**Exhibit 10.8**

 

**Codeword for this Charter Party**

**“SHELLTIME4”**

 

Issued December 1984amended December 2003

 

**TimeCharter Party**

**NewYork**

**April 1,2008**

 

IT ISTHIS DAY AGREED between : (A) OSG 300 LLC in its capacity as the owner ofthe barge M-300 (the “Barge”) and OSG Liberty LLC in its capacity as the Ownerof the tug Liberty (the “Tug”) of Delaware (hereinafter referred to as “Owners”),as the Barge and Tug each a “vessel” and together “the vessels”) described asper Clause 1 hereof; and (B) OSP 300 LLC of Delaware (hereinafterreferred to as “Charterers”):

 

**Descriptionand Condition of Vessel**

 

1.                         At thedate of delivery of the vessel under this charter and throughout the charterperiod:

 

(a)                    each shall beclassed by a Classification Society which is a member of the InternationalAssociation of Classification Societies; classification will be ABS

 

(b)                   the Barge shallbe in every way fit to carry crude oil and/or its products;

 

(c)                    each shall betight, staunch, strong, in good order and condition, and in every way fit forthe service, with her machinery, boilers, hull and other equipment (includingbut not limited to hull stress calculator, radar, computers and computersystems) in a good and efficient state;

 

(d)                   her tanks,valves and pipelines shall be oil-tight;

 

(e)                    the Tug shallbe in every way fitted for burning, in accordance with the grades specified inClause 29 hereof; IFO 380 CST RMG 380 ISO 8217:2005 (E) and ISO DMA8217:2005 — Charterers will endeavor to procure IFO with maximum 3.0% sulphur,provided it is readily available within the port the Tug would normally bunkerand without incremental time or cost to Charterers, as compared to IFO thatwould otherwise be supplied with maximum 4.5% sulphur content, or as requiredby law.  Charterers have no obligationwhatsoever to deviate the Vessels for the purpose of procuring IFO 3.0% maximumsulphur unless required to comply with applicable law(s).

 

(i)                       at sea,fuel oil for main propulsion and fuel oil/marine diesel oil* for auxiliaries;

 

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(ii)                    in port, fueloil/marine diesel oil* for auxiliaries;

 

(f)                      Each shallcomply with the regulations in force so as to enable her to pass through theSuez and Panama Canals by day and night without delay;

 

(g)                   Each shall haveon board all certificates, documents and equipment required from time to timeby any applicable law to enable her to perform the charter service withoutdelay;

 

(h)                   Each shallcomply with the description in the OCIMF Harmonised Vessel ParticularsQuestionnaire, appended hereto as Appendix A, provided however that if there isany conflict between the provisions of this questionnaire and any otherprovision, including this Clause 1, of this charter such other provisions shallgovern;

 

(i)                       theownership structure, flag, registry, and classification society and managementcompany of each vessel shall not be changed, without approval of Charterers,which shall not be unreasonably withheld;

 

**SafetyManagement**

 

(j)                       Owners willoperate:

 

(i)                       a safetymanagement system certified to comply with the International Safety ManagementCode (“ISM Code”) for the Safe Operation of Ships and for Pollution Prevention;

 

(ii)                    a documentedsafe working procedures system (including procedures for the identification andmitigation of risks);

 

(iii)                 a documentedenvironmental management system;

 

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(iv)                documentedaccident/incident reporting system compliant with flag state requirements;

 

(k)                    Owners shallsubmit to Charterers a monthly written report detailing all accidents/incidentsand environmental reporting requirements;

 

(l)                       Ownersshall maintain Health Safety Environmental (“HSE”) records sufficient todemonstrate compliance with the requirements of their HSE system and of thischarter.  Charterers reserve the right toconfirm compliance with HSE requirements by audit of Owners.

 

(m)                 Owners willarrange at their expense for a SIRE inspection to be carried out at intervalsof six months plus or minus thirty days.

 

**ShipboardPersonnel and their Duties**

 

2.                         (a)     Atthe date of delivery of the vessels under this charter and throughout thecharter period:

 

(i)                       Each shallhave a full and efficient complement of master, officers and crew for a vesselof her tonnage, who shall in any event be not less than the number required bythe laws of the flag state and who shall be trained to operate the vessel andher equipment competently and safely;

 

(ii)                    all shipboardpersonnel shall hold valid certificates of competence in accordance with therequirements of the law of the flag state;

 

(iii)                 all shipboardpersonnel shall be trained in accordance with the relevant provisions of theInternational Convention on Standards of Training, Certification andWatchkeeping for Seafarers, 1995 or any additions, modifications or subsequentversions thereof;

 

(iv)                there shall be onboard sufficient personnel with a good working knowledge of the Englishlanguage to enable cargo operations at loading and discharging places to becarried out efficiently and safely and to enable communications between the vesselsand those loading the Barge or accepting discharge there from to be carried outquickly and efficiently;

 

(v)                   the terms ofemployment of the vessels’ staff and crew will always remain acceptable to TheInternational Transport Worker’s Federation and the vessels will at all timescarry a Blue Card;

 

(vi)                the nationality ofthe vessels’ officers given in the OCIMF Vessel Particulars Questionnairereferred to in Clause 1(h) will not change without Charterers’prior agreement.

 

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(b)                   Ownersguarantee that throughout the charter service the master shall with the vessel’sofficers and crew, unless otherwise ordered by Charterers;

 

(i)                       prosecuteall voyages with the utmost despatch;

 

(ii)                    render allcustomary assistance; and

 

(iii)                 load anddischarge cargo as rapidly as possible when required by Charterers or theiragents to do so, by night or by day, but always in accordance with the laws ofthe place of loading or discharging (as the case may be) and in each case inaccordance with any applicable laws of the flag state.

 

**Duty toMaintain**

 

3.                         (a)     Throughoutthe charter service Owners shall, whenever the passage of time, wear and tearor any event (whether or not coming within Clause 27 hereof) requiressteps to be taken to maintain or restore the conditions stipulated in Clauses1 and 2(a), exercise due diligence so to maintain or restore thevessels.

 

(b)                   If at any timewhilst the vessels are on hire under this charter they fail to comply with therequirements of Clauses 1, 2(a) or 10 then hire shallbe reduced to the extent necessary to indemnify Charterers for such failure. Ifand to the extent that such failure affects the time taken by the vessels toperform any services under this charter, hire shall be reduced by an amountequal to the value, calculated at the rate of hire, of the time so lost.

 

Any reduction of hireunder this sub-Clause (b) shall be without prejudice to any otherremedy available to Charterers, but where such reduction of hire is in respectof time lost, such time shall be excluded from any calculation under Clause24.

 

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(c)                    If Owners arein breach of their obligations under Clause 3(a)), Charterers may sonotify Owners in writing and if, after the expiry of 30 days following thereceipt by Owners of any such notice, Owners have failed to demonstrate toCharterers’ reasonable satisfaction the exercise of due diligence as requiredin Clause 3(a), the vessels shall be off-hire, and no further hirepayments shall be due, until Owners have so demonstrated that they areexercising such due diligence.

 

(d)                   Owners shalladvise Charterers immediately, in writing, should either vessel fail aninspection by, but not limited to, a governmental and/or port state authority,and/or terminal and/or major charterer of similar tonnage. Owners shallsimultaneously advise Charterers of their proposed course of action to remedythe defects which have caused the failure of such inspection.

 

(e)                    If, inCharterers reasonably held view:

 

(i)                       failure ofan inspection, or,

 

(ii)                    any finding ofan inspection,

 

referred to in Clause3(d), prevents normal commercial operations then Charterers have the optionto place the vessel off-hire from the date and time that the vessel fails suchinspection, or becomes commercially inoperable, until the date and time thatthe vessel passes a re-inspection by the same organisation, or becomescommercially operable, which shall be in a position no less favourable toCharterers than at which she went off-hire.

 

(f)                      Furthermore,at any time while the vessel is off-hire under this Clause 3 (with theexception of Clause 3(e)(ii)), Charterers have the option toterminate this charter by giving notice in writing with effect from the date onwhich such notice of termination is received by Owners or from any Later datestated in such notice.  This sub-Clause (f) is without prejudice toany rights of Charterers or obligations of Owners under this charter orotherwise (including without limitation Charterers’ rights under Clause 21hereof).

 

**Period,Trading Limits and Safe Places**

 

4.                         (a)     Ownersagree to let and Charterers agree to hire the vessels for a period commencingon or about April 1, 2008 and ending on or about July 14, 2008 plusor minus 30 days in Charterers’ option commencing from the time and date ofdelivery of the vessels, for the purpose of carrying all lawful merchandise(subject always to Clause 28) including in particular crude oil:

 

In any part of the world,as Charterers shall direct, subject to the limits of the current British 

 

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Institute Warranties andany subsequent amendments thereof. Notwithstanding the foregoing, but subject to Clause 35,Charterers may not order the vessels to ice-bound waters or to any part of theworld outside such limits

 

(b)                   Any time duringwhich the vessel is off-hire under this charter may be added to the last firmcharter period in Charterers’ option up to the total amount of time spentoff-hire.  In such cases the rate of hire will be that prevailing at thetime the vessel would, but for the provisions of this Clause, have beenredelivered.

 

(c)                    Charterersshall use due diligence to ensure that the vessels are only employed betweenand at safe places (which expression when used in this charter shall includeports, berths, wharves, docks, anchorages, submarine lines, alongside vesselsor lighters, and other locations including locations at sea) where she cansafely lie always afloat.  Notwithstanding anything contained in this orany other clause of this charter, Charterers do not warrant the safety of anyplace to which they order the vessel and shall be under no liability in respectthereof except for loss or damage caused by their failure to exercise duediligence as aforesaid.  Subject as above, the vessels shall be loaded anddischarged at any places as Charterers may direct, provided that Charterersshall exercise due diligence to ensure that any ship-to-ship transferoperations shall conform to standards not less than those set out in the latestpublished edition of the ICS/OCIMF Ship-to-Ship Transfer Guide.

 

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(d)                   Unlessotherwise agreed, the vessels shall be delivered by Owners dropping outwardpilot at a port in **Delaware Bay**

 

at Owners’ option andredelivered to Owners dropping outward pilot at a port in **DelawareBay,**

 

at Charterers’ option.

 

(e)                    The vesselswill deliver with last cargo(es) of **crude oil**and will redeliver with last cargo(es) of **crude oil**

 

(f)                      Owners arerequired to give Charterers **5** daysprior notice of delivery and Charterers are required to give Owners **5** days prior notice of redelivery.

 

**Laydays/Cancelling**

 

5.                         Thevessels shall not be delivered to Charterers before **April 1,2008** and Charterers shall have the option of cancelling thischarter if the vessels are not ready and at their disposal on or before **April 28, 2008**

 

**Owners toProvide**

 

6.                         Ownersundertake to provide and to pay for all provisions, wages (including but not limitedto all overtime payments), and shipping and discharging fees and all otherexpenses of the master, officers And crew; also, except as provided in Clauses4 and 34 hereof, for all insurance on the vessels, for all Deck,cabin and engine-room stores, and for water (limited to crew only); for alldrydocking, overhaul, maintenance and repairs to the vessels. Owners’obligations under this Clause 6 extend to all liabilities for customs orimport duties arising at any time during the performance of this charter inrelation to the personal effects of the master, officers and crew, and inrelation to the stores, provisions and other matters aforesaid which Owners areto provide and pay for and Owners shall refund to Charterers any sumsCharterers or their agents may have paid or been compelled to pay in respect ofany such liability.  Any amounts allowable in general average for wagesand provisions and stores shall be credited to Charterers insofar as suchamounts are in respect of a Period when the vessels are on-hire.

