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Vela
Tanker Voyage Charter Party
VELAVOY2005

PREAMBLE

IT IS THIS DAY AGREED between Owner/Chartered Owner

(hereinafter called "Owner") of the , Flag MS/SS.
(hereinafter called "Vessel"), and (hereinafter called "Charterer")
that the transportation herein provided for shall be performed subject to the terms and conditions of this Charter, which
includes this Preamble and Part I and Part II. In the event of a conflict, the provisions of Part I shall prevail over those
contained in Part II to the extent of such conflict.

PARTI

(A) VESSEL DESCRIPTION AND POSITION:

IMO No.: Year built: Classed:

Summer Deadweight: metric tons on meters/feet draft in salt water on assigned
summer freeboard.
Maximum Cargo Capacity: metric tons % more or less Vessel's option.
Cubic capacity for cargo (at 98%): . cubic meters/cubic feet/barrels.
Length overall: meters/feet. Beam: meters/feet.
Tons per centimeter (TPC) immersion:
Capacity of segregated ballast tanks (SBT): cubic meters
SBT capacity as % of summer dead weight:
Gross Registered Tons (GRT):
Can Vessel load cargo and discharge clean ballast simultaneously? Yes No
Suez Canal Net Tonnage (SCNT):
Specify amount of clean ballast normally carried for loading port arrival: cubic meters

Number of Cargo tanks:

Cargo tanks Coated: _Yes _No Type: _
Cargo tanks Coiled: Yes No Material:

Last Cargo: Next to last cargo:

Vessel location on date of Charter:
Expected ready to load:
Base speed: knots laden, weather and safe navigation permitting.
Maximum speed: knots laden, weather and safe navigation permitting.
Hull insured value:
Owner warrants Vessel's position at time of fixture is and that Vessel is proceeding at knots.

(B) LAYDAYS: Commencing: Cancelling:

(C) LOADING RANGE(S)/PORT(S)/PLACE(S):

(D) DISCHARGING RANGE(S)/PORT(S)/PLACE(S):

 (E) CARGO QUANTITY:

Full Cargo as defined in Part II, Clause 1 subject to the Maximum Cargo Capacity limits specified in Part (A):

Yes No

or

Part Cargo Minimum metric tons with Charterer's option to load up to Full Cargo as described
in this Paragraph (E); provided Part Cargo Minimum or cargo sufficient to fill the cubic capacity of Vessel's available
cargo spaces is supplied by Charterer, no deadfreight shall be payable by Charterer under Part II, Clause 7, whether
option is exercised or not.

(F) CARGO DESCRIPTION:

(G) FREIGHT RATE:

Freight rate for Full Cargo or Part Cargo Minimum

(hereinafter called "Base Freight Rate"):
Freight rate for quantity above Part Cargo Minimum
(hereinafter called "Overage Freight Rate"):_
Percentage points per knot increase in Freight Rate for speed increases:
as described in Part II, Clause 37.

(H) STORAGE RATE PER DAY: United States Dollars

(I) BILLING:

Freight, deadfreight, demurrage and any other monies payable to Owner pursuant to
this Charter shall be payable in United States Dollars and invoiced to Charterer
at:
^m^ and paid to Owner at:

(J) LAYTIME: Total Laytime in running hours:_

(K) DEMURRAGE/DEVIATION PER DAY:

In accordance with Part II, Clause 8, demurrage and/or deviation per day shall be based on:
Summer Deadweight of metrictons; or
Part Cargo Minimum plus metric tons;
totalling metric tons;
or United States dollars

(L) LAW:

The construction, validity and performance of this Charter shall be governed by English
Law. Arbitration shall take place and General Average shall be adjusted and settled in London.
 (M) INCORPORATED CLAUSE(S):

The following specified Clause(s), the text(s) of which are attached hereto shall be
deemed incorporated in and made a part of this Part I.

r
IN WITNESS WHEREOF, the parties have caused this Charter, consisting of a Preamble, Parts I and II,to be executed in
duplicate.

Owner

By: Title:

Charterer

By: Title:
 VELAVOY2005

PART II

1. DEFINITIONS. In this Charter 1

(a) "Place" shall mean any berth, dock, anchorage, sea terminal, submarine line, alongside vessel and/or 2
lighter, whether at anchor or underway, and/or any other place to which Charterer is entitled to order Vessel 3
hereunder. 4

(b) "ILL Convention" shall mean the International Load Line Convention, 1966, or any amendment thereof as 5
may be applicable to the voyage(s) to be performed hereunder. 6

(c) "Full Cargo" shall mean a cargo which fills Vessel to its minimum freeboard, as permitted by the ILL 7
Convention, or fills the cubic capacity of Vessel's available cargo spaces, whichever occurs first, after 8
leaving appropriate space in the tanks for the expansion of cargo. 9

(d) "Arrival in Berth" shall mean the completion of mooring of Vessel when loading or discharging at a sea 10
terminal, Vessel being all fast when loading from or discharging alongside a wharf/berth, or Vessel being all 11
fast alongside a barge, lighter or other vessel when loading from or discharging to a barge, lighter or other 12
/^ vessel. 13

2. VESSEL 14

(a) DESCRIPTION/CONDITION. Owner warrants that, from the time when the obligation to proceed to the 15
loading port(s) or place(s) and throughout Vessel's service under this Charter, Vessel shall be as described in 16
Part I (A). Owner further warrants that during the period just described, Owner shall exercise due diligence to 17
ensure that Vessel and its hull, machinery, boilers, all tanks and all other equipment including, but not limited 18
to pipes, pumps, valves, inert gas and crude oil wash systems, navigational equipment, heating coils and 19
facilities, shall be fully functional and in good working order and condition and in every way seaworthy and fit 20
to carry the cargo and perform the voyage(s) required under this Charter. 21

(b) COMPLEMENT. Owner warrants that, during the period described in Paragraph (a) of this Clause, Vessel 22
shall have a full and efficient complement of Master, officers and crew, with adequate training and experience 23
in operating all Vessel's equipment including, but not limited to, inert gas and crude oil wash systems, and 24
that Master and all officers shall possess valid and current certification/documents issued or approved by the 25
country of Vessel's registry. Owner further warrants the conversational English language proficiency of 26
Master and officer(s) in charge of cargo and bunker oil handling. 27

(c) COMPLIANCE. Owner warrants that Vessel shall, during the periods described in Clause 1 of the Charter, be 28
in full compliance with all international conventions, all applicable laws, regulations and/or other requirements 29
of the country of Vessel's registry and of the countries or states of the port(s) and/or place(s) to which Vessel 30
may be ordered hereunder and all applicable regulations and/or requirements of any terminals or facilities in 31
such port(s) and/or place(s) where Vessel shall load or discharge. Owner further warrants that Vessel shall 32
be fully classed and have on board during the subject period, all certificates, records or other documents 33
c required by the aforementioned conventions, laws, regulations and/or requirements. The conventions, laws, 34
regulations and requirements referred to in this Clause shall mean conventions, laws, regulations and 35
requirements concerning ship size, ship design, safety, operation of ship's equipment (including inert gas and 36
crude oil washing systems, where applicable), navigation, pollution and other like matters. Owner further 37
warrants that, if required by Charterer or the Vessel's trade, the Vessel will hold a valid ITF Certificate 38
throughout the period of this Charter. 39

(d) BREACH. If any of the warranties stipulated in this Clause are breached, any delay resulting therefrom shall 40
not count as lay time or, if Vessel is on demurrage, as time on demurrage and any expense attributable to 41
such delay shall be for Owner's account. 42
43
(e) SALE. Owner warrants that the Vessel has not been sold at the time that this Charter is entered into and, in 44
the event that a contract of sale is entered into during the period of this Charter, Owner will give Charterer 45
seven (7) working days notice of the proposed date of delivery to the purchasers thereunder. 46

3. CLEANING 47

Owner shall clean the tanks, pipes and pumps of Vessel at Owner's expense to the satisfaction of Charterer's 48
representative(s). If the cargo specified in Part I (F) is clean product and inspection of the tanks is required, 49
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Owner shall gas free the tanks as necessary. Any time used for tank inspection and any re-inerting of Vessel shall 50
count as laytime or, if Vessel is on demurrage, as time on demurrage. Any time required for cleaning and gas 51
freeing shall not count as laytime or, if Vessel is on demurrage, as time on demurrage. Compliance with this 52
Clause shall not be deemed compliance with Owner's obligations under Clause 2, which are in no way lessened 53
by this Clause. 54

4. VOYAGE(S) 55

(a) Vessel shall proceed with utmost dispatch to any port(s) or place(s) as ordered by Charterer in accordance 56
with Part I (C) and there load cargo as specified in Part I (E) and (F). On completion of loading, Vessel shall 57
then forthwith proceed to any port(s) or place(s) as ordered by Charterer in accordance with Part I (D) and 58
there deliver said cargo. Except when required by reason of the negligence or fault of Owner or the Vessel, 59
lightering or discharge at sea or within port limits shall be at Charterer's expense. 60

(b) Owner shall transmit promptly Charterer's voyage instructions in their entirety to Vessel. The laden voyage 61
shall be performed at the Base Speed stipulated in Part I (A) or, if no speed is there indicated, at full service 62
speed. 63

5. MAXIMUM CARGO 64

In no event shall Charterer be required to provide, nor shall Vessel load a cargo quantity in excess of a Full Cargo 65
as defined in Paragraph (c) of Clause 1, irrespective of whether a Full Cargo as defined is less than that provided 66
in Part 1 (E) hereof. In addition, Charterer shall not be required to provide a cargo quantity in excess of the 67
maximum cargo specified in Part I (A). All time lost and expense incurred by reason of Vessel loading a quantity 68
of cargo which puts Vessel, at any stage of the voyage(s) hereunder, below the marks permissible under the ILL 69
Convention, shall be for Owner's sole account. 70

