EX-4.2 3 d949849dex42.htm EX-4.2 EX-4.2

Exhibit 4.2

Printed by BIMCO’s idea

 

LOGO LOGO

SHIPMAN 2009

STANDARD SHIP MANAGEMENT AGREEMENT

 

PART I

LOGO 1. Place and date of Agreement 2.

Date of commencement of Agreement (Cls. 2, 12, 21 and 25)

 

Copenhagen, May 13th, 2014

 

      
3.

Owners (name, place of registered office and law of registry) (Cl. 1)

 

 4.

Managers (name, place of registered office and law of registry) (Cl. 1)

 

(i)

Name: KNOT Shuttle Tankers 21 AS

 

 (i) Name: KNOT Management Denmark A/S
(ii)

Place of registered office: c/o Knutsen NYK Offshore Tankers

 

 (ii) Place of registered office:
(iii)

Law of registry: Norway

 

 (iii) Law of registry: Denmark
5.

The Company (with reference to the ISM/ISPS Codes) (state name and IMO Unique Company Identification number. If the Company is a third party then also state registered office and principal place of business) (Cls. 1 and 9(c)(i))

 

 6.

Technical Management (state “yes” or “no” as agreed) (Cl. 4)

No

(i)

Name:

 

 7.

Crew Management (state “yes” or “no” as agreed) (Cl. 5(a))

No

(ii)

IMO Unique Company Identification number:

 

  
(iii)

Place of registered office:

 

 8.

Commercial Management (state “yes” or “no” as agreed) (Cl. 6)

Yes

(iv)

Principal place of business:

 

  
9.

Chartering Services period (only to be filled in if “yes” stated in Box 8) (Cl.6(a))

Yes

 

 10. Crew Insurance arrangements (state “yes” or “no” as agreed)
(i)

Crew Insurances* (Cl. 5(b)): No

 

(ii)

Insurance for persons proceeding to sea onboard (Cl. 5(b)(i)): No

 

*only to apply if Crew Management (Cl. 5(a)) agreed (see Box 7)

 

11.

Insurance arrangements (state “yes” or “no” as agreed) (Cl. 7)

No

 12.

Optional Insurances (state optional insurance(s) as agreed, such as

piracy, kidnap and ransom, loss of hire and FD & D) (CI. 10(a)(iv))

 

13. Interest (state rate of interest to apply after due date to outstanding sums) (Cl. 9(a)) 14.

Annual management fee (state annual amount) (Cl. 12(a))

USD 289,721 (to be increased by 4 per cent annually, first increase on 1 January 2015)

 

15. Manager’s nominated account (C1.12(a)) 16.

Daily rate (state rate for days in excess of those agreed in budget) (Cl. 12(c))

 

17.

Lay-up period / number of months (CI.12(d))

 

18. Minimum contract period (state number of months) (Cl. 21(a)) 19.

Management fee on termination (state number of months to apply) (Cl. 22(g))

 

20. Severance Costs (state maximum amount) (Cl. 22(h)(ii)) 21.

Dispute Resolution (state alternative Cl. 23(a), 23(b) or 23(c); if Cl. 23(c) place of arbitration must be stated) (Cl. 23)

Danish law, Danish arbitration

 

22. Notices (state full style contact details for serving notice and communication to the Owners) (Cl. 24) 23.

Notices (state full style contact details for serving notice and communication to the Managers) (Cl. 24)

 

 

It is mutually agreed between the party stated in Box 3 and the party stated in Box 4 that this Agreement consisting of PART I and PART II as well as Annexes “A” (Details of Vessel or Vessels), “B” (Details of Crew), “C” (Budget), “D” (Associated Vessels) and “E” (Fee Schedule) attached hereto, shall be performed subject to the conditions contained herein. In the event of a conflict of conditions, the provisions of PART I and Annexes “A”, “B”, “C”, “D” and “E” shall prevail over those of PART II to the extent of such conflict but no further.

 

Signature(s) (Owners)

 

 Signature(s) (Managers)

/s/ Karl Gerhard Bråstein Dahl

 

 /s/ Karl Gerhard Bråstein Dahl

 

Continued

This document is a computer generated SHIPMAN 2009 form printed by authority of BIMCO. Any insertion or deletion to the form must be clearly visible. In the event of any modification made to the pre-printed text of this document which is not clearly visible, the text of the original BIMCO approved document shall apply. BIMCO assumes no responsibility for any loss, damage or expense as a result of discrepancies between the original BIMCO approved document and this computer generated document.

Printed by BIMCO’s idea

 

LOGO

 

LOGO

ANNEX “A” (DETAILS OF VESSEL OR VESSELS)

TO THE BIMCO STANDARD SHIP MANAGEMENT AGREEMENT

CODE NAME: SHIPMAN 2009

 

Date of Agreement:

Name of Vessel(s): Costco Nantong Shipyard Hull No 266 (to be named Dan Sabia)

 

Particulars of Vessel(s):    
Type : Double Hull Shuttle Tanker
Year of built : 2012
Flag : DIS
Class : DNV
DWT : 59.000
Cargo gear : 3x1500 m3/h vertical single stage centrifugal pump elec. driven
Main engine type : 2-stoke low speed diesel, MAN B&W 6850MC-7
 

 

Continued

This document is a computer generated SHIPMAN 2009 form printed by authority of BIMCO. Any insertion or deletion to the form must be clearly visible. In the event of any modification made to the pre-printed text of this document which is not clearly visible, the text of the original BIMCO approved document shall apply. BIMCO assumes no responsibility for any loss, damage or expense as a result of discrepancies between the original BIMCO approved document and this computer generated document.

Printed by BIMCO’s idea

 

LOGO

 

LOGO

ANNEX “B” (DETAILS OF CREW)

TO THE BIMCO STANDARD SHIP MANAGEMENT AGREEMENT

CODE NAME: SHIPMAN 2009

 

Date of Agreement:

Details of Crew:

 

Number Rank Nationality
OFFICERS
1 Master (0IM) EU
1 Chief Officer (SDPO) EU
1 2nd Officer (SDPO) EU
1 2nd Officer (DPO) EU
1 2nd Officer (DPO) EU
0,5 2nd Officer (DPO)* EU
I Chief Engineer EU
1 2nd Engineer EU
1 3rd Engineer EU
1 4th Engineer PHIL
1 Electrician (DP) EU
Total officers onboard 10,5
* Supernumerary dual officer position
RATINGS
1 Bosun PHIL
1 Pumpman PHIL
1 AB PHIL
1 AB PHIL
1 OS PHIL
1 Motorman PHIL
1 Wiper PHIL
1 Fitter PHIL
1 Cook PHIL
1 MESSMAN PHIL
Total ratings onboard 10
TOTAL CREW 20,5 PERSONS ONBOARD
Numbers Rank Nationality
 

 

Continued

This document is a computer generated SHIPMAN 2009 form printed by authority of BIMCO. Any insertion or deletion to the form must be clearly visible. In the event of any modification made to the pre-printed text of this document which is not clearly visible, the text of the original BIMCO approved document shall apply. BIMCO assumes no responsibility for any loss, damage or expense as a result of discrepancies between the original BIMCO approved document and this computer generated document.