 

**Charterersto Provide**

 

7.                         (a)     Charterersshall provide and pay for all fuel (except for fuel used for domesticservices), towage and pilotage and shall pay agency fees, port charges,commissions, expenses of loading and unloading cargoes, canal dues, andtax/dues on cargo/freight and all charges other than those payable by Owners inaccordance with Clause 6 hereof, provided that all charges for the saiditems shall be for Owners’ account when such items are consumed, employed orincurred for Owners’ purposes or while the vessels are off-hire (unless suchitems reasonably relate to any service given or distance made good and takeninto account under

 

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Clause 21or 22); and provided further that any fuel used in connection with ageneral average sacrifice or expenditure shall be paid for by Owners. OPAcharges to be paid by Charterers, COFR to be arranged and paid for by Owners.

 

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(b)                   In respect ofbunkers consumed for Owners’ purposes these will be charged on each occasion byCharterers on a “first-in-first-out” basis valued on the prices actually paidby Charterers.

 

(c)                    If the tradinglimits of this charter include ports in the United States of America and/or itsprotectorates then Charterers shall reimburse Owners for port specific chargesrelating to additional premiums charged by providers of oil pollution cover,when incurred by the vessel calling at ports in the United States of America and/orits protectorates in accordance with Charterers orders.

 

**Rate ofHire**

 

8.                         Subjectas herein provided, Charterers shall pay for the use and hire of the vessels atthe rate of United States Dollars **$16,250** perday, and pro rata for any part of a day, from the time and date of her delivery(local time) to Charterers until the time and date of redelivery (local time)to Owners.

 

**Paymentof Hire**

 

9.                         Subjectto Clause 3 (c) and 3 (e), payment of hire shall be made inimmediately available funds

 

to:                                  **JPMorgan Chase Bank**

**New York,New York**

**Account:**  **ABA #021000021**

**ForCredit to Account No. 232-2-407251**

**in thename of OSG Bulk Ships, Inc.**

 

in United States Dollarsper calendar month in advance, less:

 

(i)                       any hirepaid which Charterers reasonably estimate to relate to off-hire periods, and,

 

(ii)                    any amountsdisbursed on Owners’ behalf, any advances and commission therein, and chargeswhich are for Owners’ account pursuant to any provision hereof, and;

 

(iii)                 any amounts dueor reasonably estimated to become due to Charterers under Clause 3(c) or24 hereof,

 

any such adjustments tobe made at the due date for the next monthly payment after the facts have beenascertained. Charterers shall not be responsible for any delay or error byOwners’ bank in crediting Owners’ account provided that Charterers have madeproper and timely payment.

 

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In default of such properand timely payment:

 

(a)                    Owners shallnotify Charterers of such default and Charterers shall within seven days ofreceipt of such notice pay to Owners the amount due, including interest,failing which Owners may withdraw the vessels from the service of Chartererswithout prejudice to any other rights Owners may have under this charter orotherwise; and;

 

(b)                   Interest on anyamount due but not paid on the due date shall accrue from the day after thatdate up to and including the day when payment is made, at a rate per annumwhich shall be 1% above the U.S. Prime Rate as published by the Chase ManhattanBank in New York at 12.00 New York time on the due date, or, if no suchinterest rate is published on that day, the interest rate published for thenext preceding day on which such a rate was so published, computed on the basisof a 360 day year of twelve 30-day months, compounded semi-annualy.

 

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**SpaceAvailable to Charterers**

 

10.           The whole reach, burthen and decks on the vessels andany passenger accommodation (including Owners’ suite) shall be at Charterers’disposal, reserving only proper and sufficient space for the vessel’s master,officers, crew, tackle, apparel, furniture, provisions and stores, providedthat the weight of stores on board shall not, unless specially agreed, exceed **5** tonnes at any time during thecharter period.

 

**SegregatedBallast**

 

11.           In connection with the Council of the European UnionRegulation on the Implementation of IMO Resolution A747(18) Owners will ensurethat the following entry is made on the International Tonnage Certificate(1969) under the section headed “Remarks”.

 

“The segregated ballasttanks comply with the Regulation 13 of Annex 1 of the International Conventionfor the Prevention of Pollution from Ships, 1973, as modified by the Protocolof 1978 relating thereto, and the total tonnage of such tanks exclusively usedfor the carriage of segregated water ballast is **asrequired** The reduced gross tonnage which should be used for thecalculation of tonnage based fees **has been provided toCharterers**”.

 

**Instructionsand Logs**

 

12.           Charterers shall from time to time give the master allrequisite instructions and sailing directions, and the master shall keep a fulland correct log of the voyage or voyages, which Charterers or their agents mayinspect as required.  The master shall when required furnish Charterers ortheir agents with a true copy of such log and with properly completed loadingand discharging port sheets and voyage reports for each voyage and otherreturns as Charterers may require.  Charterers shall be entitled to takecopies at Owners’ expense of any such documents which are not provided by themaster.

 

**Bills ofLading**

 

13.           (a)           The master (although appointed by Owners)shall be under the orders and direction of Charterers as regards employment ofthe vessels, agency and other arrangements, and shall sign Bills of Lading asCharterers or their agents may direct (subject always to Clauses 35(a) and40) without prejudice to this charter.  Charterers hereby indemnifyOwners against all consequences or liabilities that may arise;

 

(i)            from signing Bills of Lading in accordance with thedirections of Charterers or their agents, to the extent that the terms of suchBills of Lading fail to conform to the requirements of this charter, or (exceptas provided in Clause 13(b) from the master otherwisecomplying with Charterers’ or their agents’ orders;

 

(ii)           from any irregularities in papers supplied byCharterers or their agents.

 

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(b)           If Charterers by telex, facsimile or other form ofwritten communication that specifically refers to this Clause request Owners todischarge a quantity of cargo either without Bills of Lading and/or at adischarge place other than that named in a Bill of Lading and/or that isdifferent from the Bill of Lading quantity, then Owners shall discharge suchcargo in accordance with Charterer’s instructions in consideration of receivingthe following indemnity which shall be deemed to be given by Charterers on eachand every such occasion and which is limited in value to 200% of the CIF valueof the cargo carried on board;

 

(i)            Charterers shall indemnify Owners and Owners’ servantsand agents in respect of any liability loss or damage of whatsoever nature(including legal costs as between attorney or solicitor and client andassociated expenses) which Owners may sustain by reason of delivering suchcargo in accordance with Charterers’ request.

 

(ii)           If any proceeding is commenced against Owners or anyof Owners’ servants or agents in connection with the vessels having deliveredcargo in accordance with such request, Charterers shall provide Owners or anyof Owners’ servants or agents from time to time on demand with sufficient fundsto defend the said proceedings.

 

(iii)          If the vessels or any othervessel or property belonging to Owners should be arrested or detained, or ifthe arrest or detention thereof should be threatened, by reason of discharge inaccordance with Charterers instruction as aforesaid, Charterers shall provideon demand such bail or other security as may be required to prevent such arrestor detention or to secure the release of such vessel or property and Charterersshall indemnify Owners in respect of any loss, damage or expenses caused bysuch arrest or detention whether or not same may be justified.

 

(iv)          Charterers shall, if calledupon to do so at any time while such cargo is in Charterers’ possession,custody or control, redeliver the same to Owners.

 

(v)           As soon as all original Billsof Lading for the above cargo which name as discharge port the place wheredelivery actually occurred shall have arrived and/or come into Charterers’possession, Charterers shall produce and deliver the same to Owners whereuponCharterers’ liability hereunder shall cease.

 

Provided however, ifCharterers have not received all such original Bills of Lading by 24.00 hourson the day 36 calendar months after the date of discharge, that this indemnityshall terminate at that time unless before that time Charterers have receivedfrom Owners written notice that:

 

a)             Some person is making a claim in connection withOwners delivering cargo pursuant to Charterers request or,

 

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b)            Legal proceedings have been commenced against Ownersand/or carriers and/or Charterers and/or any of their respective servants oragents and/or the vessel for the same reason.

 

When Charterers havereceived such a notice, then this indemnity shall continue in force until suchclaim or legal proceedings are settled. Termination of this indemnity shall not prejudice any legal rights aparty may have outside this indemnity.

 

(vi)          Owners shall promptly notifyCharterers if any person (other than a person to whom Charterers ordered cargoto be delivered) claims to be entitled to such cargo and/or if the vessels orany other property belonging to Owners is arrested by reason of any suchdischarge of cargo.

 

(vii)         This indemnity shall begoverned and construed in accordance with United States law.

 

(c)           Owners warrant that theMaster will comply with orders to carry and discharge against one or more Billsof Lading from a set of original negotiable Bills of Lading should Charterersso require.

 

**Conductof Vessel’s Personnel**

 

14.           If Charterers complain of the conduct of the master orany of the officers or crew, Owners shall immediately investigate thecomplaint.  If the complaint proves to be well founded, Owners shall,without delay, make a change in the appointments and Owners shall in any eventcommunicate the result of their investigations to Charterers as soon aspossible.

 

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**Bunkers atDelivery and Redelivery**

 

15.           Charterers shall accept and pay for all bunkers onboard at the time of delivery, and Owners shall on redelivery (whether itoccurs at the end of the charter or on the earlier termination of this charter)accept and pay for all bunkers remaining on board, at the price actually paid,on a “first-in-first-out” basis.  Such prices are to be supported by paidinvoices.

 

Vessels to be deliveredto and redelivered from the charter with, at least, a quantity of bunkers onboard sufficient to reach the nearest main bunkering port.

 

Notwithstanding anythingcontained in this charter all bunkers on board the vessel shall, throughout theduration of this charter, remain the property of Charterers and can only bepurchased on the terms specified in the charter at the end of the charterperiod or, if earlier, at the termination of the charter.

 

**Stevedores,Pilots, Tugs**

 

16.           Stevedores, when required, shall be employed and paidby Charterers, but this shall not relieve Owners from responsibility at alltimes for proper stowage, which must be controlled by the master who shall keepa strict account of all cargo loaded and discharged.  Owners herebyindemnify Charterers, their servants and agents against all losses, claims,responsibilities and liabilities arising in any way whatsoever from theemployment of pilots, tugboats or stevedores, who although employed byCharterers shall be deemed to be the servants of and in the service of Ownersand under their instructions (even if such pilots, tugboat personnel orstevedores are in fact the servants of Charterers their agents or anyaffiliated company); provided, however, that:

 

(a)           the foregoing indemnity shall not exceed the amount towhich Owners would have been entitled to limit their liability if they hadthemselves employed such pilots, tugboats or stevedores, and;

 

(b)           Charterers shall be liable for any damage to thevessels caused by or arising out of the use of stevedores, fair wear and tearexcepted, to the extent that Owners are unable by the exercise of due diligenceto obtain redress therefor from stevedores.

 

**Super-Numeraries**

 

17.           Charterers may send representatives in the vessel’savailable accommodation upon any voyage made under this charter, Owners findingprovisions and all requisites as supplied to officers, except alcohol. Charterers paying at the rate of United States Dollars 15 (fifteen) per day foreach representative while on board the vessels.

 

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**Sub-letting/Assignment/Novation**

 

18.           Charterers may sub-let the vessels, but shall alwaysremain responsible to Owners for due fulfilment of this charter.

 

**FinalVoyage**

 

19.           If when a payment of hire is due hereunder Charterersreasonably expect to redeliver the vessels before the next payment of hirewould fall due, the hire to be paid shall be assessed on Charterers’ reasonableestimate of the time necessary to complete Charterers’ programme up toredelivery, and from which estimate Charterers may deduct amounts due orreasonably expected to become due for:

 

(a)           disbursements on Owners’ behalf or charges for Owners’account pursuant to any provision hereof, and;

 

(b)           bunkers on board at redelivery pursuant to Clause 15.

 

Promptly after redeliveryany overpayment shall be refunded by Owners or any underpayment made good byCharterers.