6. FREIGHT 71

(a) PAYMENT. Freight shall be paid at the rate stipulated in Part I (G) and shall be computed on gross quantity 72
as stated on the Bill of Lading and on quantity of documented tank washings if freight thereon is payable in 73
accordance with Paragraph (d) of Clause 33; provided, however, that no freight shall be payable on any 74
quantity of cargo which puts Vessel, at any stage of the voyage(s) hereunder, below the marks permissible 75
under the ILL Convention. Dead freight shall be paid in accordance with Clause 7. Provided that Owner's 76
invoice is received before completion of final discharge, payment of freight shall be made by Charterer without 77
discount within seven (7) Charterer working days after completion of discharge of cargo at last discharging 78
port or place, less any deductions under Clause 6(b) and Clause 45 and any disbursements made to Master 79
or Owner's agent(s) at port(s) or place(s) of loading and/or discharging, plus the cost of insurance, 80
commissions and expenses on said disbursements and any other costs incurred by Charterer on Owner's 81
behalf pursuant to this Charter. Freight shall be invoiced and paid in accordance with Part I (I). 82

(b) CARGO RETENTION 83

(I) If on completion of final discharge an independent cargo inspector selected and hired by the shipper on 84
behalf of Charterer and cargo receivers) determines that liquid cargo in excess of 0.01% of the total Bill 85
of Lading quantities loaded onto the Vessel remains on board, Charterer shall have the right to deduct 86
from freight an amount equal to the FOB loading port value of the portion of such liquid cargo that 87
exceeds 0.01% of the total Bill of Lading quantities, plus cargo insurance and freight thereon. For the 88
purpose of calculating this deduction, the grade of such excess liquid cargo shall be deemed to be the 89
grade of the final crude parcel discharged by the Vessel. 90

(ii) Prior to the beginning of cargo loading, Charterer shall advise Owner in writing of the list of inspection 91
companies from which the independent cargo inspector who will perform the ROB inspection shall be 92
selected and hired by the shipper. If, prior to the completion of cargo loading, Owner notifies Charterer 93
that it wishes to participate in the aforesaid ROB inspection, the independent cargo inspector shall be 94
selected from this list by the shipper and Owner jointly and hired by the shipper. In such event, the costs 95
of the inspection shall be shared equally by the shipper and Owner. 96

(iii) Any action or lack of action under this Clause 6 (b) shall be without prejudice to any other rights or 97
obligations of the parties, but any exercise of the right of deduction hereunder by Charterer shall be 98
conclusive and not merely by way of security. 99

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(iv) Charterer shall indemnify Owner against any liability to third parties resulting from non-delivery of any 100
such cargo in respect of which a deduction from freight is made under this Clause 6 (b), provided that 101
Charterer shall under no circumstances be liable to indemnify Owner in an amount greater than the 102
amount of freight so deducted. 103

(c) WORLDSCALE. Unless otherwise stipulated herein, all rates, hours, terms and conditions in the Worldwide 104
Tanker Nominal Freight Scale current on the date of the commencement of loading (hereinafter called 105
"WORLDSCALE") shall apply to this Charter. In the event that WORLDSCALE is replaced by a successor 106
system, such new system shall apply to the Charter. 107

7. DEADFREIGHT 108

(a) PAYMENT. Should the entire cargo quantity specified in Part I (E) not be supplied, Master shall give 109
immediate notice to Charterer by telegraph, telex, fax or radio that such cargo quantity has not been 110
furnished, indicating shortage, and shall then await Charterer's instructions. Should Charterer fail to provide 111
further cargo, Vessel, upon request of Charterer, shall then proceed on its voyage provided that the tanks in 112
which the cargo is loaded are sufficiently filled to put it in a seaworthy condition. If any delay is caused to 113
Vessel by reason of Master waiting for Charterer's instructions as aforesaid, such delay shall count as laytime 114
or, if Vessel is on demurrage, as time on demurrage and any expense incurred to Vessel attributable solely to 115
such delay shall be for Charterer's account. Deadfreight shall be paid at the Base Freight Rate on the 116
shortage (being the difference between the cargo quantity specified in Part I (E) and the quantity loaded as 117
shown on the Bills of Lading) provided such deadfreight charge is fully documented by cable advice from 118
Master or by deadfreight certificate. 119

(b) Deadfreight shall not be paid on unused capacity for any cargo or slop tank(s) nominated for loading provided 120
that an independent cargo surveyor has determined before loading that said tank(s) contain (I) water volumes 121
exceeding ten percent of capacity or (ii) residues or material known to cause contamination or deterioration in 122
the quality of oil to be loaded. Charterer shall have the right to refuse payment of deadfreight for the cases 123
stated above if Owner's Sailing Advice to Charterer has inaccurately stated the quality or on-board quantities 124
of oil or water before arrival at port of loading or excessive water was retained on-board during vessel's 125
deballasting at port of loading thereby affecting Charterer's nominated volumes for loading. 126

8. DEMURRAGE/DEVIATION RATE 127

The rate for demurrage and/or deviation shall be the fixed dollar figure specified in Part I (K) or the rate derived by 128
determining the applicable rate from the WORLDSCALE Demurrage Table for tonnage specified in Part I (K) and 129
multiplying that rate by the Base Freight Rate. If a Part Cargo Minimum basis is specified in Part I (E) and 130
Charterer exercises its option to load additional cargo, any demurrage and/or deviation shall, nevertheless, remain 131
payable at the aforesaid fixed dollar rate or at the aforesaid rate based on the tonnage specified in Part I (K), 132
whichever is applicable. The applicable rate under this Clause shall hereinafter be called "Demurrage Rate" or 133
"Deviation Rate" as is appropriate. 134

9. LOADING AND DISCHARGING PORT(S) 135

(a) Charterer shall nominate loading or discharging port(s) and/or place(s) or order Vessel to a destination for 136
orders. If Vessel is ordered to a destination for orders, Charterer shall thereafter nominate loading or 137
discharging port(s) and/or place(s). All such nominations or orders shall be made in sufficient time to avoid 138
delay to Vessel. 139

(b) After nominating loading and/or discharging port(s) or place(s) pursuant to Paragraph (a) of this Clause, 140
Charterer may nominate new port(s) or place(s), whether or not they are within the range of the previously 141
nominated port(s) and/or place(s) and/or vary the rotation of any nominated port(s) or place(s), and Owner 142
shall issue instructions necessary to make such change(s). It is understood and agreed, however, that the 143
aforesaid option to nominate new loading port(s) or place(s) in different ranges shall lapse on Vessel 144
tendering Notice of Readiness at a nominated loading port or place and that the aforesaid option to nominate 145
new discharging port(s) or place(s) in different ranges shall lapse on Vessel tendering Notice of Readiness at 146
a nominated discharging port or place. If a change to, or varying the rotation of nominated port(s) or place(s) 147
occurs or if Vessel is sent to a destination for orders, any time by which the steaming time to the port(s) or 148
place(s) to which Vessel is finally ordered exceeds that which would have been taken if Vessel had been 149
ordered to proceed to such port(s) or place(s) in the first instance shall be compensated at the Deviation Rate 150
per running day and pro rata for a part thereof. AH steaming times shall be computed using BP Distance 151

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Tables and Base Speed, unless Vessel has increased speed pursuant to Charterer's orders. In addition, 152
Charterer shall pay for extra bunkers consumed during such excess time at Owner's documented actual 153
replacement cost at the port where bunkers are next taken. 154

(c) Discharging port(s) or place(s) shown in Bills of Lading do not constitute a declaration of discharging port(s) 155
or place(s), but any order of Vessel to a destination for orders, all nominations and any re-nominations 156
pursuant to this Clause shall be consistent with Part I (C) and (D). 157

10. ETA 158

(a) Unless Master is otherwise instructed in writing by Charterer, the following Estimated Time of Arrival (ETA) 159
notifications shall be given. As soon as commencing the voyage to the nominated loading port(s) or place(s), 160
Master shall advise Charterer and Vessel's agent, and any other entity designated by Charterer, of Vessel's 161
estimated date and time of arrival at the nominated loading port(s) or place(s). Further, regardless of the 162
length of the voyage and even if Vessel is in port discharging on the previous voyage, Master shall confirm or 163
amend such advice, ninety six (96), seventy-two (72), forty-eight (48) and twenty-four (24) hours prior to 164
Vessel's arrival at the loading port(s) or place(s). On leaving the final loading port or place, Master shall 165
advise Charterer and Vessel's agent and any other entity designated by Charterer of Vessel's estimated date 166
and hour of arrival at the nominated discharging port(s) or place(s). On voyages in excess of seven (7) days 167
in duration, ETA notifications shall be sent at noon every Sunday and Thursday throughout the voyage. 168
Further, provided the length of the voyage permits, Master shall confirm or amend such advice seventy-two 169
(72), forty-eight (48) and twenty-four (24) hours priorto Vessel's arrival at the discharging port(s) or place(s). 170
In addition, on leaving the final loading port or place, Master shall advise Charterer of expected maximum, 171
draft at arrival and, provided the length of the voyage permits, shall confirm or amend such advice no later 172
than seventy-two (72) hours prior to Vessel's arrival at the discharging port(s) or place(s). 173

(b) An alteration of more than three (3) hours in the twenty-four (24) hour notice or an alteration of more than 174
twelve (12) hours in any other advice given pursuant to Paragraph (a) of this Clause shall be advised by 175
Master immediately to Charterer and Vessel's agent, and any other entity designated by Charterer. 176

(c) If, for any reason, Vessel is unable to trim to even keel for arrival at the discharging port(s) or place(s), Master 177
shall give notice of this to Charterer as soon as possible after receiving loading instructions but no later than 178
sailing from the final loading port or place. Such notice shall include Vessel's estimated arrival draft forward 179
and aft. 180

(d) If Master fails to comply with the requirements of Paragraphs (a), (b) and/or (c) of this Clause, any delay 181
resulting therefrom at loading and/or discharging port(s) or place(s) shall not count as laytime or, if Vessel is 182
on demurrage, as time on demurrage. 183

(e) At each loading and discharging port or place, Master or Vessel's agent shall promptly notify Charterer of the 184
dates and times the following events occurred: 185

Notice of Readiness to load/discharge tendered 186

All fast 187
Hoses connected 188
Hoses disconnected 189
Vessel sailed 190
Any unusual occurrences or delays whether caused by Vessel or cargo loading or receiving facilities, 191
including notice(s) of protest with reason(s). 192

(0 All advices and notifications required by this Clause shall be made by telegraph, telex, fax or radio, (if radio, 193
subsequently confirmed in writing). 194
195
11. NOTICE OF READINESS 196

