

"Original Owner");

      WHEREAS,  the Obligee has accepted title  to,  and  is

currently  the  registered owner of,  The  Republic  of  The

Marshall

Islands  flag  vessel [________], Official Number  [_______]

(the  "Vessel"), and the Obligee has undertaken all  of  the

payment  and certain of the performance obligations relating

to  Vessel  Indebtedness in respect of the Vessel under  the

Loan Agreement, (the "Owner Obligations");

      WHEREAS,  in  accordance with  that  certain  Exchange

Agreement  dated as of the date hereof between  the  Obligee

and  the  Original  Owner  (the "Exchange  Agreement"),  the

Obligee has acquired the Vessel described below on the  date

hereof from the Original Owner;

       WHEREAS,  the  Obligee  has  simultaneously  herewith

entered  into  a First Mortgage on the Vessel  in  favor  of

[KfW] [the Syndicate] (the "Vessel Lender"), as security for

the Owner Obligations in respect of the Vessel;

      [WHEREAS,  the  Obligee  has  simultaneously  herewith

entered  into a Second Mortgage on the Vessel  in  favor  of

KfW, as security for the Obligations of the Obligee referred

to therein;]

      WHEREAS, the Obligee has let and demised the Vessel to

the  Charterer and the Charterer has hired the  Vessel  from

the  Obligee  on the terms and conditions set forth  in  the

Bareboat   Charter  Party,  dated  the  date   hereof   (the

"Charter"), such charter of the Vessel being effective  upon

the execution and delivery of the Charter;

      WHEREAS, the Guarantor is entering into this Guarantee

in  consideration of the Banks entering into the Acquisition

Agreement and purchasing the Notes.

      Accordingly,  the  Guarantor hereby  agrees  with  the

Obligees as follows:

     SECTION 1. GUARANTEE

      1.1 The Guarantee. The Guarantor hereby guarantees  as

primary  obligor and not as a surety the full  and  punctual

payment  of all amounts payable by the Charterer  under  the

Charter.   Upon  failure by the Charterer to pay  punctually

any  such  payment  required by it to  be  paid  within  any

applicable  grace periods permitted under the  Charter,  the

Guarantor  shall forthwith on demand pay the amount  not  so

paid  in  immediately available funds as specified  therein.

Upon  payment  by  the Guarantor of any  obligation  of  the

Charterer pursuant to this Section 1.1, such obligation with

respect to such payment under the Charter shall terminate.

      1.2  Guarantee Unconditional. The obligations  of  the

Guarantor hereunder shall be irrevocable, unconditional  and

absolute without regard to:

           (a)  any amendment, consent or release in respect

     of   any  of  the  terms  of  the  Charter  or  of  the

     obligations  under any thereof of any Person  (provided

     only  that  such  amendment,  consent  or  release   is

     effected  in accordance with the terms of the Charter);