 

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If at the time thischarter would otherwise terminate in accordance with Clause 4 the vesselsare on a ballast voyage to a port of redelivery or is upon a laden voyage,Charterers shall continue to have the use of the vessels at the same rate andconditions as stand herein for as long as necessary to complete such ballastvoyage, or to complete such laden voyage and return to a port of redelivery asprovided by this charter, as the case may be.

 

**Loss ofVessel**

 

20.           Should the vessels be lost, this charter shallterminate and hire shall cease at noon (GMT) on the day of the loss; should thevessels be a constructive total loss, this charter shall terminate and hireshall cease at noon on the day on which the vessels’ underwriters agree thatthe vessels are a constructive total loss; should the vessels be missing, thischarter shall terminate and hire shall cease at noon on the day on which theywere last heard of.  Any hire paid in advance and not earned shall bereturned to Charterers and Owners shall reimburse Charterers for the value ofthe estimated quantity of bunkers on board at the time of termination, at theprice paid by Charterers at the last bunkering port.

 

**Off-hire**

 

21.           (a)           On each and every occasion that there isloss of time (whether by way of interruption in the vessels’ service or, fromreduction in the vessels’ performance, or in any other manner):

 

(i)            due to deficiency of personnel or stores; repairs;gas-freeing for repairs; time in and waiting to enter dry dock for repairs;breakdown (whether partial or total) of machinery, boilers or other parts ofthe vessels or their equipment (including without limitation tank coatings);overhaul, maintenance or survey; collision, stranding, accident or damage tothe vessels; or any other similar cause preventing the efficient working of thevessels; and such loss continues for more than three consecutive hours (ifresulting from interruption in the vessels’ service) or cumulates to more thanthree hours (if resulting from partial loss of service); or;

 

(ii)           due to industrial action, refusal to sail, breach oforders or neglect of duty on the part of the master, officers or crew; or;

 

(iii)          for the purpose of obtaining medical advice ortreatment for or landing any sick or injured person (other than a Charterers’representative carried under Clause 17 hereof) or for the purposeof landing the body of any person (other than a Charterers’ representative), andsuch loss continues for more than three consecutive hours; or;

 

(iv)          due to any delay in quarantine arising from themaster, officers or crew having had communication with the shore at anyinfected area without the written consent or instructions of Charterers ortheir agents, or to any detention by customs or other authorities caused bysmuggling or other infraction of local law on the part of the master, officers,or crew; or;

 

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(v)           due to detention of the vessels by authorities at homeor abroad attributable to legal action against or breach of regulations by thevessels, the vessels’ owners, or Owners (unless brought about by the act orneglect of Charterers); then;

 

without prejudice toCharterers’ rights under Clause 3 or to any other rights ofCharterers hereunder, or otherwise, the vessels shall be off-hire from thecommencement of such loss of time until they are again ready and in anefficient state to resume service from a position not less favourable toCharterers than that at which such loss of time commenced; provided, however,that any service given or distance made good by the vessels whilst off-hireshall be taken into account in assessing the amount to be deducted from hire.

 

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(b)           If the vessels fail to proceed at any guaranteed speedpursuant to Clause 24, and such failure arises wholly or partlyfrom any of the causes set out in Clause 21(a) above, then theperiod for which the vessels shall be off-hire under this Clause 21shall be the difference between:

 

(i)            the time the vessels would have required to performthe relevant service at such guaranteed speed, and;

 

(ii)           the time actually taken to perform such service(including any loss of time arising from interruption in the performance ofsuch service).

 

For the avoidance ofdoubt, all time included under (ii) above shall be excluded from anycomputation under Clause 24.

 

(c)           Further and without prejudice to the foregoing, in theevent of the vessels deviating (which expression includes without limitationputting back, or putting into any port other than that to which she is boundunder the instructions of Charterers) for any cause or purpose mentioned in Clause21(a), the vessels shall be off-hire from the commencement of suchdeviation until the time when they are again ready and in an efficient state toresume her service from a position not less favourable to Charterers than thatat which the deviation commenced, provided, however, that any service given ordistance made good by the vessel whilst so off-hire shall be taken into accountin assessing the amount to be deducted from hire.  If the vessels, for anycause or purpose mentioned in Clause 21(a), put into any port other thanthe port to which they are bound on the instructions of Charterers, the portcharges, pilotage and other expenses at such port shall be borne byOwners.  Should the vessels be driven into any port or anchorage by stressof weather hire shall continue to be due and payable during any time lostthereby.

 

(d)           If the vessels’ flag state becomes engaged inhostilities, and Charterers in consequence of such hostilities find itcommercially impracticable to employ the vessels and have given Owners writtennotice thereof then from the date of receipt by Owners of such notice until thetermination of such commercial impracticability the vessel shall be off-hireand Owners shall have the right to employ the vessels on their own account.

 

(e)           Time during which the vessel is off-hire under thischarter shall count as part of the charter period except where Charterersdeclare their option to add off-hire periods under Clause 4(b)).

 

(f)            All references to “time” in this charter party shallbe references to local time except where otherwise stated.

 

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**PeriodicalDrydocking**

 

22.           (a)           Owners have the right and obligation todrydock the vessels at regular intervals **as required**On each occasion Owners shall propose to Charterers a date on which they wishto drydock the vessel, not less than **30 days**before such date and Charterers shall offer a port for such periodicaldrydocking and shall take all reasonable steps to make the vessel available asnear to such date as practicable.

 

Owners shall put thevessels in drydock at their expense as soon as practicable after Charterersplace the vessels at Owners’ disposal clear of cargo other than tank washingsand residues.  Owners shall be responsible for and pay for the disposalinto reception facilities of such tank washings and residues and shall have theright to retain any monies received therefore, without prejudice to any claimfor loss of cargo under any Bill of Lading or this charter.

 

(b)           If a periodical drydocking is carried out in the portoffered by Charterers (which must have suitable accommodation for the purposeand reception facilities for tank washings and residues), the vessels shall beoff-hire from the time she arrives at such port until drydocking is completedand she is in every way ready to resume Charterers’ service and is at theposition at which they went off-hire or a position no less favourable toCharterers, whichever she first attains. However;

 

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(i)            provided that Owners exercise due diligence ingas-freeing, any time lost in gas-freeing to the standard required for entryinto drydock for cleaning and painting the hull shall not count as off-hire,whether lost on passage to the drydocking port or after arrival there (notwithstandingClause 21), and;

 

(ii)           any additional time lost in further gas-freeing tomeet the standard required for hot work or entry to cargo tanks shall count asoff-hire, whether lost on passage to the drydocking port or after arrivalthere.

 

Any time which, but forsub-Clause (i) above, would be off-hire, shall not be included in anycalculation under Clause 24.

 

The expenses ofgas-freeing, including without limitation the cost of bunkers, shall be forOwners’ account.

 

(c)           If Owners require the vessels, instead of proceedingto the offered port, to carry out periodical drydocking at a special portselected by them, the vessel shall be off-hire from the time when she isreleased to proceed to the special port until she next presents for loading inaccordance with Charterers’ instructions, provided, however, that Charterersshall credit Owners with the time which would have been taken on passage at theservice speed had the vessels not proceeded to drydock.  All fuel consumedshall be paid for by Owners but Charterers shall credit Owners with the valueof the fuel which would have been used on such notional passage calculated atthe guaranteed daily consumption for the service speed, and shall furthercredit Owners with any benefit they may gain in purchasing bunkers at thespecial port.

 

(d)           Charterers shall, insofar as cleaning for periodicaldrydocking may have reduced the amount of tank-cleaning necessary to meetCharterers’ requirements, credit Owners with the value of any bunkers whichCharterers calculate to have been saved thereby, whether the vessels drydock atan offered or a special port.

 

**ShipInspection**

 

23.           Charterers shall have the right at any time during thecharter period to make such inspection of the vessels as they may considernecessary.  This right may be exercisedas often and at such intervals as Charterers in their absolute discretion maydetermine and whether the vessels are in port or on passage.  Owners affording all necessary co-operationand accommodation on board provided, however:

 

(a)           that neither the exercise northe non-exercise, nor anything done or not done in the exercise ornon-exercise, by Charterers of such right shall in any way reduce the master’sor Owners’ authority over, or responsibility to Charterers or third partiesfor, the vessels and every aspect of their operation, nor increase Charterers’responsibilities to Owners or third parties for the same; and;

 

19

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(b)           that Charterers shall not beliable for any act, neglect or default by themselves, their servants or agentsin the exercise or non-exercise of the aforesaid right.

 

**DetailedDescription and Performance**

 

24.           Owners guarantee that the speed and consumption of thevessels shall be as agreed with Charterers.

 

**Salvage**

 

25.           Subject to the provisions of Clause 21 hereof,all loss of time and all expenses (excluding any damage to or loss of thevessels or tortious liabilities to third parties) incurred in saving orattempting to save life or in successful or unsuccessful attempts at salvageshall be borne equally by Owners and Charterers provided that Charterers shallnot be liable to contribute towards any salvage payable by Owners arising inany way out of services rendered under this Clause 25.

 

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All salvage and allproceeds from derelicts shall be divided equally between Owners and Charterersafter deducting the master’s, officers’ and crew’s share.

 

**Lien**

 

26.           Owners shall have a lien upon all cargoes and allfreights, sub-freights and demurrage for any amounts due under this charter;and Charterers shall have a lien on the vessels for all monies paid in advanceand not earned, and for all claims for damages arising from any breach byOwners of this charter.

 

**Exceptions**

 

27.           (a)           The vessels, their master and Ownersshall not, unless otherwise in this charter expressly provided, be liable forany loss or damage or delay or failure arising or resulting from any act,neglect or default of the master, pilots, mariners or other servants of Ownersin the navigation or management of the vessel; fire, unless caused by theactual fault or privity of Owners; collision or stranding; dangers andaccidents of the sea; explosion, bursting of boilers, breakage of shafts or anylatent defect in hull, equipment or machinery; provided, however, that Clauses1, 2, 3, and 24 hereof shall be unaffected by theforegoing.  Further, neither the vessels, their master or Owners, nor Charterersshall, unless otherwise in this charter expressly provided, be liable for anyloss or damage or delay or failure in performance hereunder arising orresulting from act of God, act of war, seizure under legal process, quarantinerestrictions, strikes, lock-outs, riots, restraints of labour, civil commotionsor arrest or restraint of princes, rulers or people.

 

(b)           The vessels shall have liberty to sail with or withoutpilots, to tow or go to the assistance of vessels in distress and to deviatefor the purpose of saving life or property.

 

(c)           Clause 27(a) shall not apply to, or affect any liability ofOwners or the vessels or any other relevant person in respect of:

 

(i)            loss or damage caused to any berth, jetty, dock,dolphin, buoy, mooring line, pipe or crane or other works or equipmentwhatsoever at or near any place to which the vessels may proceed under thischarter, whether or not such works or equipment belong to Charterers, or;

 

(ii)           any claim (whether brought by Charterers or any otherperson) arising out of any loss of or damage to or in connection with cargo. Any such claim shall be subject to the Hague-Visby Rules or theHague Rules or the Hamburg Rules, as the case may be, which ought pursuantto Clause 38 hereof to have been incorporated in the relevant Bill ofLading (whether or not such Rules were so incorporated) or, if no suchBill of Lading is issued, to the Hague-Visby Rules unless the Hamburg Rules compulsorilyapply in which case to the Hamburg Rules.

 

(d)           In particular and without limitation, the foregoing subsections(a) and (b) of this Clause shall 

 

21

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not apply to or in anyway affect any provision in this charter relating to off-hire or to reductionof hire.