Upon arrival at customary anchorage or waiting place at each loading and discharging port or place, Master or 197
Vessel's agent shall give Charterer or its representative Notice of Readiness ("NOR") by letter, telegraph, telex, 198
fax, radio or telephone (if radio or telephone, subsequently confirmed promptly in writing) that Vessel is in all 199
respects ready to load or discharge cargo, berth or no berth. However, NOR shall not be tendered prior to the 200
Commencing Date/Time specified in Part l(B) unless requested by Charterer. When berthing operations are 201
allowed only during daylight, NOR shall be tendered only between official sunrise and sunset. Where delay is 202
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caused to Vessel getting into berth after tendering NOR for any reason over which Charterer has no control, such 203
delay shall not count as laytime or, ifVessel is on demurrage, as time on demurrage. 204

12. CANCELLATION OF CHARTER 205

Should Vessel not be ready to load by 1200 hours local time on the Cancelling Date specified in Part I (B), 206
Charterer shall have the option of cancelling this Charter. If it appears that Vessel will be delayed beyond the 207
Cancelling Date specified in Part I (B), Owner may notify Charterer of the date on which he expects Vessel to be 208
ready to load, asking Charterer whether it will exercise its option to cancel and the option must then be declared 209
by Charterer, within forty-eight (48) hours, Sundays and Holidays excepted, of the receipt of the said notification 210
from Owner. In the event of Owner giving such notification and Charterer not exercising his option to cancel within 211
the stated period, the third day after the readiness date stated in Owner's notification, or such other day as may be 212
mutually agreed shall be the new Cancelling Date for the purpose of this Clause. Cancellation or failure to cancel 213
shall be entirely without prejudice to any claim for damages Charterer may have for Vessel not being ready to load 214
by the original Cancelling Date specified in Part I (B). 215

13. LAYTIME/DEMURRAGE 216

(a) COMMENCEMENT/RESUMPTION. Laytime or time on demurrage as herein provided, shall commence or 217
resume upon the expiration of six (6) hours after tender to Charterer or its representative of NOR or upon 218
Vessel's Arrival in Berth, whichever occurs first. Charterer shall have the benefit of this six (6) hours NOR 219
time at each load and discharge port, whether or not Vessel is on demurrage. Laytime shall not commence 220
before 1200 hours local time on the Commencing Date specified in Part I (B) unless Charterer shall otherwise 221
agree in writing. Should Charterer so agree in writing, laytime shall commence upon Vessel's Arrival in Berth 222
and the total laytime agreed under Part I (J) shall be increased by the amount of time spent by the Vessel 223
after Arrival in Berth but before 1200 hours local time on the Commencing Date specified in Part I (B). 224

(b) DURATION. The laytime specified in Part I (J) shall be allowed free of expense to Charterer for the purpose 225
of loading and discharging cargo and all other Charterer's purposes. Laytime or, if Vessel is on demurrage, 226
time on demurrage, shall continue until all cargo hoses have been disconnected upon the final termination of 227
the loading or discharging operation. Disconnection of all cargo hoses shall be promptly effected. IfVessel is 228
delayed in excess of two (2) hours after such disconnection of cargo hoses solely for Charterer's purposes, 229
laytime or, if Vessel is on demurrage, time on demurrage shall resume upon the expiration of the said two (2) 230
hour period and shall continue from that point until the termination of such delay. 231

(c) PAYMENT. Charterer shall pay demurrage per running day and pro rata for a part thereof for all time by 232
which the allowed laytime specified in Part I (J) is exceeded by the time taken for loading and discharging and 233
for all other Charterer's purposes and which, under this Charter, counts as laytime or as time on demurrage. 234

14. LAYTIME/DEMURRAGE CONSEQUENCES 235

(a) SPECIFIED. Any delay to Vessel due to unavailability of berth, unavailability of cargo, or solely for 236
Charterer's or terminal's purposes, after the expiration of six (6) hours from Charterer's receipt of NOR before 237
Arrival in Berth or any delay to Vessel after Arrival in Berth, shall count as laytime or, if Vessel is on 238
demurrage, as time on demurrage. If demurrage is incurred due to fire, explosion or strike, lockout or 239
stoppage of labor or breakdown of machinery or equipment in or about the installation, facility, terminal or 240
plant of Charterer, supplier, shipper or consignee of the cargo or weather and/or sea conditions (regardless of 241
whether the Vessel was on demurrage when such cause(s) or condition(s) arose), such demurrage shall be 242
paid at one-half (!4) of the Demurrage Rate. The latter is so even if any other condition(s) hereinbefore 243
described in this Paragraph (a) coincide with the period of such cause(s) or condition(s) and irrespective of 244
any option given in Part I (C) and (D). 245

(b) EXCLUSIONS. Notwithstanding the provisions of any other Paragraph of this Clause or any other Clause of 246
this Charter to the contrary, time shall not count as laytime or, if Vessel is on demurrage, as time on 247
demurrage, if such time is spent or lost: 248

(i) As a result of labor dispute, strike, go slow, work to rule, lockout, stoppage or restraint of labor involving 249
Master, officers or crew of Vessel or tugboats or pilots. 250

(ii) Except if Vessel is discharged at sea, on an inward passage including, but not limited to, awaiting 251
daylight, tide, tugs or pilot, and moving from an anchorage or other waiting place, even if discharging has 252
taken place at the anchorage or other waiting place, until Vessel's Arrival in Berth. 253

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(iii) Due to cargo or bunker tank overflow, discharge of contaminated ballast water overboard, breakdown, 254
inefficiency, repairs or any other conditions whatsoever attributable to inability to load or discharge the 255
cargo withinthe time allowed and/or failure to meet Vessel warranties stipulated in this Charter. 256

(iv) Due to Owner or port authority prohibiting loading or discharging. 257

(v) By reason of local law, regulations or intervention by local authorities, with the exception of port closure 258
due to weather and/or sea conditions or security related delays pursuant to Clause 43(c). 259

(vi) In ballasting or deballasting (from the time loading/discharge is stopped until the time loading/discharge is 260
resumed), lining up, cleaning of tanks, pumps, pipelines, bunkering or for any other purposes of Vessel 261
only, unless same is carried out concurrently such that no loss of loading and/or discharging time is 262
involved and, in the case of bunkering operations during discharge, such operations are conducted with 263
the advance written permission of Charterer or Charterer's authorized agent. 264

(vii) Due to an escape or discharge of oil or pollutantor the threat of an escape or discharge of oil or pollutant 265
from Vessel. 266

(c) UNSPECIFIED. Any delays for which laytime/demurrage consequences are not specifically allocated in this 267
or any other Clause of this Charter and which are beyond the reasonable control of Owner or Charterer shall 268
count as laytime or, if Vessel is on demurrage, as time on demurrage. If demurrage is incurred on account of 269
such delays, such demurrage shall be paid at one-half (!/2) the Demurrage Rate. 270

15. DISCHARGE AT SEA 271

(a) Except when required by reason of fault attributable to Vessel, any full or partial discharge at sea or at a place 272
outside a port including a place outside a port designated as a transshipment area by WORLDSCALE, shall 273
be at the expense of Charterer and, notwithstanding Clause 11, Paragraph (a) of Clause 13 and Paragraph 274
(a) of Clause 14, time used for such full or partial discharge at sea shall count as laytime or as time on 275
demurrage subject to the bad weather provisions Paragraph (a) of Clause 14, as follows: 276

If Vessel is fully or partially discharged at sea or at a place outside a port, laytime or, if Vessel is on 277
demurrage, time on demurrage shall commence upon the expiration of six (6) hours after Vessel gives Notice 278
of Readiness at the discharge site designated by Charterer or when Vessel is all fast alongside the first cargo 279
receiving vessel, whichever occurs first, and shall end when disconnection of the cargo hoses from the last 280
cargo receiving vessel has been completed. 281
282
(b) If Vessel is fully discharged at sea, or at a transshipment area, freight payment shall, in the absence of 283
agreement as to the appropriate freight rate, be based on the freight rate stipulated in Part I (G) multiplied by 284
a flat rate which is published by or obtained from the Worldscale Association (London) Limited or the 285
Worldscale Association (NYC) Inc. If Vessel is discharged in part at sea, or at a transshipment area, the 286
place at sea or the transshipment area shall not constitute a port or place additional to those specified in Part 287
I (D) and the freight rate for the voyage shall be the same as if the partial discharge had not taken place. 288
Charterer, however, shall reimburse Owner for any time by which the steaming time to the final discharging 289
port or place exceeds that which, at the Base Speed specified in Part I (A), would have been taken if Vessel 290
had not partially discharged at sea at the Deviation Rate per day or pro-rata for a part thereof. In addition, 291
Charterer shall pay for extra bunkers consumed by Vessel during such excess time at Owner's documented 292
actual replacement cost at the port where bunkers are next taken. In calculating the payment for extra 293
bunkers consumed, allowance shall be given for the daily bunker consumption used in determining the 294
Demurrage Rate for the standard vessel in WORLDSCALE. 295

(c) If Vessel is partially or fully discharged at sea as aforesaid, Charterer shall exercise due diligence to ensure 296
that no damage is caused to Vessel. Such operations shall conform to standards set out in the latest 297
published edition of the ICS/OCIMF Ship to Ship Transfer Guide (Petroleum) and Owner undertakes that 298
Vessel and her crew will comply with such standards. 299

16. LOADING/DISCHARGING PORT/PLACE 300

(a) BERTHING. Vessel shall not be required to berth where the maximum draft of Vessel is greater than the 301
depth of water at low tide. In such cases, Charterer undertakes to discharge sufficient cargo into vessels 302
and/or lighters within port limits to enable Vessel to safely reach and lie at berth always afloat. 303
VELAVOY2005

(b) SAFE LOCATION(S). Charterer shall exercise due diligence to orderVessel to port(s) or place(s) which are 304
safe for Vessel and where it can lie always safely afloat. Notwithstanding anything contained in this or any 305
other Clause in this Charter to the contrary, Charterer does not warrant the safety of any such port(s) or 306
place(s) and shall not be responsible for any loss, damage, injury or delay resulting from any unsafe condition 307
at such port(s) or place(s) unless caused by Charterer's failure to exercise due diligence as aforesaid. The 308
term "safe" as used in Part I (C) and (D) shall be construed to be consistent with Charterer's obligations as 309
set forth in this Paragraph (b). 310