Printed by BIMCO’s idea

 

LOGO

 

LOGO

ANNEX “C” (BUDGET)

TO THE BIMCO STANDARD SHIP MANAGEMENT AGREEMENT

CODE NAME: SHIPMAN 2009

 

Date of Agreement:

Managers’ initial budget with effect from the commencement date of this Agreement (see Box 2):

TBA

 

 

Continued

This document is a computer generated SHIPMAN 2009 form printed by authority of BIMCO. Any insertion or deletion to the form must be clearly visible. In the event of any modification made to the pre-printed text of this document which is not clearly visible, the text of the original BIMCO approved document shall apply. BIMCO assumes no responsibility for any loss, damage or expense as a result of discrepancies between the original BIMCO approved document and this computer generated document.

Printed by BIMCO’s idea

 

LOGO

 

LOGO

ANNEX “D” (ASSOCIATED VESSELS)

TO THE BIMCO STANDARD SHIP MANAGEMENT AGREEMENT

CODE NAME: SHIPMAN 2009

 

NOTE: PARTIES SHOULD BE AWARE THAT BY COMPLETING THIS ANNEX “D” THEY WILL BE SUBJECT TO THE PROVISIONS OF SUB-CLAUSE 22(b)(i) OF THIS AGREEMENT.

Date of Agreement:

Details of Associated Vessels:

 

 

Continued

This document is a computer generated SHIPMAN 2009 form printed by authority of BIMCO. Any insertion or deletion to the form must be clearly visible. In the event of any modification made to the pre-printed text of this document which is not clearly visible, the text of the original BIMCO approved document shall apply. BIMCO assumes no responsibility for any loss, damage or expense as a result of discrepancies between the original BIMCO approved document and this computer generated document.

Printed by BIMCO’s idea

 

LOGO

 

LOGO

ANNEX “E” (FEE SCHEDULE)

TO THE BIMCO STANDARD SHIP MANAGEMENT AGREEMENT

CODE NAME: SHIPMAN 2009

 

 

 

Continued

This document is a computer generated SHIPMAN 2009 form printed by authority of BIMCO. Any insertion or deletion to the form must be clearly visible. In the event of any modification made to the pre-printed text of this document which is not clearly visible, the text of the original BIMCO approved document shall apply. BIMCO assumes no responsibility for any loss, damage or expense as a result of discrepancies between the original BIMCO approved document and this computer generated document.

PART II

SHIPMAN 2009

Standard ship management agreement

 

 

SECTION 1 – Basis of the Agreement

 

 

1. Definitions   1   

In this Agreement save where the context otherwise requires, the following words and expressions shall have

   2   

the meanings hereby assigned to them:

   3   

“Company” (with reference to the ISM Code and the ISPS Code) means the organization identified in Box 5

   4   

or any replacement organization appointed by the Owners from time to time (see Sub-clauses 9(b)(i) or 9(c)

   5   

(ii), whichever is applicable).

   6   

“Crew” means the personnel of the numbers, rank and nationality specified in Annex “B” hereto.

   7   

“Crew Insurances” means insurance of liabilities in respect of crew risks which shall include but not be limited

   8   

to death, permanent disability, sickness, injury, repatriation, shipwreck unemployment indemnity and loss

   9   

of personal effects (see Sub-clause 5(b) (Crew Insurances) and Clause 7 (Insurance Arrangements) and

   10   

Clause 10 (Insurance Policies) and Boxes 10 and 11).

   11   

“Crew Support Costs” means all expenses of a general nature which are not particularly referable to any

   12   

individual vessel for the time being managed by the Managers and which are incurred by the Managers for the

   13   

purpose of providing an efficient and economic management service and, without prejudice to the generality

   14   

of the foregoing, shall include the cost of crew standby pay, training schemes for officers and ratings, cadet

   15   

training schemes, sick pay, study pay, recruitment and interviews.

   16   

“Flag State” means the State whose flag the Vessel is flying.

   17   

“ISM Code” means the International Management Code for the Safe Operation of Ships and for Pollution

   18   

Prevention and any amendment thereto or substitution therefor.

   19   

“ISPS Code” means the International Code for the Security of Ships and Port Facilities and the relevant

   20   

amendments to Chapter XI of SOLAS and any amendment thereto or substitution therefor.

   21   

“Managers” means the party identified in Box 4.

   22   

“Management Services” means the services specified in SECTION 2 - Services (Clauses 4 through 7) as

   23   

indicated affirmatively in Boxes 6 through 8, 10 and 11, and all other functions performed by the Managers

   24   

under the terms of this Agreement.

   25   

“Owners” means the party identified in Box 3.

   26   

“Severance Costs” means the costs which are legally required to be paid to the Crew as a result of the early

   27   

termination of any contracts for service on the Vessel.

   28   

“SMS” means the Safety Management System (as defined by the ISM Code).

   29   

“STCW 95” means the International Convention on Standards of Training, Certification and Watchkeeping

   30   

for Seafarers, 1978, as amended in 1995 and any amendment thereto or substitution therefor.

   31   

“Vessel’ means the vessel or vessels details of which are set out in Annex “A” attached hereto.

   32   
2. Commencement and Appointment   33   

With effect from the date stated in Box 2 for the commencement of the Management Services and continuing

   34   

unless and until terminated as provided herein, the Owners hereby appoint the Managers and the Managers

   35   

hereby agree to act as the Managers of the Vessel in respect of the Management Services.

   36   
3. Authority of the Managers   37   

Subject to the terms and conditions herein provided, during the period of this Agreement the Managers shall

   38   

carry out the Management Services in respect of the Vessel as agents for and on behalf of the Owners. The

   39   

Managers shall have authority to take such actions as they may from time to time in their absolute discretion

   40   

consider to be necessary to enable them to perform the Management Services in accordance with sound

   41   

ship management practice, including but not limited to compliance with all relevant rules and regulations.

   42   

 

1

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SHIPMAN 2009

Standard ship management agreement

 

 

SECTION 2 – Services

 

 

4. Technical Management   43   

(only applicable if agreed according to Box 6).

   44   

The Managers shall provide technical management which includes, but is not limited to, the following

   45   

services:

   46   

(a) ensuring that the Vessel complies with the requirements of the law of the Flag State;

   47   

(b) ensuring compliance with the ISM Code;

   48   

(c) ensuring compliance with the ISPS Code;

   49   

(d) providing competent personnel to supervise the maintenance and general efficiency of the vessel;

   50   

(e) arranging and supervising dry dockings, repairs, alterations and the maintenance of the Vessel to the

   51   

standards agreed with the Owners provide that the Managers shall be entitled to incur the necessary

   52   

expenditure to ensure that the Vessel will comply with all requirements and recommendations of the

   53   

classification society, and with the law of the Flag State and of the places where the Vessel is required to

   54   

trade;

   55   

(f) arranging the supply of necessary stores, spares and lubricating oil;

   56   

(g) appointing surveyers and technical consultants as the Managers may consider form time to time to be

   57   

necessary;

   58   

(h) in accordance with the Owners’ instructions, supervising the sale and physical delivery of the Vessel

   59   

under the sale agreement. However services under this Sub-clause 4(h) shall not include negotiation of the

   60   

sale agreement or transfer of ownership of the Vessel;

   61   

(i) arranging for the supply of provisions unless provided by the Owners; and

   62   

(j) arranging for the sampling and testing of bunkers.