 

**InjuriousCargoes**

 

28.           No acids, explosives or cargoes injurious to thevessel shall be shipped and without prejudice to the foregoing any damage tothe vessels caused by the shipment of any such cargo, and the time taken torepair such damage, shall be for Charterers’ account.  No voyage shall beundertaken, nor any goods or cargoes loaded, that would expose the vessel tocapture or seizure by rulers or governments.

 

**Grade ofBunkers**

 

29.           Charterers shall supply fuel as required for thevessels.  If Owners require the vesselsto be supplied with more expensive bunkers they shall be liable for the extracost thereof.

 

Charterers warrant thatall bunkers provided by them in accordance herewith shall be of a qualitycomplying with ISO Standard 8217 for Marine Residual Fuels and MarineDistillate Fuels as applicable.

 

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**Disbursements**

 

30.           Should the master require advances for ordinarydisbursements at any port, Charterers or their agents shall make such advancesto him, in consideration of which Owners shall pay a commission of two and ahalf per cent, and all such advances and commission shall be deducted fromhire.

 

**Laying-up**

 

31.           Charterers shall have the option, after consultationwith Owners, of requiring Owners to lay up the vessels at a safe placenominated by Charterers, in which case the hire provided for under this chartershall be adjusted to reflect any net increases in expenditure reasonablyincurred or any net saving which should reasonably be made by Owners as a resultof such lay up.  Charterers may exercise the said option any number oftimes during the charter period.

 

**Requisition**

 

32.           Should the vessels be requisitioned by any government,de facto or de jure, during the period of this charter, the vessels shall beoff-hire during the period of such requisition, and any hire paid by suchgovernments in respect of such requisition period shall be for Owners’ account. Any such requisition period shall not count as part of the charterperiod.

 

**Outbreakof War**

 

33.           If war or hostilities break out between any two ormore of the following countries: U.S.A., the countries or republics having beenpart of the former U.S.S.R. (except that declaration of war or hostilitiessolely between any two or more of the countries or republics having been partof the former USSR shall be exempted), P.R.C., U.K., Netherlands, then bothOwners and Charterers shall have the right to cancel this charter.

 

**AdditionalWar Expenses**

 

34.           If the vessels are ordered to trade in areas wherethere is war (de facto or de jure) or threat of war, Charterers shall reimburseOwners for any additional insurance premia, crew bonuses and other expenseswhich are reasonably incurred by Owners as a consequence of such orders,provided that Charterers are given notice of such expenses as soon aspracticable and in any event before such expenses are incurred, and providedfurther that Owners obtain from their insurers a waiver of any subrogatedrights against Charterers in respect of any claims by Owners under their warrisk insurance arising out of compliance with such orders.

 

Any payments byCharterers under this Clause will only be made against provendocumentation.  Any discount or rebate refunded to Owners, for whateverreason, in respect of additional war risk premium shall be passed on toCharterers.

 

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**WarRisks**

 

35.           (a)           The master shall not be required or boundto sign Bills of Lading for any place which in his or Owners’ reasonableopinion is dangerous or impossible for the vessel to enter or reach owing toany blockade, war, hostilities, warlike operations, civil war, civil commotionsor revolutions.

 

(b)           If in the reasonable opinion of the master or Ownersit becomes, for any of the reasons set out in Clause 35(a) or bythe operation of international law, dangerous, impossible or prohibited for thevessel to reach or enter, or to load or discharge cargo at, any place to whichthe vessels have been ordered pursuant to this charter (a “place of peril”), thenCharterers or their agents shall be immediately notified in writing or by radiomessages, and Charterers shall thereupon have the right to order the cargo, orsuch part of it as may be affected, to be loaded or discharged, as the case maybe, at any other place within the trading limits of this charter (provided suchother place is not itself a place of peril).  If any place of discharge isor becomes a place of peril, and no orders have been received from Charterersor their agents within 48 hours after dispatch of such messages, then Ownersshall be at liberty to discharge the cargo or such part of it as may beaffected at any place which they or the master may in their or his discretionselect within the trading limits of this charter and such discharge shall bedeemed to be due fulfilment of Owners’ obligations under this charter so far ascargo so discharged is concerned.

 

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(c)           The vessels shall have liberty to comply with anydirections or recommendations as to departure, arrival, routes, ports of call,stoppages, destinations, zones, waters, delivery or in any other wisewhatsoever given by the government of the state under whose flag the vesselssail or any other government or local authority or by any person or body actingor purporting to act as or with the authority of any such government or localauthority including any de facto government or local authority or by any personor body acting or purporting to act as or with the authority of any suchgovernment or local authority or by any committee or person having under theterms of the war risks insurance on the vessel the right to give any suchdirections or recommendations.  If by reason of or in compliance with anysuch directions or recommendations anything is done or is not done, such shallnot be deemed a deviation.  If by reason of or in compliance with any suchdirection or recommendation the vessels do not proceed to any place ofdischarge to which she has been ordered pursuant to this charter, the vesselsmay proceed to any place which the master or Owners in his or their discretionselect and there discharge the cargo or such part of it as may be affected.Such discharge shall be deemed to be due fulfilment of Owners’ obligationsunder this charter so far as cargo so discharged is concerned.

 

Charterers shall procurethat all Bills of Lading issued under this charter shall contain the Chamber ofShipping War Risks Clause 1952.

 

**Both toBlame Collision Clause**

 

36.           If the liability for any collision in which the vesselis involved while performing this charter fails to be determined in accordancewith the laws of the United States of America, the following provision shallapply:

 

“If the ship comes intocollision with another ship as a result of the negligence of the other ship andany act, neglect or default of the master, mariner, pilot or the servants ofthe carrier in the navigation or in the management of the ship, the owners ofthe cargo carried hereunder will indemnify the carrier against all loss, orliability to the other or non-carrying ship or her owners in so far as suchloss or liability represents loss of, or damage to, or any claim whatsoever ofthe owners of the said cargo, paid or payable by the other or non-carrying shipor her owners to the owners of the said cargo and set off, recouped orrecovered by the other or non-carrying ship or her owners as part of theirclaim against the carrying ship or carrier.”

 

“The foregoing provisionsshall also apply where the owners, operators or those in charge of any ship orships or objects other than, or in addition to, the colliding ships or objectsare at fault in respect of a collision or contact.”

 

Charterers shall procurethat all Bills of Lading issued under this charter shall contain a provision inthe foregoing terms to be applicable where the liability for any collision inwhich the vessels are involved fails to be determined in accordance with thelaws of the United States of America.

 

**NewJason Clause**

 

37.           General average contributions shall be payableaccording to York/Antwerp Rules, 1994 as amended from time to time, and shallbe adjusted in London in accordance with English law and 

 

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practice but shouldadjustment be made in accordance with the law and practice of the United Statesof America, the following position shall apply:

 

“In the event ofaccident, danger, damage or disaster before or after the commencement of thevoyage, resulting from any cause whatsoever, whether due to negligence or not,for which, or for the consequence of which, the carrier is not responsible bystatute, contract or otherwise, the cargo, shippers, consignees or owners ofthe cargo shall contribute with the carrier in general average to the payment ofany sacrifices, losses or expenses of a general average nature that may be madeor incurred and shall pay salvage and special charges incurred in respect ofthe cargo.”

 

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“If a salving ship isowned or operated by the carrier, salvage shall be paid for as fully as if thesaid salving ship or ships belonged to strangers.  Such deposit as thecarrier or his agents may deem sufficient to cover the estimated contributionof the cargo and any salvage and special charges thereon shall, if required, bemade by the cargo, shippers, consignees or owners of the cargo to the carrierbefore delivery.”

 

Charterers shall procurethat all Bills of Lading issued under this charter shall contain a provision inthe foregoing terms, to be applicable where adjustment of general average ismade in accordance with the laws and practice of the United States of America.

 

**ClauseParamount**

 

38.           Charterers shall procure that all Bills of Ladingissued pursuant to this charter shall contain the following:

 

“(1) Subject tosub-Clause (2) or (3) hereof, this Bill of Lading shall be governedby, and have effect subject to, the rules contained in the InternationalConvention for the Unification of Certain Rules relating to Bills ofLading signed at Brussels on 25th August 1924 (hereafter the “Hague Rules”)as amended by the Protocol signed at Brussels on 23rd February 1968(hereafter the “Hague-Visby Rules”).  Nothing contained herein shall bedeemed to be either a surrender by the carrier of any of his rights orimmunities or any increase of any of his responsibilities or liabilities underthe Hague-Visby Rules.”

 

“(2) If there isgoverning legislation which applies the Hague Rules compulsorily to thisBill of Lading, to the exclusion of the Hague-Visby Rules, then this Bill ofLading shall have effect subject to the Hague Rules.  Nothing thereincontained shall be deemed to be either a surrender by the carrier of any of hisrights or immunities or an increase of any of his responsibilities orliabilities under the Hague Rules.”

 

“(3) If there isgoverning legislation which applies the United Nations Convention on theCarriage of Goods by Sea 1978 (hereafter the “Hamburg Rules”) compulsorily tothis Bill of Lading, to the exclusion of the Hague-Visby Rules, then this Billof Lading shall have effect subject to the Hamburg Rules.  Nothing thereincontained shall be deemed to be either a surrender by the carrier of any of hisrights or immunities or an increase of any of his responsibilities or liabilitiesunder the Hamburg Rules.”

 

“(4) If any term ofthis Bill of Lading is repugnant to the Hague-Visby Rules, or Hague Rules, orHamburg Rules, as applicable, such term shall be void to that extent but nofurther.”

 

“(5) Nothing in thisBill of Lading shall be construed as in any way restricting, excluding orwaiving the right of any relevant party or person to limit his liability underany available legislation and/or law.”

 

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**Insurance/ITOPF**

 

39.           Owners warrant that the vessels are now, and will,throughout the duration of the charter:

 

(a)           be owned or demise chartered by a member of theInternational Tanker Owners Pollution Federation Limited;

 

(b)           be properly entered in **a**P & I Club, being a member of the International Group of P &I Clubs;

 

(c)           have in place insurance cover for oil pollution forthe maximum on offer through the International Group of P & l Clubsbut always a minimum of United States Dollars 1,000,000,000 (one thousandmillion);

 

(d)           have in full force and effect Hull and Machineryinsurance placed through reputable brokers on Institute Time Clauses orequivalent for the market value agreed by Owners and Charterers.

 

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Owners will provide,within a reasonable time following a request from Charterers to do so,documented evidence of compliance with the warranties given in this Clause 39.

 

**ExportRestrictions**

 

40.           The master shall not be required or bound to signBills of Lading for the carriage of cargo to any place to which export of suchcargo is prohibited under the laws, rules or regulations of the country inwhich the cargo was produced and/or shipped.

 

Charterers shall procurethat all Bills of Lading issued under this charter shall contain the followingclause:

 

“If any laws rules orregulations applied by the government of the country in which the cargo wasproduced and/or shipped, or any relevant agency thereof, impose a prohibitionon export of the cargo to the place of discharge designated in or ordered underthis Bill of Lading, carriers shall be entitled to require cargo ownersforthwith to nominate an alternative discharge place for the discharge of thecargo, or such part of it as may be affected, which alternative place shall notbe subject to the prohibition, and carriers shall be entitled to accept ordersfrom cargo owners to proceed to and discharge at such alternative place. If cargo owners fail to nominate an alternative place within 72 hours afterthey or their agents have received from carriers notice of such prohibition,carriers shall be at liberty to discharge the cargo or such part of it as maybe affected by the prohibition at any safe place on which they or the mastermay in their or his absolute discretion decide and which is not subject to theprohibition, and such discharge shall constitute due performance of thecontract contained in this Bill of Lading so far as the cargo so discharged isconcerned”.

 

The foregoing provisionshall apply mutatis mutandis to this charter, the references to a Bill ofLading being deemed to be references to this charter.