     or

            (b)  any  taking,  holding,  exchange,  release,

     non-perfection or invalidity of any direct or  indirect

     security for any obligation of the Charterer under  the

     Charter; or

            c)   any  change  in  the  corporate  existence,

     structure  or  ownership  of  the  Charterer,  or   any

     insolvency, bankruptcy, reorganization or other similar

     proceeding affecting the Charterer or its assets; or

           (d)  the existence of any claim, setoff or  other

     rights which the Guarantor may have at any time against

     the Charterer; or

            (e)  any  defense  arising  by  reason  of   any

     invalidity,  unenforceability or other defense  of  the

     Charterer,  or  other defense of the  Guarantor  or  by

     reason  of  the cessation from any cause whatsoever  of

     the  liability  either  in whole  or  in  part  of  the

     Charterer  to  pay any amount payable by it  under  the

     Charter; or

           (f)  any  consent, release, renewal, refinancing,

     refunding, amendment or modification of or addition  or

     supplement  to  or waiver of any of the  terms  of  the

     Charter  or  of any other agreement which may  be  made

     relating to the Charter or of the obligations under any

     thereof of any Person (provided only that such consent,

     release, renewal, refinancing, refunding, amendment  or

     modification of or addition or supplement to or  waiver

     is  effected  in  accordance  with  the  terms  of  the

     Charter); or

           (g)  any  exercise or non-exercise of any  right,

     power, privilege or remedy under or in respect of  this

     Guarantee  or the Charter, or any waiver  of  any  such

     right, power, privilege or remedy or of any default  in

     respect  of  the  Charter,  or  any  receipt   of   any

     collateral  security or any sale, exchange,  surrender,

     release,  discharge, failure to perfect or to  continue

     perfected, loss, abandonment or alteration of, or other

     dealing with, any collateral security by whomsoever  at

     any  time  pledged or mortgaged to secure,  or  however

     securing,  any  of the Guarantor's obligations  or  any

     liabilities  (including liabilities  of  the  Guarantor

     hereunder)  incurred directly or indirectly in  respect

     thereof.

            1.3   Discharge  Only  Upon  Payment  in   Full;

Reinstatement  in  Certain Circumstances.   The  Guarantor's

obligations hereunder shall remain in full force and  effect

until the amounts payable by the Charterer under the Charter

shall  have  been  paid in full or the  obligations  of  the

Charterer thereunder have otherwise terminated, whichever is

earlier.  If at any time any amount payable by the Charterer

under the Charter is rescinded or must be otherwise restored

or    returned   upon   the   insolvency,   bankruptcy    or

reorganization   of   the  Charterer   or   otherwise,   the

Guarantor's  obligations  hereunder  with  respect  to  such

payment  shall  be reinstated at such time  as  though  such

payment had not been made.

           1.4  Waiver.  The  Guarantor  irrevocably  waives

acceptance of this Guarantee, presentment, demand except  as

required  pursuant  to  Section  1.1  hereof,  protest,  and

notice,  as  well as any requirement that at  any  time  any

action  be taken by any Person against the Charterer or  any

other Person.

            1.5   Subrogation.  Upon  making   any   payment

hereunder, the  Guarantor  shall be subrogated to the rights 

of the  Obligee under the  Charter  against  the Charterer 

with  respect  to  such payment; provided   that  the  

Guarantor  shall  have  no  right   of subrogation and

waives,  to the fullest extent permitted by applicable  law,

any right to any security in the Vessel which is the subject

of  the Charter and to exercise any remedy which the Obligee

has  or may hereafter have against the Charterer for payment

of  money  until all amounts payable by the Charterer  under

the Charter have been paid in full or the obligations of the

Charterer thereunder have otherwise terminated, whichever is

earlier.  Nothing contained in this Guarantee shall preclude

the  Guarantor  from causing the Charterer to make  payments

required by the Charterer under the Charter.

           1.6  Payment Guarantee: No Set-Off or Deductions:

No  Waiver.  The  Guarantor  hereby  agrees  that  (a)  this

Guarantee  is a guarantee of payment and not of  collection,

and  shall continue in full force and effect and be  binding

upon  the  Guarantor, its successors and  assigns;  and  (b)

amounts  payable  hereunder shall be paid when  due  without

set-off  or  reduction for any reason whatsoever;  provided,

however,  that  nothing contained in this Section  shall  be

construed  to  be  a  waiver,  modification,  alteration  or

release  of  any  claims which the Guarantor  may  have  for

damages or equitable relief for any breach by the Obligee of

any provision of the Charter or for any loss due to any acts

taken by the Obligee thereunder.