   63   
5. Crew Management and Crew Insurances   64   

(a) Crew Management

   65   

(only applicable if agreed according to Box 7)

   66   

The Managers shall provide suitably qualified Crew who shall comply with the requirements of STCW 95.

   67   

The provision of such crew management services includes, but is not limited to, the following services:

   68   

(i)      selecting, engaging and providing for the administration of the Crew, including, as applicable, payroll

   69   

arrangements, pension arrangements, tax, social security contributions and other mandatory dues related

   70   

to their employment payable in each Crew member’s country of domicile;

   71   

(ii)     ensuring that the applicable requirements of the law of the Flag State in respect of rank, qualification

   72   

and certification of the Crew and employment regulations, such as Crew’s tax and social insurances, are

   73   

satisfied;

   74   

(iii)    ensuring that all Crew have passed a medical examination with a qualified doctor certifying that they are

   75   

fit for the duties for which they are engaged and are in possession of valid medical certificates issued in

   76   

accordance with appropriate Flag State requirements or such higher standard of medical examination

   77   

as may be agreed with the Owners. In the absence of applicable Flag State requirements the medical

   78   

certificate shall be valid at the time when the respective Crew member arrives on board the Vessel and

   79   

shall be maintained for the duration of the service on board the Vessel;

   80   

(iv)    ensuring that the Crew shall have a common working language and a command of the English language

   81   

of a sufficient standard to enable them to perform their duties safely;

   82   

(v)     arranging transportation of the Crew, including repatriation;

   83   

(vi)    training of the Crew;

   84   

 

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SHIPMAN 2009

Standard ship management agreement

 

(vii)    conducting union negotiations; and

   85   

(viii)  if the Managers are the Company, ensuring that the Crew, on joining the Vessel, are given proper

   86   

familiarization with their duties in relation to the Vessel’s SMS and that instructions which are essential

   87   

to the SMS are identified, documented and given to the Crew prior to calling.

   88   

(ix)    if the Managers are not the Company:

   89   

(1)    ensuring that the Crew, before joining the Vessel, are given proper familiarisation with their duties

   90   

in relation to the ISM Code; and

   91   

(2)    instructing the Crew to obey all reasonable orders of the Company in connection with the operation

   92   

of the SMS.

   93   

(x)     Where Managers are not providing technical management services in accordance with Clause 4

   94   

(Technical Management):

   95   

(1)    ensuring that no person connected to the provision and the performance of the crew management

   96   

services shall proceed to sea on board the Vessel without the prior consent of the Owners (such consent)

   97   

not to be unreasonably withheld); and

   98   

(2)    ensuring that in the event that the Owners’ drug and alcohol policy requires measures to be taken

   99   

prior to the Crew joining the Vessel, implementing such measures;

   100   

(b) Crew Insurances

   101   

(only applicable if Sub-clause 5(a) applies and if agreed according to Box 10)

   102   

The Managers shall throughout the period of this Agreement provide the following services:

   103   

(i)      arranging Crew Insurances in accordance with the best practice of prudent managers of vessels of a

   104   

similar type to the Vessel, with sound and reputable insurance companies, underwriters or associations.

   105   

insurance for any other persons proceeding to see onboard the Vessel may be separately agreed by

   106   

the Owners and the Managers (see Box 10);

   107   

(ii)     ensuring that the Owners are aware of the terms, conditions, exceptions and limits of liability of the

   108   

insurances in Sub-clause 5(b)(i);

   109   

(iii)    ensuring that all premiums or calls in respect of the insurances in Sub-clause 5(b)(i) are paid by their

   110   

due date;

   111   

(iv)    if obtainable at no additional cost, ensuring that insurance in Sub-clause 5(b)(i) name the Owners as

   112   

a joint assured with full cover and, unless otherwise agreed, on terms such that Owners shall be under

   113   

no liability in respect of premiums or calls arising in connection with such insurances.

   114   

(v)     providing written evidence, to the reasonable satisfaction of the Owners, of the Managers’ compliance with

   115   

their obligations under Sub-clauses 5(b)(ii), and 5(b)(iii) within a reasonable time of the commencement

   116   

of this Agreement, and of each renewal date and, if specifically requested, of each payment date of the

   117   

insurances in Sub-clause 5(b)(i).

   118   
6. Commercial Management   119   

(only applicable if agreed according to Box 8).

   120   

The Managers shall provide the following services for the Vessel in accordance with the Owners’ instructions,

   121   

which shall include but not be limited to:

   122   

(a) seeking and negotiating employment for the Vessel and the conclusion (including the execution thereof)

   123   

of charter parties or other contracts relating to the employment of the Vessel. If such a contrast exceeds the

   124   

period states in Box 9, consent thereto in writing shall first be obtained from the Owners;

   125   

(b) arranging for the provision of bunker fuels of the quality specified by the Owners as required for the

   126   

Vessel’s trade;

   127   

(c) voyage estimating and accounting and calculation of hire, freights, demurrage and/or despatch monies

   128   

due from or due to the charterers of the Vessel; assisting in the collection of any sums due to the Owners

   129   

related to the commercial operation of the Vessel in accordance with Clause 11 (Income Collected and

   130   

 

3

PART II

SHIPMAN 2009

Standard ship management agreement

 

Expenses Paid on Behalf of Owners);

   131   

If any of the services under Sub-clauses 6(a), 6(b) and 6(c) are to be excluded from the Management Fee, remuneration

   132   

for these services must be stated in Annex E (Fee Schedule). See Sub-clause 12(e).

   133   

(d) issuing voyage instructions;

   134   

(e) appointing agents;

   135   

(f) appointing stevedores; and

   136   

(g) arranging surveys associated with the commercial operation of the Vessel.

   137   
7. Insurance Arrangements   138   

(only applicable if agreed according to Box 11).

   139   

The Managers shall arrange insurances in accordance with Clause 10 (Insurance Policies), on such terms as

   140   

the Owners shall have instructed or agreed, in particular regarding conditions, insured values, deductibles,

   141   

franchises and limits of liability.

   142   

 

4

PART II

SHIPMAN 2009

Standard ship management agreement

 

 

SECTION 3 – Obligations

 

 

8. Managers’ Obligations   143   

(a) The Managers undertake to use their best endeavours to provide the Management Services as agents

   144   

for and on behalf of the Owners in accordance with sound ship management practice and to protect and

   145   

promote the interests of the Owners in all matters relating to the provision of services hereunder.