 

**BusinessPrinciples**

 

41.           (Deleted)

 

**Drugsand Alcohol**

 

42.           (a) Owners warrant that they have in force anactive policy covering the vessels which meets or exceeds the standards set outin the “Guidelines for the Control of Drugs and Alcohol On Board Ship” aspublished by the Oil Companies International Marine Forum (OCIMF) dated January 1990(or any subsequent modification, version, or variation of these guidelines) andthat this policy will remain in force throughout the charter period, and Ownerswill exercise due diligence to ensure the policy is complied with.

 

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.        (b) Owners warrant that the current policyconcerning drugs and alcohol on board is acceptable to ExxonMobil and willremain so throughout the charter period.

 

**OilMajor Acceptability**

 

43.    If,at any time during the charter period, the vessels become unacceptable to anyOil Major, Charterers shall have the right to terminate the charter.

 

**Pollutionand Emergency Response**

 

44.    Ownersare to advise Charterers of organisational details and names of Ownerspersonnel together with their relevant telephone/facsimile/e-mail/telexnumbers, including the names and contact details of Qualified Individuals forOPA 90 response, who may be contacted on a 24 hour basis in the event of oilspills or emergencies.

 

**ISPSCode/US MTSA 2002**

 

45.           (a).          (i)             From the date of coming into force of theInternational Code for the Security of Ships and of Port Facilities and therelevant amendments to Chapter XI of SOLAS (ISPS Code) and the US MaritimeTransportation Security Act 2002 (MTSA) in relation to the Vessel andthereafter during the currency of this charter, Owners shall procure that boththe Vessel and “the Company” (as defined by the ISPS Code) and the “owner” (asdefined by the MTSA) shall comply with the requirements of the ISPS Coderelating to the Vessel and “the Company” and the requirements of MTSA relatingto the vessel and the “owner”.  Uponrequest Owners shall provide documentary evidence of compliance with this Clause45(a) (i).

 

(ii)    Except as otherwise provided in this charter,loss, damage, expense or delay, caused by failure on the part of Owners or “theCompany”/”owner” to comply with the requirements of the ISPS Code/MTSA or thisClause shall be for Owners’ account.

 

(b).   (i)            Charterers shall provide Owners/Master withtheir full style contact details and shall ensure that the contact details ofall sub-charterers are likewise provided to Owners/Master.  Furthermore, Charterers shall ensure that allsub-charter parties they enter into during the period of this charter containthe following provision:

 

“TheCharterers shall provide the Owners with their full style contact details and,where sub-letting is permitted under the terms of the charter party, shallensure that the contact details of all sub-charterers are likewise provided tothe Owners”.

 

(ii)    Except as otherwise provided in this charter,loss, damage, expense or delay, caused by failure on the part of Charterers tocomply with this sub-Clause 45(b) shall be for Charterers’ account.

 

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(c).   Notwithstanding anything else contained inthis charter costs or expenses related to security regulations or measuresrequired by the port facility or any relevant authority in accordance with theISPS Code/MTSA including, but not limited to, security guards, launch services,tug escorts, port security fees or taxes and inspections, shall be forCharterers’ account, unless such costs or expenses result solely from Owners’negligence in which case such costs or expenses shall be for Owners’account.  All measures required by Ownersto comply with the security plan required by the ISPS Code/MTSA shall be forOwners’ account.

 

(d).   Notwithstanding any other provision of thischarter, the vessels shall not be off-hire where there is a loss of time causedby Charterers’ failure to comply with the ISPS code/MTSA (when in force).

 

(e).   If either party makes any payment which isfor the other party’s account according to this Clause, the other party shallindemnify the paying party.

 

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**Law andLitigation**

 

46.       (Deleted)

 

**Confidentiality**

 

47.       Allterms and conditions of this charter arrangement shall be kept private andconfidential, except as required by applicable law

 

**Construction**

 

48.       Theside headings have been included in this charter for convenience of referenceand shall in no way affect the construction hereof.

 

Additional Clauses:   Asattached, shall be incorporated herein.

 

 
| **SIGNED FOR OWNERS** |                      | **SIGNED FOR CHARTERES** |
|-----------------------|---------------------------|--------------------------|
| **OSG 300 LLC**       |                      | **OSP 300 LLC**          |
|                  |                      |                     |
| By:                   | /s/  James I. Edelson     |                     | By: | /s/ Jerry Miller |
|                  |                      |                     |   |   |   |
|                  | Name:James I. Edelson     |                     |   | Name: | Jerry Miller |
|                  | Title:  Manager |                     |   | Title: | Manager |
|                  |                      |                     |   |   |
|                  |                      |                     |   |   |
| **OSG LIBERTY LLC**   |
|                  |                      |
| By:                   | /s/  Myles R. Itkin       |                     |   |
|                  |                      |                     |   |   |
|                  | Name:                     | Myles R. Itkin           |   |   |
|                  | Title:                    | Manager                  |   |   |
|                       |                           |                          |  |  |  |  |  |

 

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**Additional Terms**

**To the time charter dated April 1,2008 between: (a) OSG 300 LLC and OSG Liberty LLC; and (b) OSP 300LLC**

 
| **1.** | **Charterhire,  Payments and Expense**            |                            |
|--------|---------------------------------------------------|---------------------------------|
|   | 1.1                                               | OWNER’S  BANK              |   |
|   | 1.2                                               | TIME  CHARTER HIRE RATE         |   |
|   | 1.3                                               | OWNER’S  ITEMS             |   |
|   | 1.4                                               | COMMISSION                      |   |
|   | 1.5                                               | HIRE  PAYMENT                   |   |
|   | 1.6                                               | OPA/COFR  EXPENSES              |   |
|   |                                              |                            |   |
| **2.** | **Delivery/Redelivery  and Trading**              |                            |
|   | 2.1                                               | DELIVERY                        |   |
|   | 2.2                                               | REDELIVERY                      |   |
|   | 2.3                                               | TRADING  AREAS AND EXCLUSIONS   |   |
|   | 2.4                                               | NOTICE  OF DELIVERY/REDELIVERY  |   |
|   | 2.5                                               | BUNKERS  ON DELIVERY/REDELIVERY |   |
|   | 2.6                                               | OFF-HIRE  PERIOD(S)             |   |
|   | 2.7                                               | BOYCOTT                         |   |
|   | 2.8                                               | TRADING  WHILE OFF-HIRE         |   |
|   | 2.9                                               | DRYDOCKING                      |   |
|   | 2.10                                              | LAY-UP                          |   |
|   |                                              |                            |   |
| **3.** | **Vessel Operations, Performance and Warranties** |                            |
|   | 3.1                                               | SPILL  PREVENTION               |   |
|   | 3.2                                               | OILY  WASTE                     |   |
|   | 3.3                                               | SPEEDS/CONSUMPTIONS             |   |
|   | 3.4                                               | HEATING                         |   |
|   | 3.5                                               | SHIP  TO SHIP TRANSFER          |   |
|   | 3.6                                               | CARGO  MANIFOLDS                |   |
|   | 3.7                                               | CRUDE  OIL WASH (COW)           |   |
|   | 3.8                                               | INERT  GAS SYSTEM               |   |
|   | 3.9                                               | SURVEY  AND SAMPLE              |   |
|   | 3.10                                              | COMMINGLING/BLENDING            |   |
|   | 3.11                                              | CARGO  RETENTION                |   |
|   | 3.12                                              | LOADING  WARRANTY               |   |
|   | 3.13                                              | PUMPING  PERFORMANCE WARRANTY   |   |
|   | 3.14                                              | DRAWINGS/DATA                   |   |
|   | 3.15                                              | REMEASUREMENT                   |   |
|   | 3.16                                              | ETA                             |   |
|   | 3.17                                              | CBM  MOORING EQUIPMENT          |   |
|        |                                                   |                                 |  |  |

 

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|   | 3.18                            | SEA  TERMINALS                                          |   |
|--------|---------------------------------|---------------------------------------------------------|--------|
|   | 3.19                            | COMMUNICATION  EQUIPMENT                                |   |
|   | 3.20                            | INMARSAT  TRACKING                                      |   |
|   | 3.21                            | MANNING                                                 |   |
|   | 3.22                            | OWNERSHIP/FLAG                                          |   |
|   |                            |                                                    |   |
| **4.** | **Eligibility  and Compliance** |                                                    |
|   | 4.1                             | APPROVALS                                               |   |
|   | 4.2                             | ELIGIBILITY                                             |   |
|   | 4.3                             | I.T.F.                                                  |   |
|   | 4.4                             | DRUG  AND ALCOHOL POLICY                                |   |
|   | 4.5                             | SOLAS/MARPOL                                            |   |
|   | 4.6                             | ITOPF                                                   |   |
|   | 4.7                             | JAPAN  MARITIME DISASTER PREVENTION CENTER CERTIFICATES |   |
|   |                            |                                                    |   |
| **5.** | **Legal Provisions**            |                                                    |
|   | 5.1                             | LAW  AND LITIGATION                                     |   |
|   | 5.2                             | AFFILIATES’  CLAIMS                                |   |
|   | 5.3                             | ASSIGNMENT                                              |   |
|   | 5.4                             | TENDER  OF NOTICE                                       |   |
|   | 5.5                             | INSURANCE                                               |   |
|   | 5.6                             | WAR                                                     |   |
|   | 5.7                             | BILL(S) OF  LADING/INDEMNITY                       |   |
|   | 5.8                             | CONFIDENTIALITY                                         |   |
|   | 5.9                             | LOSS  OF VESSEL                                         |   |
|   | 5.10                            | CONFLICTS  OF INTEREST                                  |   |
|   | 5.11                            | CONTRACT  INTERPRETATION                                |   |

 

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| **1.** | **Charterhire,  Payments and Expense** |                    |
|--------|----------------------------------------|-------------------------|
|   |                                   |                    |   |
|   | 1.1                                    | OWNER’S  BANK      |   |
|   |                                   |                    |   |
|   | See  clause 9 of the Shelltime 4 form. |                    |
|   |                                   |                    |   |
|   | 1.2                                    | TIME  CHARTER HIRE RATE |   |
|   |                                   |                    |   |
|   | See  clause 8 of the Shelltime 4 form  |                    |

 

1.3       OWNER’S ITEMS

 

Itis understood that Owner shall pay for all customary Owner’s costs including,but not limited to, sealing ship’s stores, legalization of crew list, gangway,garbage dues, sick mariner dues, sailor’s home, mission to seamen, lifeboatinstitution at each port and, when off hire, fuel for domestic services.  Owner shall be responsible for settling allof its expenses directly with agents.

 

1.4       COMMISION:

 

None

 

1.5       HIRE PAYMENT

 

Notwithstandingthe provisions of Clause 9 of the Shelltime 4 form, Charterer shall: (a) notbe responsible for any delay or error by Owner’s bank in crediting Owner’saccount provided that Charterer has made proper and timely payments; and (b) beresponsible for any delay or error caused by Charterer’s bank.

 

1.6       OPA/COFR EXPENSES

 

Owneris responsible for periodic (annual or otherwise) OPA expenses.  Charterer is responsible for OPA premiumscharged on a per call basis.

 

**2.**         **Delivery/Redelivery and Trading**

 

2.1       DELIVERY

 

SeeClause 4 (d) of the Shelltime 4 form.

 

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2.2       REDELIVERY

 

SeeClause 4 (d) of the Shelltime 4 form.

 

2.3       TRADING AREAS AND EXCLUSIONS

 

SeeClause 4 of the Shelltime 4 form.