(c) SHIFTING. Charterer shall have the right to shiftVessel within any port of loading and/or discharging from 311
one loading or discharging place to another such place once or more often. In the event that Charterer 312
exercises this right, Charterer shall pay all additional expenses properly incurred. Time spent shifting shall 313
count as laytime or, if Vessel is on demurrage, as time on demurrage. For purposes of freight payment, the 314
places grouped in port and terminal combinations in WORLDSCALE are to be considered as berths within a 315
single port, with Charterer paying shiftingexpenses in accordance with the foregoing. 316
(d) OFF BERTH. Charterer or terminal operator shall have the right to shift Vessel from a loading and/or 317
discharging place if Vessel fails to meet the pumping and/or heating warranties stipulated in Clauses 18 and 318
25 or if Vessel fails to comply with or meet any published port regulations such as propeller immersion rules 319
at Ras Tanura, so as to avoid delay to other vessels waiting to use such place. Charterer or terminal operator 320
shall also have the right to shift Vessel from a loading and/or discharging place due to an unsafe condition of 321
Vessel. In such situation(s), Charterer shall not be obliged to provide an alternative loading or discharging 322
place to the place from which Vessel was shifted. However, Charterer shall exercise due diligence to arrange 323
prompt reberthing and commencement of loading or discharging once Vessel has corrected such 324
deficiency(ies). All expenses related to this shifting and any reberthing shall be for Owner's account and all 325
time lost by reason of the foregoing shall not count as laytime or, if Vessel is on demurrage, as time on 326
demurrage. 327

17. CARGO MEASUREMENT 328

(a) Prior to loading, Master shall measure the on board quantities of oil, water and sediment residues which are 329
segregated in all holding tanks and slop tanks and those which remain in cargo tanks and, if requested, shall 330
advise suppliers) and Charterer of such quantities. After loading, Master shall determine the cargo quantities 331
loaded, expressing these cargo quantities in barrels at standard temperature (60°F/15°C), using calculations 332
as specified in the Manual of Petroleum Measurement Standards issued by the American Petroleum Institute 333
or similar standards in effect at the port of loading. A written tank-by-tank ullage report containing all 334
measurements of oil, water and sediment residues on board prior to loading and quantities of cargo loaded 335
shall be prepared and promptly submitted by Master to Charterer. All time spent for the measurement of on 336
board quantities prior to loading and after loading as aforesaid shall not count as laytime or, if Vessel is on 337
demurrage, as time on demurrage. 338

(b) If Master's calculations of cargo loaded (on board quantities of oil, water, and sediment residues excluded), 339
after applying the Vessel's Experience Factor, show a deficiency in the total cargo or any single grade or 340
grades from the Bill of Lading figures in excess of 0.1% Master shall, if investigation and recalculation verify 341
such deficiency, issue a Letter of Protest to supplier(s) (which should, if practicable, be acknowledged) and 342
shall advise Charterer of such deficiency immediately by telegraph, telex, fax or radio and thereafter shall 343
send a copy of the Letter of Protest to Charterer. 344

(c) Prior to discharging, Master shall measure the quantity of each grade of cargo on board, expressing these 345
quantities in barrels at standard temperature (60°F/15°C) using the same calculation procedures specified in 346
Paragraph (a) of this Clause. Before and after discharging, Master shall cooperate with shore staff to 347
ascertain discharged quantities. Vessel shall be obliged to discharge all free-flowing and pumpable oil and, if 348
ordered by Charterer, any free-flowing and pumpable residues of oil, water and sediment. 349

(d) An inspector may be employed by Charterer at its expense to verify quantities and qualities of cargo and 350
residues on board Vessel at both loading and discharging port(s) and/or place(s). Owner warrants that 351
Vessel is equipped with an Inert Gas System in working order and has officers and crew experienced in its 352
use. Depressurization of tanks to permit ullage measurements shall be performed in accordance with the 353
provisions of the most recent Inert Gas Systems for Oil Tankers publication issued by the International 354
Maritime Organization (IMO). Any time used solely for such inspections and/or measurements shall count as 355
laytime or, if Vessel is on demurrage, as time on demurrage. 356

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18. PUMPING IN AND OUT 357

(a) Hoses for loading and discharging shall be furnished by Charterer and shall be connected and disconnected 358
by Charterer or by Owner, at Charterer's option. When Vessel loads and/or discharges at sea terminal(s), 359
Vessel shall be properly equipped, at Owner's expense for operations at such terminal(s), including suitable 360
anchors, ground tackle, mooring lines and equipment for handling submarine hoses. Vessel shall also be 361
properly equipped with a sufficient number of cargo manifold reducing pieces of steel or comparable material 362
(excluding aluminum and gray cast iron) which meet the most recent Oil Companies International Marine 363
Forum (OCIMF) standards, to make available appropriate flanges for cargo hoses/arms at all manifold 364
connections on one side of Vessel. If Vessel is not properly equipped as required in this Paragraph (a), any 365
time thereby lost shall not count as laytime or, if Vessel is on demurrage, as time on demurrage. 366

(b) The cargo shall be pumped into Vessel at the expense and risk of Charterer only up to Vessel's permanent 367
hose connections. Vessel shall provide all necessary pumps, power and hands required on board for 368
mooring and unmooring, connecting and disconnecting of hoses, and loading and discharging. If requested 369
by Charterer, Vessel shall load and/or discharge more than one grade simultaneously if Vessel is technically 370
capable of doing so. 371

(c) Owner warrants that Vessel shall arrive at the loading port(s) and/or place(s) with cargo tanks properly inerted 372
and that such tanks shall so remain inerted throughout the loading of the cargo, the voyage and the 373
subsequent discharging of the cargo. In case of an Inert Gas System failure during loading and/or 374
discharging, cargo operations shall be suspended immediately until the system becomes fully operational, 375
any deficiency in inerting is fully corrected and the terminal (or other loading and/or discharging facility) has 376
given permission to resume operations. Time used from cessation to resumption of cargo operations shall 377
not count as laytime or, if Vessel is on demurrage, as time on demurrage. Master may be requested by 378
terminal personnel or independent inspectors to breach the IGS for purposes of gauging, sampling, 379
temperature determination and/or determining the quantity of cargo remaining on board after discharge. 380
Master shall comply with these requests consistent with the safe operation of Vessel. Any time lost due to 381
non-compliance with these instructions shall not count as laytime or, if Vessel is on demurrage, as time on 382
demurrage. 383

(d) If required by Charterer, Vessel, after discharging, shall clear shore pipelines of cargo by pumping water 384
through them and the time thereby consumed shall count as laytime or, if Vessel is on demurrage, as time on 385
demurrage. 386

(e) All overtime incurred by officers and crew in loading and/or discharging shall be for the account of Owner. 387

(0 (i) LOADING. Vessel shall load cargo at an average rate of at least 70,000 barrels per hour. If Vessel 388
cannot load cargo at an average rate of at least 70,000 barrels per hour, or if loading is restricted to a 389
lower specified rate on request of Master, then the resulting increase in loading time shall be added to 390
allowed laytime. 391

(ii) DISCHARGE AT A PORT/TERMINAL. Owner warrants that Vessel shall discharge entire cargo within 392
twenty-four (24) hours pumping time or pro-rata on actual quantity discharged if more than one port or 393
berth is involved, or shall maintain an average pressure at Vessel's manifold ("Average Manifold 394
Pressure") calculated in accordance with Clause 18(f)(iii), during the entire period of discharge as 395
specified below, provided receiving facilities permit: 396

Vessel KDWT Average Manifold Pressure 397

per part 1(A) PSI 398

Less than 60 100 399

60-160 125 400
Greater than 160 150 401
402
Where the terminal requires a reduced pumping rate below the warranted rate during any period or 403
periods of discharge totaling in excess of 6 hours, the foregoing pumping warranty shall be deemed to 404
have been met and all pumping time shall count as laytime, or if the Vessel is on demurrage, as time on 405
demurrage, less any Crude Oil Washing time that exceeds Clause 18(g) allowances. 406

(iii) CALCULATION OF AVERAGE MANIFOLD PRESSURE. Average Manifold Pressure under the 407
preceding clause is equal to the sum of the hourly manifold pressure readings (taken as close to the start 408
 VELAVOY2005

of the hour as possible and excluding all pressure readingstaken during periods of Allowed Deductions) 409
for the entire period of discharge, divided by a numberequal to the sum of the total discharge time minus 410
total Allowed Deductions. 411

Allowed Deductions include: 412

1) 15 minutes for start-up of pumps. 413

2) 3 hours for stripping. 414
3) Any slowdown or stoppage for terminal purposes totaling less than 6 hours, plus 30 minutes per 415
occurrence for slowdown, stopping and bringing up or restarting pumps. 416

All time lost as a result of Vessel being unable to meet either the 24-hour pumping warranty or the 417
Average Manifold Pressure warranty in Clause 18(f)(ii) shall not count as laytime or, if Vessel is on 418
demurrage, as time on demurrage. If the discharging Port/Terminal does not allow or permit Vessel to 419
meet the above warranty, the Vessel's Master shall forthwith issue a Letter of Protest (which should, if 420
practicable be acknowledged) to such Port/Terminal and immediately advise Charterer by fax, telegraph 421
or telex. If the Master fails to issue a Letter of Protest and advise Charterer as aforesaid, Owner shall be 422
deemed to have waived any rights to contest that time was lost as a result of Vessel's failure to comply 423
with the above pumping warranty. Any pumping time lost solely due to the discharging Port/Terminal 424
imposing restrictions on discharging pressure below the applicable figure warranted and which is properly 425
documented and reported as aforesaid shall count as laytime or, if the Vessel is on demurrage, as time 426
on demurrage. 427

(iv) SHIP TO SHIP TRANSFER (LIGHTERING) OPERATIONS. Owner warrants that Vessel shall discharge 428
each nominated cargo parcel within 16 hours total pumping time. All pumping time in excess of 16 hours 429
shall not count as laytime or, if Vessel is on demurrage, as time on demurrage, unless such excess 430
pumping time was caused solely by restrictions on the receiving vessel. 431
432
(g) Owner warrants that the Vessel is equipped with a Crude Oil Washing System in working order and has 433
officers and crew experienced and certified in its use. If Vessel is required by law or requested by Charterer 434
to Crude Oil Wash, the Vessel shall be allowed 6 hours or prorata part thereof (calculated based upon the 435
number of tanks washed/stripped divided by the total number of cargo tanks loaded), which shall be counted 436
as laytime if the Vessel is on laytime, or as demurrage if the Vessel is on demurrage. Crude Oil Washing 437
may be done concurrently with discharge at Owner's option, but will not count as an Allowed Deduction under 438
Clause 18(f)(ii). Nothing in this clause shall be construed to limit or otherwise affect Owner's obligations to 439
comply withthe Pumping Warranties contained in Clauses 18(f)(1), 18(f)(H) and 18(f)(iii). IfCrude Oil Washing 440
cannot be accomplished for any reason attributable to the fault of Vessel, including improper operation of the 441
inert gas system, any measurable cargo remaining on board as determined by an independent inspector shall 442
be deemed liquid and pumpable and Charterer shall have the right to deduct from freight an amount equal to 443
the FOB loading port value of such cargo plus freight due with respect thereto. 444
ms^ 19. BACKLOADING 445