   146   

Provided however, that in the performance of their management responsibilities under this Agreement, the

   147   

Managers shall be entitled to have regard to their overall responsibility in relation to all vessels as may from

   148   

time to time be entrusted to their management and in particular, but without prejudice to the generality of

   149   

the foregoing, the Managers shall be entitled to allocate available supplies, manpower and services in such

   150   

manner as in the prevailing circumstances the Managers in their absolute discretion consider to be fair and

   151   

reasonable.

   152   

(b) Where the Managers are providing technical management services in accordance with Clause 4 (Technical

   153   

Management), they shall procure that the requirements of the Flag State are satisfied and they shall agree

   154   

to be appointed as the Company, assuming the responsibility for the operation of the Vessel and taking over

   155   

the duties and responsibilities imposed by the ISM Code and the ISPS Code, if applicable.

   156   
9. Owners’ Obligations   157   

(a) The Owners shall pay all sums due to the Managers punctually in accordance with the terms of this

   158   

Agreement. In the event of payment after the due date of any outstanding sums the Manager shall be entitled

   159   

to charge interest at the rate stated in Box 13.

   160   

(b) Where the Managers are providing technical management services in accordance with Clause 4 (Technical

   161   

Management), the Owners shall:

   162   

(i)      report (or where the Owners are not the registered owners of the Vessel procure that the registered

   163   

owners report) to the Flag State administration the details of the Managers as the Company as required

   164   

to comply with the ISM and ISPS Codes;

   165   

(ii)     procure that any officers and ratings supplied by them or on their behalf comply with the requirements

   166   

of STCW 95; and

   167   

(iii)    instruct such officers and ratings to obey all reasonable orders of the Managers (in their capacity as the

   168   

Company) in connection with the operation of the Managers’ safety management system.

   169   

(c) Where the Managers are not providing technical management services in accordance with Clause 4

   170   

(Technical Management), the Owners shall:

(i)      procure that the requirements of the Flag State are satisfied and notify the Managers upon execution of

   172   

this Agreement of the name and contact details of the organization that will be the Company by completing

   173   

Box 5;

   174   

(ii)     if the Company changes at any time during this Agreement, notify the Managers in a timely manner of

   175   

the name and contact details of the new organization;

   176   

(iii)    procure that the details of the Company, including any change thereof, are reported to the Flag State

   177   

administration as required to comply with the ISM and ISPS Codes. The Owners shall advise the Managers

   178   

in a timely manner when the Flag State administration has approved the Company; and

   179   

(iv)    unless otherwise agreed, arrange for the supply of provisions at their own expense.

   180   

(d) Where the Managers are providing crew management services in accordance with Sub-clause 5(a) the

   181   

Owners shall:

   182   

(i)      inform the Managers prior to ordering the Vessel to any excluded or additional premium area under

   183   

any of the Owners’ Insurance by reason of war risks and/or piracy or like perils and pay whatever

   184   

additional costs may property be incurred by the Managers as a consequence of such orders including,

   185   

if necessary, the costs of replacing any member of the Crew. Any delays resulting from negotiation

   186   

with or replacement of any member of the Crew as a result of the Vessel being ordered to such an area

   187   

 

5

PART II

SHIPMAN 2009

Standard ship management agreement

 

shall be for the Owners’ account. Should the Vessel be within an area which becomes an excluded or

   188   

additional premium area the above provisions relating to cost and delay shall apply;

   189   

(ii)     agree with the Managers prior to any change of flag of the Vessel and pay whatever additional costs

   190   

may properly be incurred by the Managers as a consequence of such change. If agreement cannot be

   191   

reached then either party may terminate this Agreement in accordance with Sub-clause 22(e); and

   192   

(iii)    provide, at no cost to the Managers, in accordance with the requirements of the law of the Flag State,

   193   

or higher standard, as mutually agreed, adequate Crew accommodation and living standards.

   194   

(e) Where the Managers are not the Company, the Owners shall ensure that Crew are property familiarized

   195   

with their duties in accordance with the Vessel’s SMS and that instructions which are essential to the SMS

   196   

are identified, documented and given to the Crew prior to sailing.

   197   

 

6

PART II

SHIPMAN 2009

Standard ship management agreement

 

 

SECTION 4 – Insurance. Budgets, Income, Expenses and Fees

 

 

10. Insurance Policies   198   

The Owners shall procure, whether by instructing the Managers under Clause 7 (Insurance Arrangements)

   199   

or otherwise, that throughout the period of this Agreement:

   200   

(a) at the Owners’ expense, the Vessel is insured for not less than its sound market value or entered for its

   201   

full gross tonnage, as the case may be for:

   202   

(i) hull and machinery marine risks (including but not limited to crew negligence) and excess liabilities;

   203   

(ii) protection and indemnity risks (including but not limited to pollution risks, diversion expenses and,

   204   

except to the extent insured separately by the Managers in accordance with Sub-clause 5(b)(i), Crew

   205   

Insurances);

   206   

NOTE: If the Managers are not providing crew management services under Sub-clause 5(a) (Crew

   207   

Management) or have agreed not to provide Crew Insurances separately in accordance with Sub-clause

   208   

5(b)(i), then such insurances must be included in the protection and indemnity risks cover for the Vessel (see

   209   

Sub-clause 10(a)(ii) above).

   210   

(iii)    war risks (including but not limited to blocking and trapping, protection and indemnity, terrorism and crew

   211   

risks); and

   212   

(iv)    such optional insurances as may be agreed (such as piracy, kidnap and ransom, loss of hire and

   213   

FD & D) (see Box 12)

   214   

Sub-clauses 10(a)(i) through 10(a)(iv) all in accordance with the best practice of prudent owners of vessels

   215   

of a similar type to the Vessel, with sound and reputable insurance companies, underwriters or associations

   216   

(“the Owners’ Insurances”);

   217   

(b) all premiums and calls on the Owners’ Insurances are paid by their due date;

   218   

(c) the Owners’ Insurances name the Managers and, subject to underwriters’ agreement, any third party

   219   

designated by the Managers as a joint assured, with full cover. It is understood that in some cases, such as

   220   

protection and indemnity, the normal terms for such cover may impose on the Managers and any such third

   221   

party a liability in respect of premiums or calls arising in connection with the Owners’ Insurances.

   222   

If obtainable at no additional cost, however, the Owners shall procure such insurances on terms such that

   223   

neither the Managers nor any such third party shall be under any liability in respect of premiums or calls arising

   224   

in connection with the Owners’ Insurances. In any event, on termination of this Agreement in accordance

   225   

with Clause 21 (Duration of the Agreement) and Clause 22 (Termination), the Owners shall procure that the

   226   

Managers and any third party designated by the Managers as joint assured shall cease to be joint assured

   227   

and, if reasonably achievable, that they shall be released from any and all liability for premiums and calls

   228   

that may arise in relation to the period of this Agreement; and

   229   

(d) written evidence is provided, to the reasonable satisfaction of the Managers, of the Owners’ compliance

   230   

with their obligations under this Clause 10 within a reasonable time of the commencement of the Agreement,

   231   

and of each renewal date and, if specifically requested, of each payment date of the Owners’ Insurances.