      1.7  Obligations Unaffected. The Obligee may,  at  any

time  and  from  time to time, without the  consent  of,  or

notice  to,  the Guarantor, without incurring responsibility

to  the  Guarantor  and without impairing,  diminishing,  or

discharging,    releasing,   suspending,   prejudicing    or

terminating  the obligations of the Guarantor hereunder,  in

accordance with the terms and conditions of the Charter  and

in  whole  or  in part, take or refrain from taking  (either

directly or indirectly) any and all actions with respect  to

the  Guarantor's obligations, this Guarantee,  the  Charter,

any  collateral security at any time granted or received for

any of the Guarantor's obligations, or any Person (including

any  Guarantor)  that  the Obligee determines  in  its  sole

discretion  to be necessary or appropriate, whether  or  not

such  action  or refraining from action varies or  increases

the  risk  of,  the Guarantor; provided, however,  that  any

amount  received  by  the Obligee as a result  of  any  such

action   shall   correspondingly  reduce   the   Guarantor's

obligations hereunder.

     No right of the Obligee hereunder, and no obligation of

the  Guarantor  hereunder, shall be in any  way  limited  or

otherwise  impaired  by the failure of the  Obligee  (i)  to

commence  any  action  or obtain any  judgment  against  the

Charterer;  (ii) to seek recourse against, or to perfect  or

enforce  any  rights  in and to, any  collateral;  (iii)  to

proceed against any other guarantee relating to all  or  any

of  the obligations guaranteed hereunder or (iv) to exercise

any  other  right, remedy, power or privilege  hereunder  or

otherwise. The Guarantor waives and agrees not to assert (a)

any  right  to  require  the  Obligee  to  take  any  action

described   in  clauses  (i)  to  (iv)  of  the  immediately

preceding  sentence  and  (b)  any  defense  based  upon  an

election   of   remedies  which  destroys  or  impairs   the

subrogation  rights  of the Obligee  or  the  right  of  the

Obligee  to proceed against the Guarantor hereunder  or  the

Charterer   in   respect   of  the  obligations   guaranteed

hereunder.

           SECTION 2. Representations and Warranties of  the

Guarantor.  The  Guarantor represents and  warrants  to  the

Obligee that:

           2.1 the Guarantor is a corporation duly organized

and  validly existing in good standing under the laws of the

jurisdiction of its incorporation with full corporate  power

and  authority  to  conduct its  business  as  the  same  is

presently conducted;

          2.2 the Guarantor has legal power and authority to

enter into and carry out the terms of this Guarantee;

          2.3 this Guarantee has been duly authorized by all

necessary  action, corporate or other, on the  part  of  the

Guarantor, and this Guarantee constitutes in accordance with

its terms, a legal, valid and binding instrument enforceable

against  the  Guarantor, except to  the  extent  limited  by

applicable     bankruptcy,    reorganization,    insolvency,

moratorium or other laws of general application relating  to

or  affecting the enforcement of creditors' rights from time

to time in effect;

            2.4  except  as  previously  disclosed  to   the

Syndicate  Agent  and  the Agent in writing,  there  are  no

actions, suits or proceedings pending or, to the Guarantor's

knowledge, threatened against the Guarantor, which  question

the  validity  of this Guarantee or action taken  or  to  be

taken  by  the  Guarantor pursuant to this  Guarantee  which

would,  if  adversely determined, materially  and  adversely

affect  the  performance by the Guarantor of its obligations

hereunder;

           2.5  the execution and delivery of this Guarantee

by the Guarantor and the performance by the Guarantor of its

obligations  under  this  Guarantee  will  not  violate  any

provisions of the Certificate of Incorporation or Bylaws  of

the  Guarantor and will not result in a breach of the  terms

and  provisions of, or constitute a default under, any other

agreement or undertaking by the Guarantor or by which it  or

any  of  its property is bound or any order of any court  or

administrative agency entered in any proceedings binding  on

the  Guarantor, or violate any applicable statute,  rule  or

regulation;

           2.6  the  Guarantor  is not  in  default  and  no

Incipient  Default has occurred, in any respect which  would

materially and adversely affect the ability of the Guarantor

to  perform its obligations under this Guarantee, under  any

mortgage, loan agreement, deed of trust, indenture or  other

agreement  with respect thereto or evidence of  indebtedness

to  which it is a party or by which it is bound, and is  not

in  violation of or in default, in any respect  which  would

materially and adversely affect the ability of the Guarantor

to  perform its obligations under this Guarantee, under  any

order, writ, judgment or decree of any court, arbitrator  or

governmental   authority,  commission,  board,   agency   or

instrumentality, domestic or foreign;