Charterer shall have the option of loading Vessel with a part cargo at any discharging port or place to which 446
Vessel may have been ordered, provided that such part cargo is as described in Part I (F) and is compatible with 447
cargo then on board. Owner shall discharge such part cargo at any other discharging port(s) or place(s) 448
previously nominated, provided such port(s) or place(s) lie within the rotation of the discharging ports or places 449
previously nominated. If this option is exercised, additional time consumed awaiting berth and/or cargo and/or 450
tank preparation and/or loading and discharging such part cargo shall count as laytime or, if Vessel is on 451
demurrage, as time on demurrage. Any additional expenses, including port charges, incurred as a sole result of 452
loading and discharging such part cargo shall be for Charterer's account. 453

20. DUES, TAXES AND OTHER CHARGES 454

Unless otherwise specified in WORLDSCALE and to the extent not prohibited by law, dues, taxes and other 455
charges upon Vessel (including those assessed on the quantity of cargo loaded or discharged or on the freight) 456
shall be paid by Owner and dues, taxes and other charges on the cargo shall be paid by Charterer. Vessel shall 457
be free of charges for the use of any port(s) or place(s) arranged by Charterer solely for the purpose of loading or 458
discharging cargo. However, Owner shall be responsible for charges for any such port(s) or place(s) when used 459
solely for Vessel's purposes, such as, but not limited to, awaiting Owner's orders, tank cleaning, repairs, before, 460
during or after loading and/or discharging. 461

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21. ICE 462

(a) DURING VOYAGE. In case a nominated port or place of loading or discharging should be inaccessible due 463
to ice, Master shall immediately notify Charterer by telegraph, telex or radio, requesting revised orders and 464
Vessel shall remain safely outside the ice-bound area. Charterer shall give orders for another port or place 465
which is free from ice and where there are the facilities for the loading or discharging of the cargo in bulk. In 466
this event, freight shall be paid at the rate stipulated in Part I (G) to such alternative port or place and any time 467
by which the steaming time to such port or place exceeds that which would have been taken if Vessel had 468
been ordered to proceed to such port or place in the first instance shall be compensated at the Deviation Rate 469
per running day and pro-rata thereof. In addition, Charterer shall pay for extra bunkers consumed during 470
such excess time at Owner's documented actual replacement cost for such bunkers at the port where 471
bunkers are next taken. 472

(b) AT PORT. If, on or after Vessel's arrival at the loading or discharging port or place, it is dangerous to remain 473
at such port or place for fear of Vessel being frozen-in or damaged, Master shall notify Charterer who shall 474
give orders for Vessel either to proceed to another port or place where there is no danger of ice and where 475
there are facilities for loading or discharging of the cargo in bulk or to remain at such original port or place at 476
Charterer's risk. If Vessel is ordered to proceed to another port or place, the sum in respect of freight and 477
delay to be paid by Charterer shall be as stipulated in Paragraph (a) of this Clause. If Vessel remains at such 478
original port or place, any time so lost on account of ice shall count as laytime or, if Vessel is on demurrage, 479
as time on demurrage. 480

22. DRY CARGO 481

Charterer has the option of shipping packaged and/or general cargo (including oils and bitumen in drums) in the 482
available dry cargo space. Freight shall be payable on such cargo in accordance with Clause 6 at the Base 483
Freight Rate and Charterer shall pay, in addition, all expenses, including port dues, incurred solely as a result of 484
the packaged and/or general cargo being carried. The time used loading and discharging such dry cargo shall 485
count as laytime or, if Vessel is on demurrage, as time on demurrage, but only to the extent that such time is not 486
concurrent with time used loading and/or discharging the oil cargo. 487

23. QUARANTINE 488

Time lost at any port or place due to quarantine shall not count as laytime or, if Vessel is on demurrage, as time 489
on demurrage unless such quarantine was in force at the time when such port or place was nominated by 490
Charterer. Vessel shall obtain free pratique prior to arrival at any port provided that same is allowed by the 491
relevant authorities. Time spent in obtaining free pratique and/or customs clearance after arrival in port shall not 492
count as laytime or, if Vessel is on demurrage, as time on demurrage. 493

24. INSPECTION 494

(a) OPERATIONS. Charterer's representative(s) shall have the right at loading and/or discharging port(s) or 495
r place(s) to inspect Vessel and observe operations. Owner shall instruct Master to give every assistance so 496
as to enable said representative(s) to properly observe operations throughout Vessel. Vessel shall also 497
provide suitable officer accommodation to said representative(s) if required. 498

(b) BUNKER SAMPLING. Charterer's representative(s) shall have the right to survey and take samples of all 499
Vessel's bunker tanks and non-cargo spaces. Refusal by Master to permit such bunker surveying and 500
sampling shall give Charterer or terminal operator the right to order Vessel off berth. All time lost by reason of 501
such refusal, including any time used in shifting Vessel off and back to berth, shall not count as laytime or, if 502
Vessel is on demurrage, as time on demurrage. Further, all expenses related to such refusal, including 503
Vessel shifting expenses, shall be for Owner's account. Any delay to Vessel caused solely by bunker 504
surveying and sampling shall count as laytime or, if Vessel is on demurrage, as time on demurrage. 505

25. HEAT 506

IfVessel is described as coiled in Part I (A), Owner warrants that Vessel is capable of heating the cargo up to and 507
maintaining it at a maximum temperature of 135°F/57°C. However, unless otherwise requested by Charterer, 508
Vessel shall be required only to maintain the cargo at the temperature loaded (up to a maximum of 135°F/57°C) 509
throughout the voyage and the entire discharge. If requested by Charterer and if the length of the voyage allows, 510
Vessel shall increase and maintain the temperature of the cargo from the loaded temperature to a temperature 511
specified by Charterer, up to a maximum of 135°F/57°C and Charterer shall pay for extra bunkers consumed 512

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solely in increasing the temperature as aforesaid at Owner's documented actual replacement cost for such 513
bunkers at the port where bunkers are next taken. If Vessel fails to maintain the loaded temperature or to 514
increase and maintain the temperature of the cargo, as requested by Charterer, Charterer shall have the option to 515
hold Vessel off berth and/or to suspend discharging, all until the cargo is properly heated, all time and expense in 516
connection with the foregoing being for Owner's account. 517

26. INSURANCE 518

(a) Owner warrants that for the duration of this Charter, Vessel will have Protection and Indemnity ("P&l") 519
insurance providing equivalent cover to that provided by a full owner's entry, without exclusions, in a member 520
club of the International Group of P&l Clubs with a limit of liability of not less than USD 1 billion, excluding 521
pollution risks, and hull insurance for the current market value of Vessel. If the Vessel's hull is self-insured, 522
full collision liability insurance shall be included in Owner's P&l insurance coverage. Any extra insurance 523
premiums incurred by reason of the Vessel's age or condition, whether for cargo insurance or otherwise, shall 524
also be for Owner's account and Charterer shall have the right to deduct the cost of such insurance from 525
freight. 526

/^^\ (b) Owner warrants that it has in place a worldwide insurance cover for oil pollution with limits and terms of not 527
less than the maximum on offer through the International Group of P&l Clubs and that this cover will remain in 528
place throughout the period of this Charter. 529

(c) During the period of this Charter, Owner shall not change the P&l Club in which the Vessel is entered without 530
the express written consent of Charterer and shall upon request provide Charterer with written evidence of 531
such coverage in a form satisfactory to Charterer. 532

27. BILLS OF LADING 533

(a) Bills of Lading shall be signed by Master or his authorized agent as presented. However, at Charterer's 534
option, Charterer or its agents may sign Bills of Lading on behalf of Master. All Bills of Lading shall be without 535
prejudice to this Charter and Charterer shall indemnify Owner against all consequences or liabilities which 536
may arise from any inconsistency between this Charter and any Bills of Lading or other documents signed by 537
Charterer or its agents or by Master at their request or which may arise from any irregularity in papers 538
supplied by Charterer or its agents. 539

(b) Notwithstanding anything in this Charter to the contrary, the carriage of cargo under this Charter and under all 540
Bills of Lading issued for the cargo shall be subject to the statutory provisions and other terms set forth or 541
specified in sub-paragraphs (I) through (vi) of this Paragraph (b) and such terms shall be incorporated 542
verbatim or be deemed incorporated by reference in any such Bill of Lading. In such sub-paragraphs and in 543
any Act referred to therein, the word "Carrier" shall include Owner and Chartered Owner of Vessel. 544

(i) CLAUSE PARAMOUNT. This Bill of Lading shall have effect subject to the provisions of the Carriage of 545
Goods by Sea Act 1971 and to the Rules contained in the Schedule thereto (the HagueA/isby Rules), 546
except that if this Bill of Lading is issued at a place where any other act, ordinance or legislation gives 547
statutory effect to the International Convention for the Unification of certain Rules relating to Bills of 548
Lading at Brussels, August 1924, then this Bill of Lading shall have effect subject to the provisions of 549
such act, ordinance or legislation. The applicable act, ordinance or legislation (hereinafter called "Act") 550
shall be deemed to be incorporated herein and nothing herein contained shall be deemed a surrender by 551
the Carrier of any of its rights or immunities or an increase of any of its responsibilities or liabilities under 552
the Act. If any term of this Bill of Lading be repugnant to the Act to any extent, such term shall be void to 553
that extent but no further. 554