   232   
11. Income Collected and Expenses Paid on Behalf of Owners   233   

(a) Except as provided in Sub-clause 11(c) all monies collected by the Managers under the terms of this

   234   

Agreement (other than monies payable by the Owners to the Managers) and any interest thereon shall be

   235   

held to the credit of the Owners in a separate bank account.

   236   

(b) All expenses incurred by the Managers under the terms of this Agreement on behalf of the Owners

   237   

(including expenses as provided in Clause 12(c)) may be debited against the Owners in the account referred to

   238   

under Sub-clause 11(a) but shall in any event remain payable by the Owners to the Managers on demand.

   239   

(c) All monies collected by the Managers under Clause 6 (Commercial Management) shall be paid into a

   240   

bank account in the name of the Owners or as may be otherwise advised by the Owners in writing.

   241   
12. Management Fee and Expenses   242   

 

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(a) The Owners shall pay to the Managers an annual management fee as stated in Box 14 for their services

   243   

as Managers under this Agreement, which shall be payable in equal monthly instalments in advance, the first

   244   

instalment (pro rata if appropriate) being payable on the commencement of this Agreement (see Clause 2

   245   

(Commencement and Appointment) and Box 2) and subsequent instalments being payable at the beginning

   246   

of every calendar month. The management fee shall be payable to the Managers’ nominated account stated

   247   

in Box 15.

   248   

(b) The management fee shall be subject to an annual review and the proposed fee shall be presented in

   249   

the annual budget in accordance with Sub-clause 13(a).

   250   

(c) The Managers shall, at no extra cost to the Owners, provide their own office accommodation, office staff,

   251   

facilities and stationery. Without limiting the generality of this Clause 12 (Management Fee and Expenses) the

   252   

Owners shall reimburse the Managers for postage and communication expenses, travelling expenses, and

   253   

other out of pocket expenses properly incurred by the Managers in pursuance of the Management Services.

   254   

Any days used by the Managers’ personnel travelling to or from or attending on the Vessel or otherwise used

   255   

in connection with the Management Services in excess of those agreed in the budget shall be charged at

   256   

the daily rate stated in Box 16.

   257   

(d) If the Owners decide to layup the Vessel and such layup lasts for more than the number of months

   258   

stated in Box 17, an appropriate reduction of the Management Fee for the period exceeding such period

   259   

until one month before the Vessel is again put into service shall be mutually agreed between the parties. If

   260   

the Managers are providing crew management services in accordance with Sub-clause 5(a), consequential

   261   

costs of reduction and reinstatement of the Crew shall be for the Owners’ account. If agreement cannot be

   262   

reached then either party may terminate this Agreement in accordance with Sub-clause 22(e).

   263   

(e) Save as otherwise provided in this Agreement, all discounts and commissions obtained by the Managers

   264   

in the course of the performance of the Management Services shall be credited to the Owners.

   265   
13. Budgets and Management of Funds   266   

(a) The Managers’ initial budget is set out in Annex “C” hereto. Subsequent budgets shall be for twelve

   267   

month periods and shall be prepared by the Managers and presented to the Owners not less than three

   268   

months before the end of the budget year.

   269   

(b) The Owners shall state to the Managers in a timely manner, but in any event within one month of

   270   

presentation, whether or not they agree to each proposed annual budget. The parties shall negotiate in good

   271   

faith and if they fail to agree on the annual budget, including the management fee, either party may terminate

   272   

this Agreement in accordance with Sub-clause 22(e).

   273   

(c) Following the agreement of the budget, the Managers shall prepare and present to the Owners their

   274   

estimate of the working capital requirement for the Vessel and shall each month request the Owners in writing

   275   

to pay the funds required to run the Vessel for the ensuing month, including the payment of any occasional or

   276   

extraordinary item of expenditure, such as emergency repair costs, additional insurance premiums, bunkers

   277   

or provisions. Such funds shall be received by the Managers within ten running days after the receipt by the

   278   

Owners of the Managers’ written request and shall be held to the credit of the Owners in a separate bank

   279   

account.

   280   

(d) The Managers shall at all times maintain and keep true and correct accounts in respect of the Management

   281   

Services in accordance with the relevant International Financial Reporting Standards or such other standard

   282   

as the parties may agree, including records of all costs and expenditure incurred, and produce a comparison

   283   

between budgeted and actual income and expenditure of the Vessel in such form and at such intervals as

   284   

shall be mutually agreed.

   285   

The Managers shall make such accounts available for inspection and auditing by the Owners and/or their

   286   

representatives in the Managers’ offices or by electronic means, provided reasonable notice is given by the

   287   

Owners.

   288   

(e) Notwithstanding anything contained herein, the Managers shall in no circumstances be required to use

   289   

or commit their own funds to finance the provision of the Management Services.

   290   

 

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SECTION 5 – Legal, General and Duration of Agreement

 

 

14. Trading Restrictions   291   

If the Managers are providing crew management services accordance with Sub-clause 5(a) (Crew

   292   

Management), the Owners and the Managers will, prior to the commencement of this Agreement, agree on any

   293   

trading restrictions to the Vessel that may result from the terms and conditions of the Crew’s employment

   294   
15. Replacement   295   

If the Managers are providing crew management services in accordance with Sub-clause 5(a) (Crew

   296   

Management), the Owners may require the replacement, at their own expense, at the next reasonable

   297   

opportunity, of any member of the Crew found on reasonable grounds to be unsuitable for service. If the

   298   

Managers have failed to fulfil their obligations in providing suitable qualified Crew within the meaning of Sub-

   299   

clause 5(a) (Crew Management), then such replacement shall be at the Managers’ expense.

   300   
16. Managers’ Right to Sub-Contract   301   

The Managers shall not have the right to subcontract any of their obligations hereunder without the prior written

   302   

consent of the Owners which shall not be unreasonably withheld. In the event of such a sub-contract the Managers

   303   

shall remain fully liable for the due performance of their obligations under this Agreement.

   304   
17. Responsibilities   305   

(a) Force Majeure
  306   

Neither party shall be liable for any loss, damage or delay due to any of the following force majeure events

   307   

and/or conditions to the extent that the party invoking force majeure is prevented or hindered from

   308   

performing any or all of their obligations under this Agreement, provided they have made all

   309   

reasonable efforts to avoid, minimize or prevent the effect of such events and/or conditions:

   310   

(i)      acts of God;

   311   

(ii)     any Government requisition, control, intervention, requirement or interference;

   312   

(iii)    any circumstances arising out of war, threatened act of war or warlike operations, acts of terrorism,

   313   

sabotage or piracy, or the consequences thereof;

   314   

(iv)    riots, civil commotion, blockades or embargoes;

   315   

(v)     epidemics;

   316   

(vi)    earthquakes, landslides, floods or other extraordinary weather conditions;

   317   

(vii)    strikes, lockouts or other industrial action, unless limited to the employees (which shall not include the

   318   

Crew) of the party seeking to invoke force majeure;

   319   

(viii)  fire, accident, explosion except where caused by negligence of the party seeking to invoke force majeure;

   320   

and

   321   

(ix)    any other similar cause beyond the reasonable control of either party.