 

### **2.4**      NOTICE OFDELIVERY/REDELIVERY

### ** **

### **.1**             See Clause 5 ofthe Shelltime 4 form.

### ** **

2.5       BUNKERS ON DELIVERY/REDELIVERY

 

Bunkerson delivery to be settled at cost upon Owner’s verification of bunker invoiceof cost of bunkers.  If possible, vesselto be redelivered with approximately the same quantity fuel oil and gas oil tobe settled at cost upon Charterer’s verification of bunker invoice of cost ofbunkers.  In each case, quantities to beno less than 300 mt fuel oil and 50 mt gas oil. Bunker survey to be held at locations of delivery and redelivery unlessotherwise mutually agreed.  Time and costof both surveys to be split 50/50 between Owner and Charterer.  Title of bunkers to pass to Charterer upondelivery and to Owner upon redelivery.

 

2.6       OFF-HIRE PERIOD(S)

 

NotwithstandingClause 21(e) of the Shelltime 4 form, the time charter period may beextended by Charterer for all or any part of the time that the Vessels areoff-hire during the initial term of the charter. Charterer’s option to add backoff-hire time to the time charter period is to be exercised latest 20 daysprior to expiry.

 

2.7       BOYCOTT

 

Inaddition to the circumstances described in Clause 21(a)(ii) of theShelltime 4 form, and subject to Clause 5.11.B, in the event of Vessels aresubject to boycott, are delayed or rendered inoperative by strikes, labor stoppages orany other difficulties arising from their flag, ownership, crew or terms ofemployment of crew or any other vessel under the same ownership, operation orcontrol, such time lost is to be considered as off -hire and all expensesincurred thereby, including fuel consumed during such periods to be for Owner’saccount.  Charterer will not send theVessels to any port or place where the Vessels are known to be boycotted forsuch reasons.

 

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2.8       TRADING WHILE OFF-HIRE

 

Ownermay not under any circumstances trade the Vessels for its own account duringany period of off-hire, unless agreed in advance by Charterer.

 

2.9       DRYDOCKING

 

A.        See clause 22 of the Shelltime 4 form.

 

B.        Emergency Drydocking

 

Shouldemergency drydocking be required, Charterer shall allow the Vessels to proceedto an appropriate port.  Owner shall besolely responsible for gas freeing the Vessels upon such occasion, and alltowing, pilotage, fuel and other expense incurred while proceeding to and fromand while in drydock shall be for Owner’s account.  Fuel used during such drydocking or repair asprovided in this clause or in proceeding to or from the port of drydocking orrepair, will be charged to Owner by Charterer at the price charged to Chartererby its bunker supplier at the last supply port.

 

Incase of emergency drydock pursuant to this clause at a port where the Vesselsare to load, discharge or bunker under Charterer’s orders, hire shall besuspended from the time the Vessels received free pratique on arrival, if inballast, or upon completion of discharge of cargo, if loaded, until the Vesselsare again ready for service.  In case ofdrydocking at a port other than where the Vessels load, discharge, or bunkerunder Charterer’s orders, the following time and bunkers shall be deducted fromhire:  total time and bunkers includingrepair port call from the actual voyage from last port of call under Charterer’sorder to next port of call under Charterer’s orders, less theoretical voyagetime and bunkers for the direct voyage from said last port of call to said nextport of call.  The period during whichhire is suspended including drydocking and repairs until the Vessels again comeon hire under the terms hereof shall count as off-hire under the terms of thisCharter.

 

C.        Cleaning Costs

 

Regardlessof whether the drydocking is a scheduled or emergency drydocking, anyincremental cleaning time and costs to clean for drydocking shall be for theOwner’s account.

 

2.10     LAY-UP

 

Charterershall have the option with Owner’s approval which is not to be unreasonablywithheld, of laying-up the Vessels at a safe place for all or 

 

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anyportion of the term of this Charter in which case hire hereunder shall continueto be paid, but there shall be credited against such hire the whole amountwhich Owner shall save during such period of lay-up through reduction inexpenses, less any extra expenses borne by Owner is put as result of suchlay-up including, but not limited to, crew repatriation expenses and to keepthe Vessels well and properly maintained during such lay-up periods.  All reactivation expenses including but notlimited to crew joining expenses to be for Charterer’s account.  The place of such lay-up shall be subject toOwner’s approval, not to be unreasonably withheld.

 

**3.**         **Vessel Operations, Performance and Warranties**

 

3.1       SPILL PREVENTION

 

Priorto commencement of loading or discharging operations, all overboard lines areto be checked to ensure that they are securely closed.  Pumproom stripping line overboard dischargesshall be suitably blanked off before arriving in port.  These blanks are to be installed and retainedin line through the entire period that the Vessels are in coastal waters.  All other precautions are to be taken toavoid any spillage and/or leakage.  Ifduring loading or discharging operations there is any indication of spillage orleakage of oil or CPP cargo, the Vessels shall immediately cease all pumpingoperations and notify the Owner’s DPA (Dedicated Position Ashore), terminalrepresentative(s) and/or Charterer’s supervisor(s).  The Vessels shall not resume loading ordischarging operations until a thorough investigation is conducted andappropriate remedies are taken, and any time lost shall be for Owner’s account,should such spillage or leakage of oil be found to have occurred due to thenegligence of Vessels’ crew or condition of the Vessels.  Notwithstanding the above, Owner shall alwayscomply with the terms of Clause 4.2.

 

3.2       OILY WASTE

 

TheVessels shall, during tank washing, segregate the tank washings into one cargocompartment and after maximum separation of the free water, discharge the freewater overboard to the extent permitted by applicable internationalregulations.  Thereafter, Charterer shallbe notified of the amount of oil and water in the segregated tankwashings.  On being so notified,Charterer will give instructions for the disposition of the segregated tankwashings and any other cargo oil residues on board (hereinafter collectivelycalled “residues”).  The residues will,at Charterer’s option, be pumped ashore at the loading terminal or retained onboard during the loaded passage.

 

IfCharterer requires that the residues be pumped ashore at the loading port(s),any extra expenses incurred by the Vessels in pumping ashore shall 

 

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befor Charterer’s account.  If the residuesare to be kept on board, the Master shall arrange that the quantity be measuredin conjunction with the cargo suppliers, a note of the quantity shall be madein Vessels’ ullage record and a slop certificate shall be issued.  If Charterer requires that the residues bekept on board, segregated from cargo, they shall, at Charterer’s option, bedischarged at the discharging port(s) in accordance with Charterer’sinstructions.

 

3.3       SPEEDS/CONSUMPTIONS

 

Seeclause 24 of the Shelltime 4 form.

 

3.4       HEATING

 

Norequirements

 

3.5       SHIP TO SHIP TRANSFER

 

Charterershall have the right to perform loading and/or unloading of cargo via ship toship transfers (weather permitting and subject to Master’s approval which notto be unreasonably withheld) at anchor or off any port.  Charterer will provide fenders, hoses and allother equipment necessary to perform the lighterage operations to Master’ssatisfaction.  Owner agrees to allowsupervisory personnel on board, including mooring master, to assist in theperformance of lighterage operations. Any such ship to ship transfer operations shall be conducted inaccordance with the latest edition of OCIMF Ship to Ship Transfer Guide(Petroleum).

 

Fullor partial loading from or discharge to lighters/barges shall not be consideredship to ship transfers.

 

3.6       CARGO MANIFOLDS

 

Ownerwarrants that Vessels shall be equipped with pressure gauges fitted inboard ofthe valve at each discharge manifold connection.  Such gauges shall be maintained in properworking condition and each gauge shall have a valid test certificate.

 

Ownerwarrants that all piping, valves, spools, reducers and other fittingscomprising that portion of Vessels’ manifold system outboard of the last fixedrigid support to the Vessels’ deck and used in the transfer of cargo, bunkersor ballast, will be made of steel or nodular iron which shall comply with themost recent Oil Companies International Marine Forum (“OCIMF”) standards.  The fixed rigid support for the manifoldsystem 

 

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mustbe designed to prevent both lateral and vertical movement of the manifold.

 

Ownerfurther warrants that no more than one reducer or spacer will be used betweenVessels’ manifold valve and the terminal hose or loading arm connection inaccordance with OCIMF Guidelines.  TheVessels shall be equipped to present flanges of 10”, 12” and 16” (ASA) at allmanifold connections on one side of the Vessels.

 

3.7       CRUDE OIL WASH (COW)

 

N/A

 

3.8       INERT GAS SYSTEM

 

N/A

 

3.9       SURVEY AND SAMPLE

 

Charterer’srepresentative may survey and take samples from all Vessel tanks at any time,with cost to be for Charterer’s account.

 

3.10     COMMINGLING/BLENDING

 

Charterershall have the option to commingle and blend different grades of cargo as theyare loaded into the Vessels’ tanks, provided that such commingling and blendingis within the Vessels’ technical capabilities and that the Owner/Masterconsider it safe to do so.  To the extentthat such commingling and blending operations are executed by the Vessels’staff in accordance with the Charterer’s instructions, Owner/Master shall notbe responsible for the quality of cargo resulting from such blendingoperations.

 

3.11     CARGO RETENTION

 

Inthe event that any cargo remains on board upon completion of final discharge,Charterer shall have the right to invoice an amount equal to the CNF port ofdischarge value of such cargo plus freight due with respect thereto providedthat the volume of cargo remaining on board is liquid and pumpable andreachable by Vessels’ fixed equipment (or would have been but for the fault ornegligence of the Owner, Master, Vessel or her crew including non-compliancewith cargo heating requirements as set forth in this charter party and/orvoyage instructions) as determined by a qualified independent inspector.

 

Thefindings of the aforementioned inspector, whether appointed by Charterer, cargoreceiver, cargo Owner, or Owner, shall be binding on both 

 

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parties.  In making the said invoice, Charterer shallcredit Owner for any quantity of cargo onboard immediately prior to the time ofcommencement of loading determined by an independent inspector to have thenbeen liquid and free flowing to the extent that such quantity does not exceedthe total quantity of cargo ROB upon completion of discharge.

 

3.12     LOADING WARRANTY

 

Ownerwarrants that Vessels can routinely load a homogenous cargo at a maximum rateof 36,000 barrels/hour provided two cargo lines are connected (except for startup and topping up operation).

 

3.13     PUMPING PERFORMANCE WARRANTY

 

A.        Owner warrants that Vessels are capable ofdischarging a full cargo in 24 hours (or prorata for part cargo) or maintainingan average pressure of 100 PSI at the Vessels’ manifold throughout the entireperiod of discharge excluding stripping and shore facilities permitting.

 

B.        Charterer is to be compensated at the HourlyRate of Hire for each hour, or pro rata for each part of an hour, that theVessels take in excess of the pumping time allowed per the rates stipulated insub-paragraph (A) hereof.  Inaddition, Charterer reserves the right to order the Vessels from any berth atany time at the Owner’s time and expense when this warranty is breached.  Owner will receive no credit or compensationif the Vessels are able to discharge at a rate greater than those specifiedabove.  If the terminal or place ofdischarging does not allow or permit the Vessels to meet the above warranty,the Master shall forthwith issue a Letter of Protest (for which the Master, ifpossible, shall obtain acknowledgement) to such terminal or place and shallimmediately advise Charterer in writing by telex or facsimile.  If the Master fails to issue the Letter ofProtest, Owner shall be deemed to waive any rights to contest that time waslost as a result of the Vessels’ failure to comply with the above pumpingwarranty.  Any delay to Vessels’discharge caused by shore conditions shall be taken into account in theassessment of pumping performance.

 

3.14     DRAWINGS/DATA

 

The followingdrawings/data shall be submitted to Charterer prior to delivery:

 

a)    GeneralArrangement Plan

b)    CapacityPlan

 

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c)           Mooring Arrangement

d)          Ballast Piping Diagram/ Arrangement

e)           Cargo Piping Diagram/Arrangement

f)           Any other documents or data requested byCharterer

 

Inaddition, the OCIMF questionnaire, Revised Ship Inspection Report (SIRE)Programme of Oil Companies International Marine Forum, for the vessels isdeemed to be fully incorporated into and forms an integral part of this TimeCharter.