(ii) NEW JASON CLAUSE. In the event of accident, danger, damage, or disaster before or after the 555
commencement of the voyage resulting from any cause whatsoever, whether due to negligence or not, or 556
which, or for the consequences of which, the Carrier is not responsible, by statute, contract or otherwise, 557
the cargo shippers, consignees or owners of the cargo shall contribute with the Carrier in General 558
Average to the payment of any sacrifices, losses or expenses of a General Average nature that may be 559
made or incurred and shall pay salvage and special charges incurred in respect of the cargo. If a salving 560
ship is owned or operated by the Carrier, salvage shall be paid for as fully as if the said salving ship or 561
ships belonged to strangers. Such deposit as the Carrier or his Agents may deem sufficient to cover the 562
estimated contribution of the cargo and any salvage and special charges thereon shall, if required, be 563
made by the cargo shippers, consignees or owners of the cargo to the Carrier before delivery. 564

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(iii) GENERAL AVERAGE. General Average shall be adjusted, stated and settled according to York/Antwerp 565
Rules 1994, and, as to matters not provided for by those Rules, according to the laws and usages at the 566
place specified in Part I (L) (except that any payment made by Carrier to Charterer or to a Government or 567
to others for "pollution damage" as defined in Article I, Clause 6 (a) of the 1992 Protocols to the CLC and 568
any amendment thereto, shall not be deemed to be General Average sacrifices or expenditures). If a 569
General Average statement is required, it shall be prepared by an Adjuster from the place specified in 570
Part I (L) appointed by the Carrier and approved by Charterer of Vessel. Such Adjuster shall attend to 571
the settlement and the collection of the General Average, subject to customary charges. General 572
Average Agreements and/or security shall be furnished by Carrier and/or Charterer, and/or Owner and/or 573
consignee of cargo, if requested. Any cash deposit being made as security to pay General Average 574
and/or salvage shall be remitted to the Average Adjuster and shall be held by the Adjuster at the 575
Adjuster's risk in a special account in a duly authorized and licensed bank at the place where the General 576
Average statement is prepared. 577

(iv) BOTH TO BLAME. If Vessel comes into collision with another ship as a result of the negligence of the 578
other ship and any act, neglect or default of Master, mariner, pilot or the servants of the Carrier in the 579
navigation or in the management of Vessel, the owners of the cargo carried hereunder shall indemnify 580
the Carrier against all loss or liability to the other or non-carrying ship or its owners insofar as such loss 581
r or liability represents loss of or damage to or any claim whatsoever of the owners of said cargo, paid or 582
payable by the other or recovered by the other or non-carrying ship or its owners as part of their claim 583
against the carrying ship or Carrier. The foregoing provisions shall also apply where the owners, 584
operators or those in charge of any ships or objects other than, or in addition to, the colliding ships or 585
objects are at fault in respect of a collision or contact. 586

(v) LIMITATION OF LIABILITY. Any provision of this Charter to the contrary notwithstanding, the Carrier 587
shall have the benefit of all limitations of, and exemptions from liability accorded to owner or chartered 588
owner of Vessel by any statute or rule of law for the time being in effect. 589

(vi) DEVIATION. Vessel shall have liberty to sail with or without pilots, to tow or be towed, to go to the 590
assistance of vessels in distress, to deviate for the purpose of saving life or property or of landing any ill 591
or injured person on board, and to call for fuel at any port or ports in or out of the regular course of the 592
voyage. 593

28. WAR 594

(a) No contraband of war shall be shipped, but petroleum and/or its products shall not be deemed contraband of 595
war for the purposes of this Clause. Vessel shall not, however, be required without the consent of Owner, 596
which shall not be unreasonably withheld, to enter any port, place, or zone which is involved in a state of war, 597
warlike operations or hostilities, civil strife or piracy, whether there be a declaration of war or not, where it 598
might reasonably be expected to be subject to capture, seizure or arrest, or to a hostile act by belligerent 599
power (the term "power" meaning any de jure or de facto authority or any other purported governmental 600
organization maintaining naval, military or air forces). 601

(b) For purposes of this Clause it shall be unreasonable for Owner to withhold consent to any voyage, route, or 602
port or place of loading or discharging if insurance against all risks defined in Paragraph (a) of this Clause is 603
then available commercially or under a government program in respect of such voyage, route or port/place of 604
loading or discharging. If such consent is given by Owner, Charterer shall pay any provable additional cost of 605
insuring Vessel against hull and machinery war risks, excluding blocking and trapping, over and above such 606
costs in effect on the date of this Charter in an amount equal to the insured value stipulated in its ordinary 607
marine policy as of the date of this Charter. If such insurance is not obtainable commercially or through a 608
government program, Vessel shall not be required to enter or remain at any such port, place or zone and in 609
such case, Charterer shall have the right to order Vessel to load or discharge, as the case may be, at any 610
other port(s) or place(s) consistent with Part I (C) and (D). 611

(c) Charterer shall have the option to procure the hull war risk insurance specified in Paragraph (b) of this 612
Clause, subject to Owner's prior approval of underwriters and the terms and conditions of the coverage, which 613
approval shall not be unreasonably withheld. Such option shall be declared at least seventy-two (72) hours 614
prior to Vessel's entry into the excluded zone. If such option is exercised, Charterer shall provide verification 615
of the insurance placement prior to Vessel's entry into the excluded zone. For that time period during which 616
Charterer has procured such insurance, Charterer shall be entitled to deduct from freight an amount equal to 617
the cost of such insurance in effect on the date of this Charter. 618

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29. EXCEPTIONS 619

(a) Vessel, Master and Owner shall not, unless otherwise expressly provided in this Charter, be responsible for 620
any loss or damage to cargo arising or resulting from any act, neglect, default or barratry of Master, pilots, 621
mariners or other servants of Owner in the navigation or management of Vessel; fire, unless caused by the 622
personal design or neglect of Owner; collision, stranding, or peril, danger or accident of the sea or other 623
navigable waters; or from explosion, bursting of boilers, breakage of shafts, or any latent defect in hull, 624
equipment or machinery. Neither Vessel, Master or Owner, nor Charterer, shall unless otherwise expressly 625
provided in this Charter, be responsible for any loss or damage or delay or failure in performing hereunder 626
arising or resulting from: act of God; act of war; perils of the sea; act of public enemies, pirates or assailing 627
thieves; arrest or restraint of princes, rulers or people, or seizure under legal process, provided bond is 628
promptly furnished to release Vessel or cargo; strike or lockout or stoppage or restraint of labor from whatever 629
cause, either partial or general; or riot or civil commotion. 630

(b) The exceptions stated in Paragraph (a) of this Clause shall not affect Owner's warranties and undertakings 631
with respect to the condition of Vessel at the commencement of loading hereunder, the obligations of Owner 632
in respect of the loading, handling, stowage, carriage, custody, care and discharge of the cargo and/or the 633
rights or obligations of either Owner or Charterer with respect to laytime or demurrage as elsewhere provided 634
in this Charter. 635

30. LIEN 636

Owner shall have a lien on all cargoes and subfreights for all amounts due under this Charter, and Charterer shall 637
have a lien on Vessel for all monies paid in advance and not earned, and all disbursements for Owner's account, 638
including commissions, cost of insurance and expenses thereon and for any damages sustained by Charterer as a 639
result of the breach of this Charter by Owner. 640

31. AGENTS 641

Unless otherwise agreed, Charterer shall nominate and Owner shall appoint, instruct and pay Vessel's agents at 642
all port(s), and place(s), provided the fees charged by the nominated agents are competitive. 643

32. ASSIGNMENT/SUBLET 644

Charterer shall have the option of assigning this Charter or of subletting Vessel, but in either case, Charterer shall 645
always remain responsible for the due fulfillment of the Charter in all its terms and conditions. 646

33. CLEAN SEAS 647

(a) HANDLING OF TANK WASHINGS. Owner agrees to prohibit discharge overboard of oil and all oily water, 648
oily ballast or oil in any form unless in compliance with IMO and Port, State and local regulations or under 649
extreme circumstances whereby the safety of Vessel, cargo or life at sea would be imperiled. Owner shall 650
ensure that Vessel's personnel comply with the following: 651

(i) Subsequent to the date of this Charter and in the course of the ballast passage before presenting for 652
loading hereunder, any oily residues remaining in Vessel from its previous cargoes shall be retained on 653
board and shall be handled according to Charterer's instructions. 654

(ii) During tank washing, the tank washings shall be collected into one cargo compartment and, after 655
maximum separation of free water, such free water shall be discharged overboard to the extent permitted 656
by applicable international regulations. 657

(iii) Thereafter, Charterer shall be notified promptly by telegraph, telex or radio of the estimated quantity of 658
the segregated tank washings and the type and volume of oil and water contained in such washings and 659
source of such washings. 660

If Charterer requires that demulsifiers shall be used for the separation of oil/water, such demulsifiers shall be 661
obtained by Owner and paid for by Charterer. Any additional Canal dues incurred on the ballast passage by 662
reason of Vessel having tank washings on board shall be for the sole account of Owner. 663

Owner shall ensure that Master, on Vessel's arrival at the loading port(s) or place(s), does the following: 664

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arranges for the measurement of the segregated tank washings in conjunction with the cargo supplier(s), 665
records the quantity of tank washings so measured in Vessel's ullage record, 666
issues a Slop Certificate, arranges that the Slop Certificate and/or Vessel's ullage record be duly signed 667
by the cargo suppliers) and promptly sent to Charterer. 668

(b) The segregated tank washings and any other oily residues on board (hereinafter called "residues") shall, at 669
Charterer's option, be pumped ashore into slop facilities at the loading port(s) or place(s), commingled with 670
the cargo to be loaded or segregated from the cargo to be loaded. If Charterer requires Master to discharge 671
the residue at facilities at loading port(s) or place(s), no freight shall be payable on same but the time involved 672
in accomplishing such discharge shall count as laytime or, if Vessel is on demurrage, as time on demurrage. 673
Further, the cost of such facilities and the ultimate disposal of the residues shall be for Charterer's sole 674
account. 675

(c) If Charterer requires residues to be kept separate from the cargo to be loaded, same shall, at Charterer's 676
option, be discharged at the discharging port(s) or place(s) in accordance with Charterer's instructions. 677

(d) If Charterer requires that the cargo be loaded on top of residues or that such residues be kept separate from 678
the cargo to be loaded, in either case freight shall be payable in accordance with Clause 6 on the quantity of 679
r residues at the Overage Rate, if such rate exists, or otherwise at the Base Freight Rate, up to a maximum 680
tonnage equivalent to one (1) percent of Vessel's deadweight as specified in Part I (A), with the exception 681
that, no freight shall be paid for the water portion of slops. In no event shall Charterer have any liability for 682
deadfreight in connection with residues. 683