           2.7  the  Guarantor has more than  one  place  of

business  and the present location of the place of  business

which  is  its  chief  executive office  is  1111  Broadway,

Oakland, California 94607;

           2.8  the Guarantor has no knowledge of any actual

or   proposed   deficiency  or  additional   assessment   in

connection with any Taxes which either in any case or in the

aggregate  would be materially adverse to the Guarantor  and

which  would materially and adversely affect the ability  of

the Guarantor to perform its obligations hereunder;

           2.9  all  Taxes  (other than taxes  based  on  or

measured by income and withholding taxes), liability for the

payment  of  which  has been incurred by  the  Guarantor  in

connection  with the execution, delivery and performance  by

it  of each Loan Document to which it is or will be a party,

have  been  paid  (or provided for in its  accounts  if  not

payable  on  or prior to the delivery date of the respective

Vessel);

            2.10   all   governmental  consents,   licenses,

permissions,  approvals, registrations or authorizations  or

declarations  required (i) to enable it  lawfully  to  enter

into   and  perform  its  payment  obligations  under   this

Guarantee and to require the Charterer to perform its  other

obligations  under  the Charter, (ii)  to  ensure  that  its

respective obligations under clause (i) hereunder are legal,

valid  and  enforceable  and (iii) to  make  this  Guarantee

admissible in evidence have been obtained or made and are in

full force and effect;

      2.11 it has not taken any corporate action nor to  its

knowledge  have  any  other  steps  been  taken   or   legal

proceedings been started or threatened against  it  for  its

winding-up,  dissolution  or  reorganization  or   for   the

appointment   of   a   receiver,  administrative   receiver,

administrator, trustee or similar officer of it or of any or

all of its respective assets and revenues;

           2.12  (i) no written representation, warranty  or

statement  made or other document provided by the  Guarantor

in  connection with the negotiation of this Guarantee at the

time  when  given is or was untrue or contains or  contained

any misrepresentation of a material fact or omits or omitted

to  state  any  material fact necessary  to  make  any  such

statement  herein  or therein not misleading  and  (ii)  all

financial projections, if any, prepared by the Guarantor and

made  available  to the Obligee have been prepared  in  good

faith based upon reasonable assumptions (it being understood

that   such   projections   are   subject   to   significant

uncertainties  and contingencies, many of which  are  beyond

the Guarantor's control, and that no assurances can be given

that any such projections will be realized);

          2.13 ERISA. To the best knowledge of the Guarantor

(i)  each  Plan maintained by the Guarantor and  each  ERISA

Affiliate  is  in  substantial compliance  in  all  material

respects  with  ERISA;  (ii)  no  Plan  maintained  by   the

Guarantor  or  any  ERISA  Affiliate  is  insolvent  or   in

reorganization; (iii) no Insufficiency or Termination  Event

has occurred or is reasonably expected to occur,

and  no  "accumulated  funding  deficiency"  exists  and  no

"variance"  from  the "minimum funding  standard"  has  been

granted (each such term as defined in Part III, Subtitle  B,

of  Title I of ERISA) with respect to any Plan in which  the

Guarantor or any of its Subsidiaries, or any ERISA Affiliate

is  a  participant; (iv) neither the Guarantor nor any ERISA

Affiliate has incurred, or is reasonably expected to  incur,

any  Withdrawal  Liability to any  Multiemployer  Plan;  (v)

neither  the  Guarantor,  its Subsidiaries,  nor  any  ERISA

affiliate   has   received   any   notification   that   any

Multiemployer  Plan  in  which it is  a  participant  is  in

reorganization or has been terminated, within the meaning of

Title  IV  of  ERISA  and  no  such  Multiemployer  Plan  is

reasonably  expected to be in reorganization  or  terminated

within  the  meaning  of Title IV of  ERISA;  (vi)  no  lien

imposed  under  the  Code or ERISA  on  the  assets  of  the

Guarantor or any Subsidiary or any ERISA Affiliate exists or

is  reasonably  expected to arise on account  of  any  Plan;