   322   

(b) Liability to Owners

   323   

(i)      Without prejudice to Sub-clause 17(a), the Managers shall be under no liability whatsoever to the Owners

   324   

for any loss, damage, delay or expense of whatsoever nature, whether direct or indirect, (including but

   325   

not limited to loss of profit arising out of or in connection with detention of or delay to the Vessel) and

   326   

howsoever arising in the course of performance of the Management Services UNLESS same is proved

   327   

to have resulted solely from the negligence, gross negligence or wilful default of the Managers or their

   328   

employees or agents, or sub-contractors employed by them in connection with the Vessel, in which case

   329   

(save where loss, damage, delay or expense has resulted from the Managers’ personal act or omission

   330   

committed with the intent to cause same or recklessly and with knowledge that such loss, damage,

   331   

delay or expense would probably result) the Managers’ liability for each incident or series of incidents

   332   

giving rise to a claim or claims shall never exceed a total of ten (10) times the annual management fee

   333   

payable hereunder.

   334   

(ii)     Acts or omissions of the Crew Notwithstanding anything that may appear to the contrary in this

   335   

 

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Agreement, the Managers shall not be liable for any acts or omissions of the Crew, even if such acts

   336   

or omissions are negligent, grossly negligent or wilful, except only to the extent that they are shown to

   337   

have resulted from a failure by the Managers to discharge their obligations under Clause 5(a) (Crew

   338   

Management), in which case their liability shall be limited in accordance with the terms of this Clause

   339   

17 (Responsibilities).

   340   

(c) Indemnity

   341   

Except to the extent and solely for the amount therein set out that the Managers would be liable under

   342   

Sub-clause 17(b), the Owners hereby undertake to keep the Managers and their employees,

   343   

agents and sub-contractors indemnified and to hold them harmless against all actions, proceedings, claims,

   344   

demands or liabilities whatsoever or howsoever arising which may be brought against them or incurred or

   345   

suffered by them arising out of or in connection with the performance of this Agreement, and against and in

   346   

respect of all costs, loss, damages and expenses (including legal costs and expenses on a full indemnity

   347   

basis) which the Managers may suffer or incur (either directly or indirectly) in the course of the performance

   348   

of this Agreement.

   349   

(d) “Himalaya”

   350   

It is hereby expressly agreed that no employee or agent of the Managers (including every

   351   

sub-contractor from time to time employed by the Managers) shall in any circumstances whatsoever be

   352   

under any liability whatsoever to the Owners for any loss, damage or delay of whatsoever kind arising or

   353   

resulting directly or indirectly from any act, neglect or default on his part while acting in the course of or in

   354   

connection with his employment and, without prejudice to the generality of the foregoing provisions in this

   355   

Clause 17 (Responsibilities), every exemption, limitation, condition and liberty herein contained and every

   356   

right, exemption from liability, defence and immunity of whatsoever nature applicable to the Managers or to

   357   

which the Managers are entitled hereunder shall also be available and shall extend to protect every such

   358   

employee or agent of the Managers acting as aforesaid and for the purpose of all the foregoing provisions

   359   

of this Clause 17 (Responsibilities) the Managers are or shall be deemed to be acting as agent or trustee

   360   

on behalf of and for the benefit of all persons who are or might be their servants or agents from time to time

   361   

(including sub-contractors as aforesaid) and all such persons shall to this extent be or be deemed to be

   362   

parties to this Agreement.

   363   

18. General Administration

   364   

(a) The Managers shall keep the Owners and, if appropriate, the Company informed in a timely manner of

   365   

any incident of which the Managers become aware which gives or may give rise to delay to the Vessel or

   366   

claims or disputes involving third parties.

   367   

(b) The Managers shall handle and settle all claims and disputes arising out of the Management Services

   368   

hereunder, unless the Owners instruct the Managers otherwise. The Managers shall keep the Owners

   369   

appropriately informed in a timely manner throughout the handling of such claims and disputes.

   370   

(c) The Owners may request the Managers to bring or defend other actions, suits or proceedings related

   371   

to the Management Services, on terms to be agreed.

   372   

(d) The Managers shall have power to obtain appropriate legal or technical or other outside expert advice in

   373   

relation to the handling and settlement of claims in relation to Sub-clauses 18(a) and 18(b) and disputes and

   374   

any other matters affecting the interests of the Owners in respect of the Vessel, unless the Owners instruct

   375   

the Managers otherwise.

   376   

(e) On giving reasonable notice, the Owners may request, and the Managers shall in a timely manner make

   377   

available, all documentation, information and records in respect of the matters covered by this Agreement

   378   

either related to mandatory rules or regulations or other obligations applying to the Owners in respect of

   379   

the Vessel (including but not limited to STCW 95, the ISM Code and ISPS Code) to the extent permitted by

   380   

relevant legislation.

   381   

On giving reasonable notice, the Managers may request, and the Owners shall in a timely manner make

   382   

available, all documentation, information and records reasonably required by the Managers to enable them

   383   

to perform the Management Services.

   384   

(f) The Owners shall arrange for the provision of any necessary guarantee bond or other security.

   385   

 

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(g) Any costs incurred by the Managers in carrying out their obligations according to this Clause 18 (General

   386   

Administration) shall be reimbursed by the Owners.

   387   
19. Inspection of Vessel   388   

The Owners may at any time after giving reasonable notice to the Managers inspect the Vessel for any reason

   389   

they consider necessary.

   390   
20. Compliance with Laws and Regulations   391   

The parties will not do or permit to be done anything which might cause any breach or infringement of the

   392   

laws and regulations of the Flag State, or of the places where the Vessel trades.

   393   
21. Duration of the Agreement   394   

(a) This Agreement shall come into effect at the date stated in Box 2 and shall continue until terminated by

   395   

either party by giving notice to the other; in which event this Agreement shall terminate upon the expiration

   396   

of the later of the number of months stated in Box 18 or a period of two (2) months from the date on which

   397   

such notice is received, unless terminated earlier in accordance with Clause 22 (Termination).

   398   

(b) Where the Vessel is not at a mutually convenient port or place on the expiry of such period, this Agreement

   399   

shall terminate on the subsequent arrival of the Vessel at the next mutually convenient port or place.

   400   
22. Termination   401   

(a) Owners’ or Managers’ default

   402   

If either party fails to meet their obligations under this Agreement, the other party may give notice to the

   403   

party in default requiring them to remedy it. In the event that the party in default fails to remedy it within a

   404   

reasonable time to the reasonable satisfaction of the other party, that party shall be entitled to terminate this

   405   

Agreement with immediate effect by giving notice to the party in default.

   406   

(b) Notwithstanding Sub-clause 22(a):

   407   

(i)      The Managers shall be entitled to terminate the Agreement with immediate effect by giving notice to the

   408   

Owners if any monies payable by the Owners and/or the owners of any associated vessel, details of

   409   

which are listed in Annex “D”, shall not have been received in the Managers’ nominated account within

   410   

ten days (10) of receipt by the Owners of the Managers’ written request, or if the Vessel is repossessed by

   411   

the Mortgagee(s).