 

3.15       REMEASUREMENT

 

Owner to advise allalternative loadlines and corresponding deadweights/drafts available at thetime of charter. Charterer has the option of requesting Owner to arrange forremeasurement of Vessels’ deadweight from time to time.  Owner shall make best endeavors to complywith such request if possible and practical. Charterer shall endeavor to notify Owner well in advance and give atleast three working days notice. All time and expenses in connection with theremeasuring will be borne by Charterer.

 

3.16       ETA

 

Ownerwill instruct Vessel’s Master to advise Charterer of Vessels’ Estimated Time ofArrival (ETAs) at load and discharge ports as instructed by Charterer includingbut not limited to the following:

 

Vesselsshall advise load/discharge port terminal (via Agent) of their ETA at each ofthe following times:

 

1.         Upon leaving last port of call or 96 hoursbefore arrival whichever is less.

2.         48 hours before arrival.

3.         24 hours before arrival.

4.         Any time ETA changes by more than 12 hours.

 

Charterershall not be liable for any proven and documented lost time or additional portexpense with respect to delays in loading and discharging attributable to thefailure of the Vessels to give notice of their ETA in accordance with thisclause or as otherwise reasonably requested by Charterer and such proven anddocumented lost time shall count as off-hire as per Clause 21 (a)(ii).

 

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3.17       CBMMOORING EQUIPMENT

 

Owner warrants that theVessels shall comply with the following requirements throughout the duration ofthis Time Charter, except as noted otherwise below:

 

The Vessels have a minimumof 6 mooring lines or mooring wires mounted on winches as described below.  Each of these mooring lines or wires shallhave a minimum length of 200 meters.  ***Chartererhas the right to supplement the Vessels’ mooring lines as necessary.***

*** ***

Wires/Ropes on winches:

 

Number:  Seven (7) preferred,six (6) acceptable provided they are in the correct location (see below).

 

Length:  Three hundred (300) meter required.  The Vessels are equipped with 250 meters.

*** ***

Material:  Nylonor equivalent ropes are not acceptable. Wire or equivalent synthetic areacceptable.

 

Mounting:  Allwires/ropes must be mounted on their respective winch (see also locationbelow).

 

Certificates:  Allwire/rope certificates must be on board and available for Terminal review uponrequest.

 

Breaking Strength: dependent upon Vessels’ deadweight.

 

Location:  Vessels must be able to run two wires/ropesfrom winches located on main deck forward, two (2) from main deck aft, andthree (3) from the poop deck (two (2) may be acceptable).

 

Pendants:  Vessel-furnished pendants must conform toOCIMF guidelines, i.e., their breaking strength (B.S.) must be equal to onehundred and thirty-seven percent (137%) of B.S. of wires if made of nylon, orone hundred and twenty-five percent (125%) of B.S. of wires if made by othersynthetic fibers.

 

Chocks and Double-HornBitts:  Vessels must have two (2) closedchocks and at least one (1) set of bitts at each mooring location on bothport and starboard side.  Onlydouble-horn bitts are acceptable. Roller-type chocks may be acceptable only if they have been enclosed bywelding a preventive bar on top. Open-type roller chocks are not acceptable.

 

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Winch Brake HoldingCapacity:  Must conform to OCIMF guidelines andmust be set at sixty percent (60%) of the breaking strength of wires/ropes onwinch.

 

Secondary Ropes: A second set of lines will be run to each buoy.  Vessels must have on board a minimum of seven(7) synthetic lines (nylon lines are not acceptable) in good condition,minimum two hundred (200) meters long and of minimum seventy-five (75) metrictons breaking strength.

 

Boom:  Minimum fifteen (15) metric ton safe workingload boom or crane required.  The Vesselsare equipped with5-ton boom.

 

Manifold:  Vessels must be able safely to connect twelve(12) and/or sixteen (16) inch hoses.  Ifreducers are used, all connections/flanges must be within the boundaries of thecontainment area under the manifolds.

 

All delays, losses and expenses due to non-compliancewith this clause will remain solely for Owner’s account.

 

3.18       SEATERMINALS

 

Ownerwarrants that when calling at a sea terminal, the Vessels will maintain theirengines in readiness and will be loaded and discharged in such a manner thatthey are able immediately to shut down cargo operations at any state of loadingor discharging, promptly disconnect hoses, release mooring lines, and proceedto another anchorage or area.

 

3.19       COMMUNICATIONEQUIPMENT

 

Ownerwarrants that Vessels shall be equipped with VHF radiotelephone, satellitecommunications earth station, facsimile machine,  GMS cellular telephone, internet e-mail, andsuch other radio telecommunications equipment as may be required byinternational, flag state, and port state regulations.

 

3.20       INMARSATTRACKING

 

Charterermay employ an Inmarsat C tracking system on the Vessels.  All registration and communication costsrelating to this tracking system will be for Charterer’s account.  Charterer will advise when the system isoperative and confirm termination on redelivery.  Owner to supply the following information:

 

InmarsatC number (9 digits beginning with 4):

Manufacturer,make, etc.:

ModelNumber:

TerminalS/W version, if known:

 

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3.21       MANNING

 

A.        Owner to advise, if so requested, the reliefschedule of Vessels’ senior officers (Master, C/E, C/O and 1/E) and provide toCharterer the CV of each joining officer showing work experience.

 

B.        Charterer requires Master and chief officerto have combined minimum experience of five years in rank (Similar for C/E and1/E).  Exceptions to this requirement maybe discussed on a case by case basis and shall depend on the characteristics ofthe Vessels, their trade and past experience on the same class of Vessels.

 

C.        Owner to endeavor, without guarantee, tomaintain operational continuity on Vessels by maintaining the same seniorofficers in rotation.

 

D.        Should Charterer identify an issue of concernrelating to the crew, Owner is to take corrective action without delay.

 

E.         Vessel’s senior officers shall be fluent(written and spoken) in English.

 

3.22       OWNERSHIP/FLAG

 

Ownerundertakes that the Vessels will not change management, flag or be sold orotherwise disposed of during the currency of this charter without priorapproval of Charterer, not to be unreasonably withheld.

 

**4.****      ****Eligibility and Compliance**

** **

4.1         APPROVALS

 

A.        To the best of Owner’s knowledge at the timeof delivery, the Vessels will be acceptable to Sunoco throughout the term ofthis charter

 

B.        Owner will endeavor to maintain all necessaryoil company approvals during the course of this charter.  Should the Vessels not be approved by anynecessary oil company, the Owner will undertake at the earliest opportunity toadopt all reasonable corrective measures at Owner’s time and expense and obtainthe required approvals, provided, however, that Charterer tradesthe Vessel to ports and/or areas where the aforesaid oil companies can inspectthem if inspection is required to reinstate their oil company approval.  If the Owner is unable to obtain the approvalof the concerned oil company as a result of the continued unacceptability ofthe Vessels, after inspection and not as a result of inability or want toinspect by the oil company, and as a consequence, the oil company and theCharterer having proved that despite its best efforts it is unable to find 

 

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alternativeemployment for the Vessels, Charterer shall have the right to put them off hirefor the actual time lost until alternative employment of no worse value thanthat originally identified is found.

 

### **.2**         C.        Should Charterer requireother approvals, sufficient time and notice is to be given to Owner who willthen arrange for Vessels’ inspection at Charterer’s own expense.  Failure to obtain approvals shall giveCharterer the right to put the Vessels off hire, and costs to make good thedeficiencies will be for the Owner’s account.

### ** **

4.2         ELIGIBILITY

 

Subjectto Clause 5.11.B, Owner warrants that the Vessels are in all respects eligibleunder applicable conventions, laws and regulations for trading to the ports andplaces specified in Clause 4 and Clause 2.3, and that they shall have on boardfor inspection by the appropriate authorities all certificates, records,compliance letters, contingency plans and other documents required for suchservice including, but not limited to, ISM Safety Management Certificate, ISMDocument of Compliance, and Certificates of Financial Responsibility for OilPollution.  Owner further warrants thatthe Vessels do, and will, fully comply with all applicable conventions, laws,regulations and ordinances of any international, national, state or localgovernment entity having jurisdiction. In particular, Owner warrants that for trading to or from ports in theUnited States, the Vessels do and will comply with all requirements of theFederal Oil Pollution Act of 1990 (OPA 90), US Federal Water Pollution ControlAct, SOLAS IX (ISM), MARPOL 1973/1978/1983, Civil Liability Convention andregulations issued pursuant thereto and effective during the term of thischarter party.  Any delays, losses,expenses or damages arising as a result of failure to comply with this clauseshall be for Owner’s account and, where applicable, shall count as off-hiretime per Clause 21.  In the interest ofsafety, Owner recommends that the Master observe the recommendations as totraffic separation and routing which are issued from time to time by theInternational Maritime Organization (IMO) as promulgated by the state of theflag of the Vessels or the state in which the effective management of Vesselsis exercised.

 

4.3         I.T.F.

 

Ownerwarrants that the officers and crew are employed under an agreement recognizedand approved by the ITF and will remain so throughout the currency of thisCharter Party.  In the event that theVessels are subject to boycott by ITF or any other body, or delayed or renderedinoperative by strikes, labor stoppages/slowdowns or any other difficulties arisingfrom their flag, ownership, crew or terms of employment of other

 

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crewof the same ownership, operations or control, such time lost is to beconsidered as off-hire and all expenses incurred thereby, including fuelconsumed during such period to be for Owner’s account.

 

4.4         DRUGAND ALCOHOL POLICY

 

Ownerwarrants that it has a policy on Drug and Alcohol Abuse (“Policy”) applicableto the Vessels which meets or exceeds the standards in the OCIMF Guidelines forthe Control of Drugs and Alcohol Onboard Ship. Under the Policy, alcohol impairment shall be defined as a blood alcoholcontent of 40 mg/100 ml or greater: the appropriate seafarers to be testedshall be the Vessels’ officers and crew and the drug/alcohol testing andscreening shall include unannounced testing in addition to routine medicalexaminations.  An objective of the policyshould be that the frequency of the unannounced testing be adequate to act asan effective abuse deterrent and that officers and crew be tested at least oncea year through a combined program of unannounced testing and routine medicalexaminations.  Owner further warrantsthat the Policy will remain in effect during the term of this Charter and thatOwner shall exercise due diligence to ensure that the Policy is followed.  It is understood that an actual impairment,or any test finding of impairment, shall not in and of itself mean Owner hasfailed to exercise due diligence. Persons who test positive, refuse to test, or are unfit for duty(impaired because of drug or alcohol use) shall be removed from the Vessels andshall not be reassigned to them or to any other vessel on charter to Chartereror its affiliates.

 

4.5       SOLAS/MARPOL

 

N/A

 

4.6         ITOPF

 

Owner warrants that it is a member of theInternational Tanker Owner’s Pollution Federation (“ITOPF”) and that Owner willretain such membership during the term of this Charter.  Owner further warrants that the Vessels shallbe in full compliance with the 1992 Civil Liability Convention (CLC) and the1992 Fund Convention during the term of this Charter.

 

**5.****      ****Legal Provisions**

** **

5.1         LAW AND LITIGATION

 

Anyand all disputes arising out of or relating to this contract shall bearbitrated in the City of New York before a board of three persons, 

 

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consistingof one arbitrator to be appointed by the Owner, one arbitrator by theCharterer, and one by the two so chosen who will act in the capacity asprocedural chairman.  Their decision orthat of any two of them shall be final and binding, and for the purpose ofenforcing the award, this agreement and the award may be made a rule ofthe court.  Either party may call forsuch arbitration by service upon the other, wherever it may be found, in theform of a written notice specifying the nature of the claim and the name andcontact details of their appointed arbitrator. If the other party shall not, by written notice served on the firstmoving party within 20 days of the service of such first notice, appoint itsarbitrator to arbitrate the disputes or differences specified, then the firstmoving party shall have the right without further notice to appoint a secondarbitrator with precisely the same force and effect as if said secondarbitrator had been appointed by the other party.  Awards by the panel, or a majority thereof,may include costs and reasonable attorneys fees.  The arbitration proceedings shall beconducted in accordance with the rules of the Society of MaritimeArbitrators, Inc. and the applicable law will be the Federal Maritime Lawof the United States.