(e) Nothing in Charterer's instructions shall be construed as permission to contravene any applicable laws or 684
regulations by the discharging of oily residues. 685

(f) DETERGENTS/CHEMICALS. The Vessel shall arrive at loading port(s) or place(s) with clean ballast and 686
Owner guarantees that the slops and ballast on board the Vessel do not contain any detergents or chemicals. 687
If the slops or ballast contain any detergents or chemicals, any damages incurred thereby shall be for 688
Owner's account. 689

(g) Owner warrants that it is a member of the International Tanker Owners Pollution Federation Limited ("ITOPF") 690
and will retain such membership during the entire period of this Charter Party. 691

34. ARBITRATION 692

Any and all differences and disputes of whatsoever nature arising out of this Charter shall be put to arbitration in 693
the place specified in Part I (L), pursuant to the laws relating to arbitration there in force, before a Board of three 694
persons, consisting of one arbitrator to be appointed by Owner, one by Charterer and one by the two so chosen. 695
The decision of any two of the three on any point or points shall be final. Until such time as the arbitrators finally 696
close the hearings either party shall have the right by written notice served on the arbitrators and on the other 697
party to specify further disputes or differences under this Charter for hearing and determination. The arbitrators 698
may grant any relief which they, or a majority of them, deem just and equitable and within the scope of the 699
agreement of the parties, including, but not limited to, specific performance. Awards made pursuant to this Clause 700
may include costs, including a reasonable allowance for attorney's fees, and judgment may be entered upon any 701
award made hereunder in any Court having jurisdiction in the premises. 702

35. WAIVER OF CLAIMS 703

Any claim for freight, deadfreight, demurrage and/or charges or expenses under this Charter shall be deemed 704
waived, extinguished and absolutely barred if such claim is not received by Charterer or Owner, as the case may 705
be, in writing with supporting documentation within ninety (90) days from the date of final discharge of the cargo 706
on the voyage with respect to which said claim arises. This Clause shall not apply with respect to claims for 707
damage, contamination, loss, or shortage of cargo. 708

36. BUSINESS POLICY 709

Owner agrees that any details of this fixture shall be absolutely private and confidential and shall not be released 710
to any third parties. Owner agrees that all financial settlements, billings and reports rendered by Owner to 711
Charterer, as provided for in this Charter, shall, In reasonable detail, accurately and fairly reflect the facts about all 712
activities and transactions handled for the account of Charterer. 713

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VELAVOY2005

37. CHARTERER'S OPTION TO ADJUST SPEED 714

(a) The voyage shall be performed at the Base Speed specified in Part I (A). Charterer shall have the option, 715
which may be exercised as many times as Charterer deems necessary prior to or during the voyage, to order 716
Vessel to increase speed from the Base Speed to the Maximum Speed specified in Part I (A) or to any interim 717
speed. Charterer may order Vessel to return to the Base Speed at any time. 718

(b) If Charterer exercises this option, the freight rate shall be increased by the percentage point(s) per knot of 719
increased speed specified in Part I (G), but this increased Freight Rate shall apply only to miles actually 720
steamed at an increased speed pursuant to Charterer's orders, provided such miles do not exceed the total 721
voyage miles as per the BP Distance Tables. 722

Worldscale [ Miles Steamed at Increased Speeds(s) X Increased 723

Base [ Freight 724
Rate [ Total Voyage Miles as per BP Rate 725
[ Distance Tables, including mileage 726
[ to and from any storage location 727

(c) Prior to the voyage or prior to the termination of any period of floating storage, Charterer may order Vessel to 728
arrive at the discharge port or place on a certain date, in which case Vessel shall proceed at whatever speeds 729
may be necessary in order to arrive on the specified date so long as the speed is not reduced below the Base 730
Speed. 731

(d) Upon receipt of Charterer's orders to adjust speed, and upon each change in speed if Charterer elects the 732
option set forth in Paragraph (c) of this Clause, the Master shall advise Charterer of the date, time, Vessel's 733
position, miles steamed and revised ETA discharge port or place. Log extracts showing miles steamed at 734
each speed shall be included with Owner's invoice. 735

(e) Demurrage shall remain as stated in Part I (K) and without adjustment for changes in speed. 736

38. STORAGE 737

(a) Charterer shall have the option to use Vessel for floating storage off loadport or place and/or en route and/or 738
off discharge port or place for up to a maximum of one hundred twenty (120) days. Such option shall be 739
declared not less than one hundred twenty (120) hours prior to ETA first discharge port or place or storage 740
area. Charterer shall thereinafter give Owner seventy-two (72) hours notice of termination of floating storage 741
and Owner is under an obligation to sail upon the expiration of such period. Charterer shall pay Storage Rate 742
specified in Part I (H) or pro-rata for each day Vessel is used as floating storage. Storage hire for the first 743
fifteen (15) days is payable upon arrival at storage area, thereafter storage hire is payable every fifteen (15) 744
days in advance. 745

(b) Said Storage Rate is inclusive of all bunkers, maintenance, operating and incidental expenses incurred during 746
or as a result of floating storage. 747

(c) Floating storage period shall commence upon Vessel's arrival at a floating storage area designated by 748
Charterer and shall cease upon Vessel's sailing from same. Any deviation from most direct route to 749
nominated discharge port or place required to commence or end storage shall be subject to the provisions of 750
Clause 9. Vessel may be at anchor, moored or drifting during floating storage period. 751

(d) If Vessel goes into floating storage: 752

(i) Within same range as loading port or place, no ocean freight is payable until Vessel completes 753
discharging its cargo; 754

(ii) Within same range as discharge port or place, seventy-five percent (75%) of the ocean freight is payable 755
when Vessel arrives at the storage area and the balance is payable when the Vessel completes 756
discharging its cargo; 757

(iii) At any place not falling within (I) or (ii), fifty percent (50%) of the ocean freight is payable when the 758
Vessel arrives at the storage area and the balance is payable when Vessel completes discharging. 759

(e) Charterer has the right once Vessel is in storage to order Vessel in and out of storage area one or more times 760
to discharge cargo. If such discharge is within same range as storage location, time from and to storage area 761

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 VELAVOY2005

shall be at the Storage Rate specified in Part I (H) with Charterer paying all bunkers for steaming and all port 762
charges, except for final discharges. Otherwise, Clause 9 shall apply to Charterer's orders, except for final 763
discharge. Time used from connecting hoses to disconnecting hoses shall count as laytime or, if Vessel is on 764
demurrage, as time on demurrage. 765

(0 After termination of floating storage, any diminution in Vessel's performance and any additional bunkers 766
consumed as a result of bottom fouling shall be for Owner's account. Further, any such diminution shall not 767
relieve the Owner howsoever from the performance of its obligations under the Charter. 768

39. CARRIER INITIATIVE AGREEMENT 769

Unless Owner has its own Sea Carrier Initiative Agreement, Owner agrees to carry out Charterer's obligations 770
under the Sea Carrier Initiative Agreement between Charterer and the United States Customs Service to the 771
extent applicable to Vessel's operations during the voyage. A copy of this Agreement shall be provided to Owner 772
upon request. 773

40. SCAC CLAUSE 774

/S^\
Owner shall provide to Charterer, prior to the loading of cargo on the Vessel, a Unique Bill of Lading Identifier, 775
containing Owner's Standard Carrier Alpha Code (SCAC) assigned to Owner by the National Motor Freight Traffic 776
Association, Alexandria, Virginia, pursuant to the requirements of Section 4.7a, Customs Regulations (19 CFR 777
4.7a). Master shall affix said Unique Bill of Lading Identifier on all Bills of Lading for the cargo and on all other 778
available waybills, Sea Waybills, Traveling Manifests, Abstract Manifests, and documents requiring a Bill of Lading 779
Number. Charterer or Charterer's Agent shall arrange that all such documents requiring said Bill of Lading 780
Identifier be made available to Master. Any delays in the loading or discharging of cargo resulting from Owner's 781
failure to provide to Charterer the said Unique Bill of Lading Identifier and/or from Master's failure to affix the same 782
on the Bills of Lading and other relevant documents shall not count as laytime or, if Vessel is on demurrage, as 783
time on demurrage and any expense attributable to such delay shall be for Owner's account. 784

41. OCIMF DRUG AND ALCOHOL GUIDELINES 785

Vessel shall comply with the OCIMF Guidelines for the control of drugs and alcohol onboard ship. 786

42. LETTER OF INDEMNITY 787

If Charterer by telex, facsimile or other form of written communication that specifically refers to this Clause 788
requests Owner to discharge a quantity of cargo: 789

• without presentation of original Bills of Lading and/or 790

• at a discharge place other than that named in a Bill of Lading and/or 791
• that is different from the Bill of Lading quantity and/or 792
• to a receiver/consignee other than the receiver/consignee designated in the original Bill(s) of Lading 793

then Owner shall discharge such cargo in accordance with Charterer's instructions in consideration of receiving 794
the following indemnity which shall be deemed to be given by Charterer on each and every such occasion and 795
which is limited in value to 200% of the C.I.F. value of the cargo carried on board: 796

(a) Charterer shall indemnify Owner, and Owner's servants and agents in respect of any liability, loss or damage 797
of whatsoever nature (including legal costs as between attorney or solicitor and client and associated 798
expenses) which Owner may sustain by reason of delivering such cargo in accordance with Charterer's 799
request. 800

(b) If any proceeding is commenced against Owner or any of Owner's servants or agents in connection with 801
Vessel having delivered cargo in accordance with such request, Charterer shall provide Owner or any of 802
Owner's servants or agents from time to time on demand with sufficient funds to defend the said proceedings. 803

(c) If Vessel or any other vessel or property belonging to Owner should be arrested or detained, or if the arrest or 804
detention thereof should be threatened by reason of discharge in accordance with Charterer's instructions as 805
aforesaid, Charterer shall provide on demand such bail or other security as may be required to prevent such 806
arrest or detention or to secure the release of such vessel or property and Charterer shall indemnify Owner in 807
respect of any loss, damage or expenses caused by such arrest or detention whether or not the same may be 808
justified. 809

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 VELAVOY2005

(d) Charterer shall, if called upon to do so at any time while such cargo is in Charterer's possession, custody or 810
control, redeliver the same to Owner. 811