(vii)  no  material  liability  will  be  incurred  by   the

Guarantor, its Subsidiaries, or any ERISA Affiliate  if  any

of them should terminate contributions to any other employee

benefit plan maintained by them;

           2.14  it  is  not an "investment  company"  or  a

company "controlled" by an "investment company" (as each  of

such terms is defined or used in the Investment Company  Act

of 1940, as amended).

            SECTION  3.  Covenants  of  the  Guarantor.  The

Guarantor covenants to the Obligee that:

            3.1  The  Guarantor  will  not  consolidate   or

amalgamate with, or merge into, any other entity,  or  sell,

convey,  transfer,  lease, or otherwise dispose  of  all  or

substantially all of its assets, including, but not  limited

to,  by dividend (whether by one transaction or a series  of

transactions and whether related or not); provided, however,

that  it may consolidate or amalgamate with, or merge  into,

any  other  entity,  or sell, convey,  transfer,  lease,  or

otherwise dispose of all or substantially all of its  assets

if  the  buyer,  assignee  or  transferee  corporation  (the

"Assignee")  shall  be a solvent corporation  organized  and

existing  under the laws of the United States of America  or

any  state thereof following such transaction and shall have

executed  and delivered an agreement, in form and  substance

reasonably  satisfactory  to  the  Obligees,  containing  an

assumption   by  the  Assignee  of  the  due  and   punctual

performance  and observance of all covenants and obligations

of  the Guarantor hereunder, and confirming the accuracy  of

any  representations and warranties made herein  as  of  the

date  hereof  required with respect to  such  Assignee;  and

provided    further   that   immediately   following    such

transaction, no Incipient Default or Event of Default  shall

have occurred and be continuing.

          SECTION 4. Financial Statements.

           4.1  The  Guarantor shall, as soon  as  possible,

provide to the Agent and the Syndicate Agent (a) but  in  no

event later than one hundred twenty (120) days after the end

of  each  fiscal year, its consolidated audited accounts  of

all consolidated financial statements of the Guarantor, such

financial  statements  to  be prepared  in  accordance  with

generally  accepted  United  States  of  America  accounting

principles  at such time consistently applied and  a  report

thereon by Arthur Andersen & Co. or other independent public

auditors  of internationally recognized standing as  may  be

acceptable to the Agent and the Syndicate Agent, (b)  copies

of  all  quarterly  reports filed with  the  Securities  and

Exchange Commission and, within seventy-five (75) days after

the  end of the first three (3) quarters of its fiscal year,

unaudited  consolidated statements of income and changes  in

financial  position  of the Guarantor  and  related  balance

sheets  for  each  such period, all certified  as  true  and

correct by a financial officer of the Guarantor, (c) as soon

as  the  same  is  instituted (or, to the knowledge  of  the

Guarantor    threatened),   details   of   any   litigation,

arbitration   or  administrative  proceedings   against   or

involving  the Guarantor, the Charterer or the Vessel  which

if adversely determined would have a material adverse effect

on  the Guarantor, any Charterer and any of its subsidiaries

on  a consolidated basis, or construction of the Vessel, and

(d)  from  time  to  time,  and on demand,  such  additional

financial or other information relating to the Guarantor  as

may  be  reasonably requested by the Agent or the  Syndicate

Agent.

     SECTION 5. Miscellaneous

           5.1  No  failure on the part of  any  Obligee  to

exercise,  no delay in exercising, and no course of  dealing

with  respect to, any right or remedy hereunder will operate

as a waiver thereof; nor will any single or partial exercise

of  any right or remedy hereunder preclude any other further

exercise  of  any other right or remedy. This Guarantee  may

not  be  amended or modified except by written agreement  of

the Guarantor and the Obligee.