 

5.2         AFFILIATES’ CLAIMS

 

A.        If, whether directly or indirectly, anybreach of this charter by Owner shall cause any company or companies which, atthe date of this charter, is or are associated with and/or affiliated toCharterer to suffer any loss or damage whatsoever or incur any liabilitywhatsoever to any third party, Owner shall be liable to Charterer to the fullextent of Charterers’ Affiliates’ or Associates’ losses and/or damages and/orliabilities including those arising under any bill of lading issued under thisCharter and Charterer shall be entitled to claim in respect thereof inaccordance with the Arbitration Clause of this charter.  Charterer warrants that any sums actuallyrecovered by it in respect of its Affiliates’ or Associates’ losses and/ordamages and/or liabilities shall be received by it for the account of suchAffiliates and/or Associates, in reduction and/or mitigation of their loss.

 

B.        If a Bill of Lading issued under this charteris negotiated or assigned to Charterer, all claims asserted by Chartereragainst Owner under the Bill of Lading shall be subject to arbitration inaccordance with the terms of the Arbitration Clause of the charter.

 

5.3         ASSIGNMENT

 

Charterermay sub-charter or assign this charter to any individual or company, butCharterer shall always remain responsible for the due 

 

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fulfillmentof this Charter.  Unless Chartererprovides its express written consent, not to be unreasonably withheld, Ownermay not assign this Charter or its obligations hereunder and any suchassignment will be void.

 

5.4         TENDER OF NOTICE

 

Anynotice due under this charter shall be sent on open CC format by each authorizedparty via fax or email as below or as otherwise instructed by the parties.

 

For Owner: OSG 300 LLC and OSG Liberty LLC

Fax: 212-251-1180

Email: PPopov@OSG.Com

 

ForCharterer: OSP 300 LLC

Fax:813-221-2649

Email:Fgordon@OSG.com

 

5.5         INSURANCE

 

Ownerwarrants that from the time the obligation to proceed to the loading port(s) andthroughout the Vessels’ service under this Charter Party, they shall be insuredat Owner’s expense for:

 

·      Hull and Machinery Insurance including collision liability with a limitequal to or greater than Owner’s yearly declared value of the Vessels. Suchinsurance to waive all rights of subrogation against Charterer to the extent ofthe liabilities and/or indemnity obligations assumed by Owner under thisCharter.

 

·      Protection and Indemnity Insurance on a full entry basis with anInternational Group P&I Club.  Suchinsurance shall include, but not be limited to: coverage for injuries to ordeath of masters, mates and crew; collision liabilities not insured under theH&M policy, excess collision liabilities, cargo legal liabilities andpollution liabilities.  The limit of suchinsurance shall be as established by the rules of the International Groupof P&I Clubs except for pollution liabilities which shall be limited to themaximum pollution limit offered through the P&I Clubs of the InternationalGroup (currently US $1 billion).

 

·      Hull and P&I war risk insurance with a limit of not less than theOwner’s yearly declared value of the Vessels. Such insurance to waive allrights of subrogation against Charterer to the extent of the liabilities and/orindemnity obligations assumed by Owner under this Charter.

 

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Any additional, per voyage,Hull and Machinery or Protection and Indemnity, War Risk insurance premiums orrequired crew bonuses, which are specifically applicable to a particular portor location to which the Charterer directs the Vessels shall be for Charterer’saccount (provided always that Charterer is given notice of the amount of suchadditional premiums prior to the Vessels entering the area to which theadditional coverage and premiums apply, and that the benefit of all discountson such premiums received by Owner from its War Risks insurers, underwriters orbrokers are credited to Charterer in full and that Owner obtains from itsinsurers waivers of subrogation against Charterer in respect of any claims byOwner under its war risk insurance arising out of compliance with suchorders).  Charterer shall reimburse Ownerany amounts due under this Clause upon receipt of Owner’s invoice together withfull supporting documentation including all associated debit and credit notes.

 

If so requested byCharterer, Owner shall promptly furnish to the Charterer proper evidence ofsuch insurance.  This warranty is to beregarded as an essential part of this Charter Party, which is conditional onits truth or performance, so that its breach entitles Charterer, at its option,to terminate the Charter Party and/or to recover any damages allowable.  Such insurance shall be maintained in fullforce and effect for the duration of this Charter Party.

 

5.6         WAR

 

This clause reprints BIMCO CONWARTIME 93 except for strikeouts ofsubclause (d)(i),(ii) and (e) which are addressed by clause 5.5.

 

(a)   For thepurpose of this clause, the words:

 

(i)              “Owner”shall include the ship Owner, bareboat charterer, disponent Owner, managers orother operators who are charged with the management of the Vessel, and theMaster; and

 

(ii)             “WarRisks” shall include any war (whether actual or threatened), act of war, civilwar, hostilities, revolution, rebellion, civil commotion, warlike operations,the laying of mines (whether actual or reported), acts of piracy, acts ofterrorists, acts of hostility or malicious damage, blockades (whether imposedagainst all Vessels or imposed selectively against Vessels of certain flags orOwnership, or against certain cargoes or crews or otherwise howsoever), by anyperson, body, terrorist or political group, or the Government of any statewhatsoever, which, in the reasonable judgment of the Master and/or the Owner,may be dangerous or are likely to be or to become dangerous to Vessel, hercargo, crew or other persons on board the Vessel.

 

(b)   The Vessels,unless the written consent of the Owner be first obtained, 

 

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shallnot be ordered to or required to continue to or through, any port, place, areaor zone (whether of land or sea), or any waterway or canal, where it appearsthat Vessels, their cargo, crew or other persons on board them l, in thereasonable judgment of the Master and/or the Owner, may be, or are likely tobe, exposed to War Risks.  Should theVessels be within any such place as aforesaid, which only becomes dangerous, oris likely to be or to become dangerous, after her entry into it, they shall beat liberty to leave it.

 

(c)   The Vesselsshall not be required to load contraband cargo, or to pass through anyblockade, whether such blockade be imposed on all Vessels, or is imposedselectively in any way whatsoever against Vessels of certain flags orOwnership, or against certain cargoes or crews or otherwise howsoever, or toproceed to an area where they shall be subject, or is likely to be subject to abelligerent’s right of search and/or confiscation.

 

(f)          TheVessels shall have liberty:-

 
| (i)    | To  comply with all orders, directions, recommendations or advice as to  departure, arrival, routes, sailing in convoy, ports of call, stoppages,  destinations, discharge of cargo, delivery, or in any other way whatsoever,  which are given by the Government of the Nation under whose flag the Vessels  sail, or other Government to whose laws the Owner is subject, or any other  Government, or any other body or group whatsoever acting with the power to  compel compliance with their orders or directions; |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| (ii)   | To  comply with the order, directions or recommendations of any war risks  underwriters who have the authority to give the same under the terms of the  war risks insurance;                                                                                                                                                                                                                                                                                                                                             |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| (iii)  | To  comply with the terms of any resolution of the Security Council of the United  Nations, any directives of the European Community, the effective orders of  any other Supranational body which has the right to issue and give the same,  and with national laws aimed at enforcing the same to which the Owner are  subject, and to obey the orders and directions of those who are charged with  their enforcement;                                                                                                 |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| (iv)   | To  divert and discharge at any other port a cargo or part thereof which may  render the Vessels liable to confiscation as a contraband carrier;                                                                                                                                                                                                                                                                                                                                                                         |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| (v)    | To  divert and call at any other port to change the crew or any part thereof or  other persons on board the Vessels when there is reason to believe that they  may be subject to internment, imprisonment or other sanctions.                                                                                                                                                                                                                                                                                            |

 

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(g)         If in accordance with their rights under the foregoing provisions ofthis clause, the Owner shall refuse to proceed to the loading or dischargingports, or any one or more of them, they shall immediately inform theCharterer.  No cargo shall be dischargedat any alternative port without first giving the Charterer notice of the Owner’sintention to do so and requesting them to nominate a safe port for suchdischarge.  Failing such nomination by theCharterer within 48 hours of the receipt of such notice and request, the Ownermay discharge the cargo at any safe port of their own choice.

 

(h)         If in compliance with any of the provisions of subclauses (b) to (f) ofthis Clause anything is done or not done, such shall not be deemed a deviation,but shall be considered as due fulfillment of this Charter.

 

5.7       BILL(S) OF LADING/INDEMNITY

 

***The discharge port(s) shown in the original Bill ofLading shall not constitute a declaration of discharge port(s) andCharterer shall have the right to order the Vessels to any port(s) withinthe terms of this Charter Party.***

*** ***

***IfCharterer requests Owner to deliver cargo at a discharge port or place:***

*** ***

***(1)******  ******Without prior presentation to the Vessels at the dischargeport or place of one of the original Bills of Lading issued for the cargo, dulyendorsed, and/or***

*** ***

***(2)******  ******At a discharge port or place other than that specificallynamed in said Bills of Lading,***

*** ***

***Chartererhereby indemnifies Owner, without further invocation, against claims brought byholders of original Bills of Lading against Owner in accordance with Owner’sletter of indemnity wording from Owner’s P&I Club which must be member ofthe International Group of P&I Clubs. Owner and Charterer agree that any requirement contained in the abovereferenced “letter of indemnity” wording for a bank guarantee is herebywaived.  For consistency, letter ofindemnity choice of law and dispute resolution procedure is deemed to be asprovided under this charterparty Clause 5.1***

*** ***

***5.8******      ******C***ONFIDENTIALITY

*** ***

Theterms and conditions of this Time Charter shall remain private andconfidential.

 

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5.9       LOSS OFVESSEL

 

Shouldthe Vessels be lost, or be missing and presumed lost, hire shall cease at thetime of her loss, or if such time is unknown, at the time when the Vessels werelast heard from. If the Vessels should become a Constructive Total Loss (“CTL”),hire shall cease at the time of the casualty resulting in such loss.  In either case, any hire paid in advance andnot earned shall be returned to Charterer. If the Vessels should be missing when a payment of hire would otherwisebe due, such payment shall be postponed until the safety of the Vessels areascertained.  If the Vessels should becomea CTL, Charterer shall have the option to cancel this Charter on written noticeto Owner.  The Vessels shall be deemed aCTL under this Charter when the cost of recovering and repairing them isreasonably estimated to exceed their value when repaired, without taking intoconsideration any value of this Charter.

 

5.10     CONFLICTSOF INTEREST

 

Nodirector, employee or agent of Owner shall give or receive any commission, fee,rebate, gift or entertainment of significant cost or value in connection withthis Charter Party (other than brokerage commissions and other commissions andfees described in this Charter Party), or enter into any other businessarrangement with any director, employee or agent of Charterer or any of itsaffiliates without prior written notification to Charterer.  Any representative(s) authorized byCharterer may audit any and all records of Owner for the sole purpose ofdetermining whether there has been compliance with this clause.

 

5.11     CONTRACTINTERPRETATION

 

A.        The headings of these clauses are insertedfor convenience of reference and shall be ignored in the interpretation andconstruction of this Charter.  In theevent of any conflict between these rider clauses and Shelltime 4 provisions,these rider clauses shall take precedence. This Time Charter agreement constitutes the entire agreement among theparties and supercedes any earlier agreements and discussions.  Any amendments to this Time Charter must bein writing from authorized persons.

 

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