(e) As soon as all original Bills of Lading for the above cargo which name as discharge port the place where 812
delivery actually occurred shall have arrived and/or come into Charterer's possession, to produce and deliver 813
the same to Owner whereupon Charterer's liability hereunder shall cease. Provided however, if Charterer has 814
not received all such original Bills of Lading by 2400 hours on the day thirty-six (36) calendar months after the 815
date of discharge, then this indemnity shall terminate at that time unless before that time Charterer has 816
received from Owner written notice that some person is making a claim in connection with Owner delivering 817
cargo pursuant to Charterer's request, or legal proceedings have been commenced against Owner and/or 818
carrier and/or Charterer and/or any of their respective servants or agents and/or Vessel for the same reason. 819
When Charterer has received such a notice, then this indemnity shall continue in force until such claim or 820
legal proceedings are settled. Termination of this indemnity shall not prejudice any legal rights a party may 821
have outside this indemnity. 822

(f) Owner shall promptly notify Charterer if any person (other than a person to whom Charterer ordered cargo to 823
Am,
be delivered) claims to be entitled to such cargo and/or if Vessel or any other property belonging to Owner is 824
arrested by reason of any such discharge of cargo. 825

43. ISPS CODE AND VESSEL/PORT SECURITY 826

827
(a) OWNER. 828

(i) Owner warrants that the Vessel and "the Company", as that term is defined and understood in the ISPS 829
Code, shall comply with the requirements of the ISPS Code related to the Vessel and "the Company". 830
Upon request, Owner shall provide to Charter a copy of the Vessel's International Ship Security 831
Certificate (ISSC) or Interim ISSC. Owner shall provide Charterer with the full style contact details for the 832
Company Security Officer (CSO). 833

(ii) Except as otherwise provided in this Charter, any and all loss, damage, or expense, excluding 834
consequential loss, caused by failure of the Vessel, "the Company" or Owner to comply with the 835
requirements of the ISPS Code or this Clause shall be for Owner's account and any delay caused by said 836
failure shall not count as laytime or, if the ship is on demurrage, as time on demurrage. 837

(b) CHARTERER. 838

(i) Charterer shall provide the CSO and the Vessel's Ship Security Officer (SSO)/Master with full style 839
contact details and any other information that Owner, "the Company", or the Vessel may require to 840
comply with the ISPS Code. 841

(ii) Except as otherwise provided in this Charter, any and all loss, damage, or expense, excluding 842
consequential loss, caused by failure on the part of Charterer or its agents or representatives to comply 843
with this clause shall be for Charterer's account and any delay caused by such failure shall count as 844
laytime or, if the ship is on demurrage, as time on demurrage, for which Owner shall be compensated at 845
the demurrage rate. 846

(c) DELAY. Provided that the delay is not caused by Owner's, "the Company's", or the Vessel's negligence or 847
failure to comply with the requirements of the ISPS Code, the following shall apply: 848

(i) Notwithstanding anything to the contrary provided in this Charter, the Vessel shall be entitled to tender 849
Notice of Readiness even if not cleared due to applicable security regulations or measures imposed by a 850
port facility or any other relevant government authority under the ISPS Code. 851

(ii) Any delay resulting from measures imposed by a port facility or by any relevant government authority 852
under the ISPS Code shall count as laytime or, if the Vessel is on demurrage, as time on demurrage. If 853
the delay occurs before laytime has commenced, or after laytime or time on demurrage has ceased to 854
count, it shall be compensated by Charterer at the demurrage rate. 855

856
(d) ADDITIONAL COSTS AND EXPENSES. 857

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 VELAVOY2005

(i) Any delay caused by failure of the Vessel or its agents to report and/or send required notices to obtain 858
entry or exit clearances into or from any port facility shall be for Owner's account, unless such failure is 859
caused by Charterer or its representatives or agents, including, but not limited to the shipper and/or 860
receiver of the cargo, and all such delays shall not count as laytime or, if the Vessel is on demurrage, as 861
time on demurrage. 862

(ii) Notwithstanding anything to the contrary provided in this Charter, any other additional costs or expenses 863
whatsoever arising out of or related to security regulations or measures required by the port facility or any 864
relevant government authority under the ISPS Code or otherwise, including, but not limited to, security 865
guards, launch services, tug escorts, port fees or taxes and inspections, shall be for Charterer's account, 866
unless such costs or expenses result solely from the Owner's negligence or from the failure of the Vessel 867
or "the Company" to comply with the requirements of the ISPS Code or to send the required reports 868
and/or notices for entry to and exit from the port facility. All such measures required by the Owner in 869
order to comply with the Vessel's Ship Security Plan shall be for Owner's account. 870

(e) INDEMNITY. If either party makes any payment which is for the other party's account under the terms of this 871
Clause, the other party shall indemnify the paying party. 872

(f) CONFIDENTIALITY. During the period of this Charter, Owner hereby warrants that it will keep all information 873
related to Vessel orders, Vessel movements and other Vessel activities strictly confidential and will disclose 874
such information only to those personnel who are directly involved on behalf of Owner with the safe and 875
timely operation of the Vessel and that it will instruct said personnel as to these confidentiality requirements. 876

(g) CONCLUSIVE DETERMINATION. A determination by the port facility or relevant government authority at the 877
port where the Vessel is located that the Vessel or "the Company" is not compliant with the requirements of 878
the ISPS Code, or that the Vessel or its agent has failed to provide the necessary reports and/or notices 879
required for entry to or exit from the port facility, shall be deemed conclusive as between Owner and 880
Charterer for purposes of enforcement of the provisions of this Clause. 881

44. INTERPRETATION 882

The interpretation of this Charter and the rights and obligations of the parties thereto shall be governed by the 883
laws applicable to charter parties made in the place specified in Part I (L). The headings of Clauses and 884
Paragraphs are for convenience of reference only and shall not affect the interpretation of this Charter. No 885
modification, waiver or discharge of any term of this Charter shall be valid unless in writing and signed by the party 886
to be charged therewith. Notwithstanding anything in this Charter to the contrary, this Charter shall not be 887
interpreted or applied so as to require Owner or Charterer to do, or to refrain from doing, anything which would 888
constitute a violation of, or result In a loss of economic benefit under United States anti-boycott laws and 889
regulations. 890

45. ADDRESS COMMISSION CLAUSE 891

^m^
An Address Commission of one and one quarter percent (1% %) of all freight, deadfreight and demurrage 892
payments shall be payable by Owner to Charterer. Charterer shall have the right to deduct this Address 893
Commission from all freight, deadfreight and demurrage payments before remitting same to Owner. 894

46. ADMINISTRATION CLAUSE 895

The preparation and signing of a formal charter party shall not be required should Owner and Charterer agree 896
during fixture negotiations that, in lieu thereof, this Charter shall be accomplished, and thereafter this Charter is 897
accomplished, by the following means: 898

(a) Within twenty-four (24) hours of the conclusion of fixture negotiations, Owner's broker shall prepare and 899
transmit to Owner and Charterer a fixture recap: 900

(i) identifying the printed form of charter party; 901

(ii) detailing all amendments, additions and deletions to the printed form; 902
(iii) setting out all additional clauses to the printed form in full; 903
(iv) stating that the parties have agreed to forego the preparation and signing of a formal charter party; 904
(v) specifying the time within which the parties' confirmations of the fixture recap must be received. 905

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VELAVOY2005

(b) Withinthe time prescribed, Owner and Charterer shall confirm by return telex, facsimile or electronic mail that 906
the fixture recap is accurate. Upon receipt of such confirmations, Owner's broker shall immediately forward 907
the same to the other party. At the time Owner's broker receives the last of such confirmations, the charter 908
party shall be deemed to have been signed by both parties. 909

(c) If no broker is involved in the negotiation of this Charter, Owner shall prepare the fixture recap in accordance 910
with (a) above and the charter party shall be deemed to have been signed by both parties when Owner 911
receives Charterer's confirmation thereof within the time prescribed. 912

(d) The effective date of this Charter shall be the date of the fixture recap, which shall be conclusive evidence of 913
its terms. 914

47. PRESENTATION CLAUSE (LPG VESSELS) 915

Vessel shall arrive at load port in a condition ready to load either under LPG vapors and heel or at Owner's option 916
(declarable prior to fixing) under nitrogen gas in which case Charterer will endeavor to make product available for 917
purging/cooling upon arrival at load port. All time, shifting expenses and other expenses whatsoever associated 918
with purging and cooling shall be for Owner's account. Product quantity required for cooling shall be included in 919
the Bill of Lading quantity; however any product lost in this respect will be for Owner's account and shall be 920
deducted from freight due. Prior to commencement of and during loading, Vessel's tanks shall be adequately 921
cooled to receive the designated product, i.e., maximum of minus 39°C for propane and maximum of minus 4°C 922
for butane. Charterer shall not be responsible for deadfreight claims arising from cargo quantity differences if 923
Vessel's tank temperatures do not meet above-specified maximums. 924

48. SAUDI ARABIA TAX CLAUSE (NONRESIDENT OWNERS/COASTWISE TRADE) 925

In accordance with the Income Tax Law of the Kingdom of Saudi Arabia, Charterer is required to withhold and 926
remit to the Department of Zakah and Income Tax (DZIT) withholding tax on payments of marine freight to 927
nonresident vessel owners who enter into voyage charter parties with Charterer for coastwise trade in Saudi 928
Arabia. Charterer is required by law to pay this tax on behalf of such nonresident vessel owners and to 929
collect/deduct the tax paid from marine freight due Owner under the Charter. The tax is determined by multiplying 930
all freight, deadfreight and demurrage payments by five percent (5 %) and will be deducted from any payments 931
due Owner under this Charter. 932

49. SAUDI ARABIA TAX CLAUSE (RESIDENT OWNERS) 933

Owner warrants that it is a resident of the Kingdom of Saudi Arabia, that it is legally registered to do business in 934
the Kingdom of Saudi Arabia and that it files with the Department of Zakah and Income Tax (DZIT) a zakah or 935
income tax declaration and pays its appropriate tax obligations. Owner further warrants that it will pay any and all 936
of its zakah or income tax obligations with respect to this Charter. Each year Owner shall provide Charterer with a 937
copy of the zakah or income tax clearance certificate issued by DZIT and shall indemnify Charterer for any zakah 938
or income tax, plus any fines, that DZIT may impose on Charterer as a result of Owner's failure to provide such 939
certificate and/or meet its zakah or income tax obligations with respect to this Charter. 940

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