           5.2  All notices or other communications required

under  the terms and provisions hereof shall be made in  the

manner  provided  in  Section 15.04 of  the  Loan  Agreement

addressed  as follows: to (i) Kreditanstalt fYr Wiederaufbau

at:  Palmengartenstrasse 5-9, D-60325 Frankfurt am Main  (if

by  hand), Postfach 11-11-41, D-60046 Frankfurt am Main  (if

by  mail),  Federal Republic of Germany, Telefax No.:  7431-

2944  or 7431-2198; (ii) to Commerzbank AG at: Ness 7-9,  D-

20457  Hamburg,  Federal  Republic  of  Germany,  Attention:

Stefan  E. Kuch, Telefax No.: 49-40-3683-4068; (iii) to  the

Guarantor  at:  1111  Broadway, Oakland,  California  94607;

Attention: Treasurer, Telefax No.: (510) 272-8931; and  (iv)

to the Obligee at: 111 Broadway, Oakland, California 94607.

           5.3  The terms of this Guarantee shall be binding

upon,  and  inure to the benefit of, the Guarantor  and  the

Obligee and their respective successors and assigns.

           5.4  No recourse shall be had for the payment  of

any  amount  payable  hereunder  against  any  incorporator,

stockholder, officer or director, as such, past, present  or

future,  of  the Guarantor or of any successor  corporation,

either  directly or through the Guarantor or  any  successor

corporation,   whether  by  virtue  of  any   constitutional

provision, statute or rule of law, or by the enforcement  of

any  assessment or penalty or otherwise; it being  expressly

agreed  and  understood  that this  Guarantee  is  solely  a

corporate   obligation,  and  that  no  personal   liability

whatsoever  shall  attach  to,  or  be  incurred   by,   any

incorporator,  stockholder, officer or  director,  as  such,

past,  present  or  future,  of  the  Guarantor  or  of  any

successor  corporation,  because of  the  incurring  of  the

indebtedness hereby authorized or under or by reason of  any

of   the  obligations,  covenants,  promises  or  agreements

contained  in this Guarantee or to be implied herefrom,  and

that  all liability, if any, of that character against every

such incorporator, stockholder, officer and director is,  by

the  acceptance of this Guarantee and as a condition of, and

as  part  of  the consideration for, the execution  of  this

Guarantee, expressly waived and released.

            5.5   This  Guarantee  shall  be  construed   in

accordance with and governed by the laws of the State of New

York  (other than the law of the State of New York governing

choice of law).