   412   

(ii)     If the Owners proceed with the employment of or continue to employ the Vessel in the carriage of

   413   

contraband, blockade running, or in an unlawful trade, or on a voyage which in the reasonable opinion

   414   

of the Managers is unduly hazardous or improper, the Managers may give notice of the default to the

   415   

Owners, requiring them to remedy it as soon as practically possible. In the event that the Owners fail to

   416   

remedy it within a reasonable time to the satisfaction of the Managers, the Managers shall be entitled

   417   

to terminate the Agreement with immediate effect by notice.

   418   

(iii)    If either party fails to meet their respective obligations under Sub-clause 5(b) (Crew Insurances) and

   419   

Clause 10 (Insurance Policies), the other party may give notice to the party in default requiring them to

   420   

remedy it within ten (10) days, failing which the other party may terminate this Agreement with immediate

   421   

effect by giving notice to the party in default.

   422   

(c) Extraordinary Termination

   423   

This Agreement shall be deemed to be terminated in the case of the sale of the Vessel or, if the Vessel

   424   

becomes a total loss or is declared as a constructive or compromised or arranged total loss or is requisitioned

   425   

or has been declared missing or, if bareboat chartered, unless otherwise agreed, when the bareboat charter

   426   

comes to an end.

   427   

(d) For the purpose of Sub-clause 22(c) hereof:

   428   

(i) the date upon which the Vessel is to be treated as having been sold or otherwise disposed of shall be

   429   

the date on which the Vessel’s owners cease to be the registered owners of the Vessel;

   430   

(ii) the Vessel shall be deemed to be lost either when it has become an actual total loss or agreement has

   431   

been reached with the Vessel’s underwriters in respect of its constructive total loss or if such agreement

   432   

with the Vessel’s underwriters is not reached it is adjudged by a competent tribunal that a constructive

   433   

 

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loss of the Vessel has occurred; and

   434   

(iii)    the date upon which the Vessel is to be treated as declared missing shall be ten (10) days after the Vessel

   435   

was last reported or when the Vessel is recorded as missing by the Vessel’s underwriters, whichever

   436   

occurs first. A missing vessel shall be deemed lost in accordance with the provisions of Sub-clause 22(d)

   437   

(ii)

   438   

(e) In the event the parties fail to agree the annual budget in accordance with Sub-clause 13(b) or to agree

   439   

a change of flag in accordance with Sub-clause 9(d)(ii) or to agree to a reduction in the Mangement Fee in

   440   

accordance with Sub-clause 12(d), either party may terminate this Agreement by giving the other party not

   441   

less than one month’s notice, the result of which will be the expiry of the Agreement at the end of the current

   442   

budget period or on expiry of the notice period, whichever is the later.

   443   

(f) This Agreement shall terminate forthwith in the event of an order being made or resolution passed

   444   

for the winding up, dissolution, liquidation or bankruptcy of either party (otherwise than for the purpose of

   445   

reconstruction or amalgamation) or if a receiver or administrator is appointed, or if it suspends payment,

   446   

ceases to carry on business or makes any special arrangement or composition with its creditors.

   447   

(g) In the event of the termination of this Agreement for any reason other than default by the Managers the

   448   

management fee payable to the Managers according to the provisions of Clause 12 (Management Fee and

   449   

Expenses), shall continue to be payable for a further period of the number of months stated in Box 19 as

   450   

from the effective date of termination. If Box 19 is left blank then ninety (90) days shall apply.

   451   

(h) In addition, where the Managers provide Crew for the Vessel in accordance with Clause 5(a) (Crew

   452   

Management):

   453   

(i)      the Owners shall continue to pay Crew Support Costs during the said further period of the number of

   454   

months stated in Box 19; and

   455   

(ii)     the Owners shall pay an equitable proportion of any Severance Costs which may be incurred, not

   456   

exceeding the amount stated in Box 20. The Managers shall use their reasonable endeavours to minimise

   457   

such Severance Costs.

   458   

(i) On the termination, for whatever reason, of this Agreement, the Managers shall release to the Owners,

   459   

if so requested, the originals where possible, or otherwise certified copies, of all accounts and all documents

   460   

specifically relating to the Vessel and its operation.

   461   

(j) The termination of this Agreement shall be without prejudice to all rights accrued due between the parties

   462   

prior to the date of termination.

   463   
23. BIMCO Dispute Resolution Clause   464   

(a) This Agreement shall be governed by and construed in accordance with EnglishDanish law and any dispute

   465   

arising out of or in connection with this Agreement shall be referred to arbitration in LondonCopenhagen in accordance

   466   

with the Arbitration Act 1996Danish Institute of Arbitration in Copenhagen (Copenhagen Arbitration) or any statutory

   467   

modification or re-enactment thereof save to the extent necessary to give effect to the provisions of this Clause.

   468   

The arbitration shall be conducted in accordance with the London Maritime Arbitrators Association (LMAA)

   469   

Terms Rules of Procedure of Copenhagen Arbitration current at the time when the arbitration proceedings are

   470   

commenced.

The reference shall be to three arbitrators. A party wishing to refer a dispute to arbitration shall appoint its

   471   

arbitrator and send notice of such appointment in writing to the other party requiring the other party to appoint

   472   

its own arbitrator within 14 calendar days of that notice and stating that it will appoint its arbitrator as sole

   473   

arbitrator unless the other party appoints its own arbitrator and gives notice that it has done so within the

   474   

14 days specified. If the other party does not appoint its own arbitrator and give notice that it has done so

   475   

within the 14 days specified, the party referring a dispute to arbitration may, without the requirement of any

   476   

further prior notice to the other party, appoint its arbitrator as sole arbitrator and shall advise the other party

   477   

accordingly. The award of a sole arbitrator shall be binding on both parties as if he had been appointed by

   478   

agreement.

   479   

Nothing herein shall prevent the parties agreeing in writing to vary these provisions to provide for the

   480   

 

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appointment of a sole arbitrator.

   481   

In cases where neither the claim nor any counterclaim exceeds the sum of USD50,000 (or such other sum

   482   

as the parties may agree) the arbitration shall be conducted in accordance with the LMAA Small Claims

   483   

Procedure current at the time when the arbitration proceedings are commenced.

   484   

(b) This Agreement shall be governed by and construed in accordance with Title 9 of the United States Code

   485   

and the Maritime Law of the United States and any dispute arising out of or in connection with this Agreement

   486   

shall be referred to three persons at New York, one to be appointed by each of the parties hereto, and the

   487   

third by the two so chosen, their decision or that of any two of them shall be final, and for the purposes of

   488   

enforcing any award, judgment may be entered on an award by any court of competent jurisdiction. The

   489   

proceedings shall be conducted in accordance with the rules of the Society of Maritime Arbitrators, Inc.

   490   

In cases where neither the claim nor any counterclaim exceeds the sum of USD50,000 (or such other sum

   491   

as the parties may agree) the arbitration shall be conducted in accordance with the Shortened Arbitration

   492   

Procedure of the Society of Maritime Arbitrators, Inc. current at the time when the arbitration proceedings

   493   

are commenced.