           5.6  The Guarantor (a) hereby irrevocably submits

itself to the jurisdiction of the Supreme Court of the State

of  New York, New York County and to the jurisdiction of the

United  States District Court for the Southern  District  of

New  York  for  the purposes of any suit,  action  or  other

proceeding arising out of this Guarantee or the Charter,  or

the   subject  matter  hereof  or  thereof  or  any  of  the

transactions contemplated hereby or thereby, brought by  the

Obligee or its successors, subrogees or assigns, (b)  hereby

irrevocably  agrees  that, all claims  in  respect  of  such

action  or proceeding may be heard and determined,  in  such

New  York State or Federal court, and (c) to the extent that

it   has   or  hereafter  may  acquire  any  immunity   from

jurisdiction of any court or from any legal process,  hereby

waives  such immunity, and agrees not to assert, by  way  of

motion, as a defense, or otherwise, in any such suit, action

or  proceeding,  (i)  any claim that it  is  not  personally

subject  to  the  jurisdiction of the above-named  New  York

State  or  Federal  courts, (ii) that the  suit,  action  or

proceeding  is  brought in an inconvenient forum,  that  the

venue  of  the  suit, action or proceeding is  improper,  or

(iii)  that this Guarantee or the subject matter hereof  may

not be enforced in or by such courts or under any applicable

law. The Guarantor hereby consents to service of process  in

any  suit,  action or other proceeding arising out  of  this

Guarantee  or  the  subject matter  hereof  or  any  of  the

transactions  contemplated hereby and  hereby  appoints  the

Person  set  forth  in Schedule 7 of the Loan  Agreement  as

Process Agent for the Borrower (the "Process Agent") as  its

attorneys-in-fact  to receive service  of  process  in  such

action,  suit  or proceeding, it being agreed  that  service

upon  the Process Agent shall constitute valid service  upon

the  Guarantor and its successors and assigns. The Guarantor

agrees  that  (x) the sole responsibilities of  the  Process

Agent  shall be (i) to receive such process, (ii) to send  a

copy  of  any such process so received to the Guarantor,  by

registered airmail, return receipt requested, at its address

set  forth  in  Section 5.2 hereof, or at the  last  address

filed  in writing by it with the Process Agent and (iii)  to

give  prompt  telegraphic notice of receipt thereof  to  the

Guarantor  at such address and (y) the Process  Agent  shall

have no responsibility for the receipt or nonreceipt by  the

Guarantor  of  such  process, nor  for  any  performance  or

nonperformance  by  it  or  its  respective  successors   or

assigns.  The Guarantor hereby agrees to pay to the  Process

Agent such compensation as shall be agreed upon from time to

time  by  it  and the Process Agent for the Process  Agent's

services  hereunder. The Guarantor hereby  agrees  that  its

submission  to  jurisdiction  and  its  designation  of  the

Process  Agent  set  forth above is  made  for  the  express

benefit  of  the Obligee and its successors,  subrogees  and

assigns.  The  Guarantor agrees that it will  at  all  times

continuously maintain a Process Agent to receive service  of

process in the City of New York or San Francisco, California

on  behalf of itself and its properties with respect to this

Agreement,  and  in  the event that,  for  any  reason,  the

Process  Agent named pursuant to this Section 5.6  shall  no

longer  serve as Process Agent to receive service of process

on  the  Guarantor's  behalf, the Guarantor  shall  promptly

appoint  a  successor Process Agent. The  Guarantor  further

agrees  that a final judgment against the Guarantor  in  any

such  action or proceeding shall be conclusive, and  may  be

enforced  in other jurisdictions by suit on the judgment  or

in  any  other manner provided by law, a certified  or  true

copy of which final judgment shall be conclusive evidence of

the  fact and of the amount of any indebtedness or liability

of the Guarantor therein described; provided that nothing in

this Section 5.6 shall affect the right of the Guarantor  or

the  Obligee  or their respective successors,  subrogees  or

assigns to serve legal process in any other manner permitted

by  law  or affect the right of the Guarantor or the Obligee

or  their  respective successors, subrogees  or  assigns  to

bring any action or proceeding against the Guarantor or  the

Obligee,  as the case may be, or its property in the  courts

of  other jurisdictions. In the event of the transfer of all

or  substantially all the assets and business of the Process

Agent  to  any other corporation, by consolidation,  merger,

sale of assets or otherwise, such other corporation shall be

substituted  hereunder for the Process Agent with  the  same

effect as if named herein in place of the Process Agent. THE

GUARANTOR  HEREBY  WAIVES  TRIAL BY  JURY  IN  ANY  JUDICIAL

PROCEEDING  TO  WHICH IT IS A PARTY INVOLVING,  DIRECTLY  OR

INDIRECTLY,  ANY MATTER (WHETHER SOUNDING IN TORT,  CONTRACT

OR  OTHERWISE)  IN ANY WAY ARISING OUT OF,  RELATED  TO,  OR

CONNECTED   WITH  THIS  GUARANTEE,  THE  CHARTER,   OR   THE

RELATIONSHIP  ESTABLISHED HEREUNDER AND WHETHER  ARISING  OR

ASSERTED BEFORE OR AFTER THE DATE HEREOF OR BEFORE OR  AFTER

THE  PAYMENT,  OBSERVANCE AND PERFORMANCE  IN  FULL  OF  THE

GUARANTOR'S OBLIGATIONS UNDER THIS GUARANTEE.

           5.7  Currency of Account. (a) The Dollar  is  the

currency  of  account or each and every  sum  due  from  the

Guarantor to the Obligee under this Guarantee in respect  of

any of the obligations guaranteed hereunder.

           (b)  If  after  the occurrence of  any  Event  of

Default,  any  sum  is  due from the  Guarantor  under  this

Guarantee  or  if  any order or judgment given  or  made  in

relation  hereto 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:

           (i) making or filing a claim or proof against the

     Guarantor;

           (ii)  obtaining an order or judgment in any court

     or tribunal; or

           (iii)  enforcing any order or judgment  given  or

     made in relation hereto.

     (c) The Guarantor shall indemnify and hold harmless the

Obligee from and against any damages or losses suffered as a

result  of any discrepancy between (A) the rate of  exchange

used  for  such purpose to convert the sum in question  from

the first currency into the second currency and (B) the rate

or  rates  of  exchange  at which the  Obligee  may  in  the

ordinary course of business purchase the first currency with

the second currency in the Frankfurt foreign exchange market

upon  receipt of a sum paid to it in satisfaction, in  whole

or in part, of any such order, judgment, claim or proof. The

above  indemnity shall constitute a separate and independent

obligation  of the Guarantor from its other obligations  and

shall  apply irrespective of any indulgence granted  by  the

Obligee.

           5.8  If any term of this Guarantee and any  other

application  thereof shall be invalid or unenforceable,  the

remainder  of  this Guarantee and any other  application  of

such terms shall not be affected thereby.

          5.9 This Guarantee shall be binding upon, inure to

the benefit of, and be enforceable by, the Guarantor and the

Obligee and their respective successors and assigns.

            5.10  The  Guarantor  hereby  acknowledges   and

consents to the assignment of this Guarantee pursuant to the

terms of the

Charter Assignment dated the date hereof between the Obligee

and [KfW] [the Syndicate].

     IN WITNESS WHEREOF, the Guarantor has caused this

Guarantee to be duly executed as of the date first set forth

herein.



                         AMERICAN PRESIDENT COMPANIES, LTD.




By:_________________________________
                              Title:

SCHEDULE 1
page 1 of 2

NAMES AND ADDRESSES OF SYNDICATE MEMBERS


Commerzbank AG (Kiel Branch)
Holstenstrasse 64
D-24103 Kiel
Federal Republic of Germany
Attention: Mr. Claes
Telex: 292898 CBKD
Telecopy: 49-431-9974-372

Dresdner Bank AG in Hamburg
Jungfernstieg 22
D-20354 Hamburg
Federal Republic of Germany
Attention:     Mr. Eggert
               Mr. Bottcher
Telex: 2157170 DR D
Telecopy: 49-40-3501-3818

Vereins- und Westbank AG
Alter Wall 22
D-20457 Hamburg
Federal Republic of Germany
Attention:     Mr. Kopcke
               Mrs. Mertens
Telex: 215164 VH D
Telecopy: 49-40-3692-3696

Deutsche Schiffsbank AG
Domshof 17
D-28195 Bremen
Federal Republic of Germany
Attention:     Mr. Pieper
               Mr. Onnen
Telex: 244870 DSBR D
Telecopy: 49-421-323539

Norddeutsche Landesbank -Girozentrale
Georgsplatz 1
D-30159 Hannover
Federal Republic of Germany
Attention:     Mr. Hartmann
Telex: 921634 GZH D
Telecopy: 49 511 36 14785


Schedule 1
Page 2 of 2

Deutsche verkehrs-Bank AG
(Hamburg Branch)
Filiale Hamburg
Ballindamm 6
D-20095 Hamburg
Federal Republic of Germany
Attention:     Mr. Spincke
Telex: 402077 DVB
Telecopy: 49-40-308004-12

Banque Internationale a
Luxembourg S.A.
2 Boulevard Royal
L-2953 Luxembourg
Attention: Mr. Jean Pierre Vernier
Telex: 3326 BIL LU
Telecopy: 35-2-4590-2010