   494   

(c) This Agreement shall be governed by and construed in accordance with the laws of the place mutually

   495   

agreed by the parties and any dispute arising out of or in connection with this Agreement shall be referred

   496   

to arbitration at a mutually agreed place, subject to the procedures applicable there.

   497   

(d) Notwithstanding Sub-clauses 23(a), 23(b) or 23(c) above, the parties may agree at any time to refer to

   498   

mediation any difference and/or dispute arising out of or in connection with this Agreement.

   499   

(i)      In the case of a dispute in respect of which arbitration has been commenced under Sub-clauses 23(a);

   500   

23(b) or 23(c) above, the following shall apply:

   501   

(ii)     Either party may at any time and from time to time elect to refer the dispute or part of the dispute to

   502   

mediation by service on the other party of a written notice (the “Mediation Notice”) calling on the other

   503   

party to agree to mediation.

   504   

(iii)    The other party shall thereupon within 14 calendar days of receipt of the Mediation Notice confirm that

   505   

they agree to mediation, in which case the parties shall thereafter agree a mediator within a further 14

   506   

calendar days, failing which on the application of either party a mediator will be appointed promptly by

   507   

the Arbitration Tribunal (“the Tribunal”) or such person as the Tribunal may designate for that purpose.

   508   

The mediation shall be conducted in such place and in accordance with such procedure and on such

   509   

terms as the parties may agree or, in the event of disagreement, as may be set by the mediator.

   510   

(iv)    If the other party does not agree to mediate, that fact may be brought to the attention of the Tribunal

   511   

and may be taken into account by the Tribunal when allocating the costs of the arbitration as between

   512   

the parties.

   513   

(v)     The mediation shall not affect the right of either party to seek such relief or take such steps as it considers

   514   

necessary to protect its interest.

   515   

(vi)    Either party may advise the Tribunal that they have agreed to mediation. The arbitration procedure shall

   516   

continue during the conduct of the mediation but the Tribunal may take the mediation timetable into

   517   

account when setting the timetable for steps in the arbitration.

   518   

(vii)    Unless otherwise agreed or specified in the mediation terms, each party shall bear its own costs incurred

   519   

in the mediation and the parties shall share equally the mediator’s costs and expenses.

   520   

(viii)  The mediation process shall be without prejudice and confidential and no information or documents

   521   

disclosed during it shall be revealed to the Tribunal except to the extent that they are disclosable under

   522   

the law and procedure governing the arbitration.

   523   

(Note: The parties should be aware that the mediation process may not necessarily interrupt time limits.)

   524   

(e) If Box 21 in Part I is not appropriately filled in, Sub-clause 23(a) of this Clause shall apply.

   525   

Note: Sub-clauses 23(a), 23(b) and 23(c) are alternatives; indicate alternative agreed in Box 21. Sub-clause

   526   

 

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23(d) shall apply in all cases.

   527   
24. Notices   528   

(a) All notices given by either party or their agents to the other party or their agents in accordance with the

   529   

provisions of this Agreement shall be in writing and shall, unless specifically provided in this Agreement to

   530   

the contrary, be sent to the address for that other party as set out in Boxes 22 and 23 or as appropriate or

   531   

to such other address as the other party may designate in writing.

   532   

A notice may be sent by registered or recorded mail, facsimile, electronically or delivered by hand in accordance

   533   

with this Sub-clause 24(a)

  534   

(b) Any notice given under this Agreement shall take effect on receipt by the other party and shall be deemed

   535   

to have been received:

   536   

(i)      if posted, on the seventh (7th) day after posting;

   537   

(ii)     if sent by facsimile or electronically, on the day of transmission; and

   538   

(iii)    if delivered by hand, on the day of delivery.

   539   

And in each case proof of posting, handing in or transmission shall be proof that notice has been given,

   540   

unless proven to the contrary.

   541   
25. Entire Agreement   542   

This Agreement constitutes the entire agreement between the parties and no promise, undertaking,

   543   

representation, warranty or statement by either party prior to the date stated in Box 2 shall affect this

   544   

Agreement. Any modification of this Agreement shall not be of any effect unless in writing signed by or on

   545   

behalf of the parties.

   546   
26. Third Party Rights   547   

Except to the extent provided in Sub-clauses 17(c) (Indemnity) and 17(d) (Himalaya), no third parties may

   548   

enforce any term of this Agreement.

   549   
27. Partial Validity   550   

If any provision of this Agreement is or becomes or is held by any arbitrator or other competent body to be

   551   

illegal, invalid or unenforceable in any respect under any law or jurisdiction, the provision shall be deemed

   552   

to be amended to the extent necessary to avoid such illegality, invalidity or unenforceability, or, if such

   553   

amendment is not possible, the provision shall be deemed to be deleted from this Agreement to the extent

   554   

of such illegality, invalidity or unenforceability, and the remaining provisions shall continue in full force and

   555   

effect and shall not in any way be affected or impaired thereby.

   556   
28. Interpretation   557   

In this Agreement:

   558   

(a) Singular/Plural

   559   

The singular includes the plural and vice versa as the context admits or requires.

   560   

(b) Headings

   561   

The index and headings to the clauses and appendices to this Agreement are for convenience only and shall not affect

   562   

its construction or interpretation.

   563   

(c) Day

   564   

“Day” means a calendar day unless expressly stated to the contrary.

   565   
29. BIMCO MLC Clause for SHIPMAN 2009 For the purposes of this Clause:

“MLC” means the International Labour Organisation (ILO) Maritime Labour Convention (MLC 2006) and any amendment thereto or substitution thereof.

“Shipowner shall mean the party named as “shipowner” on the Maritime Labour Certificate for the Vessel.

(a) Subject to Clause 3 (Authority of the Managers), the Managers shall, to the extent of their Management Services, assume the Shipowner’s duties and responsibilities imposed by the MLC for the Vessel, on behalf of the Shipowner.

 

14

PART II

SHIPMAN 2009

Standard ship management agreement

 

(b) The Owners shall ensure compliance with the MLC in respect of any crew members supplied by them or on their behalf.

(c) The Owners shall procure, whether by instructing the Managers under Clause 7 (Insurance Arrangements) orotherwise, insurance cover or financial security to satisfy the Shipowners financial security obligations under the MLC.

 

15

Addendum number 1 to the Standard Ship Management Agreement dated 13.05.2014

With effect from May 1st 2015 KNOT Management Denmark A/S and KNOT Shuttle Tankers 21 AS have agreed to adjust the management fee and a New Box 14 have been agreed to be:

USD 46,080 (to be increased by 4 per cent annually, first time from January 1st 2016).

Copenhagen/Haugesund, March 19th 2015

/s/ Trygve Seglem

KNOT Shuttle Tankers 21 AS

Owners

By Director Trygve Seglem

/s/ Karl Gerhard Bråstein Dahl

KNOT Management Denmark A/S

Managers

By Chairman of the Board Karl Gerhard Bråstein Dahl