TIME CHARTER CONTRACT

(Contract No. ____________)

____________________________

KNOW ALL MEN BY THESE PRESENTS:

This Charter Contract is made and entered into this __________________________, in

the City of Cebu, Philippines, by and between:

A. PARTIES

OWNER
Name FANRONG SHIPPING CORP.
Address 55 P. Remedio Street, Banilad, Mandaue City, Cebu, Philippines
Representative Alan C. Go, General Manager

CHARTERER
Name ANIMO MARINE HAULERS & SHIP MANAGEMENT COPORATION
Address 11B-24 Francesca Towers, EDSA corner Scout Borromeo St., Quezon
City
Representative Noel Pagaduan, Chairman

B. THE CHARTER

Name of Vessel MTKR “Andrina 200”

Type of Vessel Tanker
Year Built 2016
Place Built Sangat, San Fernando, Cebu
Class Orient Register of Shipping, Inc.
LOA 76.20 meters
Breadth 11.50 meters
Depth 6.43 meters
Gross Tonnage 650.00 tons
Net Tonnage 430.00 tons
Main Engines Hanshin
Home Port Cebu City
Insured Value Hull and Machinery @ P130,000,000.00/P & I @ U$D1,000,000,000.00
Period 3 months
Start of Charter June 22, 2017
End of Charter September 29, 2017
Charter Hire P------------- inclusive of VAT
Due Date 5th day of every month
Home Port Cebu City
Cargo Black product

C. TERMS AND CONDITIONS

1. Delivery and Redelivery of the Vessel

1.1. Within forty-eight (48) hours after the execution of this Contract and after the receipt by
the OWNER of the charter fee, the VESSEL shall be delivered and taken over by the
CHARTERER at Navotas Fishport Anchorage.

1.2. Within twenty four (24) hours after the execution of this Contract, the charterer’s
representative together with the owner’s representative will conduct a joint sounding of
the actual fuel onboard the vessel. Fuel quantities on delivery / redelivery to be about the
same, excess on the quantity on redelivery will be on the account of the OWNER and
shall be paid to the CHARTERER. Fuel prices to be based on wholesale posted prices
prevailing during delivery and redelivery of the vessel.
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1.3. The OWNER shall, before and at the time of the delivery of the VESSEL, exercise due
diligence to make the VESSEL seaworthy and, in every respect, ready in hull,
machinery, and equipment for service under thus Charter. The VESSEL shall also be
properly documented at the time of the delivery.

1.4. Within forty-eight (48) hours after the expiration of the Charter, the CHARTERER shall
return the VESSEL to the OWNER to Navotas Fishport Anchorage.

1.5. Should the VESSEL be in the middle of a voyage and the completion of the voyage
would go beyond the date of expiration of the Charter, the CHARTERER shall be
allowed to complete the sojourn. The CHARTERER shall return the VESSEL to the
OWNER within forty-eight (48) hours after completion of the voyage. In addition, the
CHARTERER shall be bound to pay a charter hire pro-rated for the day in excess of the
period of this contract. Under no circumstances shall the continued possession and/or
use of VESSEL without the execution of a new Charter Contract be interpreted as
consent of the OWNER to the renewal of extension of the charter.

1.6. The CHARTERER hereby agrees to pay the OWNER the monthly charter hire in the
amount and at the due date as stated in Section B.

1.7. Upon the execution of this Contract, the CHARTERER shall pay to the OWNER an
advance charter hire equivalent to one (1) month. This advance charter hire shall be
applied to the first month of the Charter.

1.8. Billing us 30 days after acceptance of the vessel.

2. Delay in the Charter Hire

2.1. Time shall be of the essence in the payment of the charter hire. Without prejudice to the
exercise and enforcement of other rights and remedies provided in this Contract and
applicable laws, the CHARTERER shall be liable to pay, by way of penalty, interest at
the rate of Three Percent (3%) per month, compounded monthly, on any charter hire not
paid on due date. The computation of interest shall commence on the 6 th day of the
month, and shall be compounded monthly until the delinquency is fully settled.

3. Detailed Description and Performance

3.1 OWNER guarantees that the fuel consumption of the VESSEL shall be as follows:

Laden Ballast
Steaming
Main Engine : ___liters/hr ___liters/hr
Auxiliary Engine 1 : ___liters/hr ___liters/hr
Auxiliary Engine 2 : ___liters/hr ___liters/hr
Harbor Generator : ___liters/hr ___liters/hr

Maneuvering
Main Engine : ___liters/hr ___liters/hr
Auxiliary Engine 1 : ___liters/hr ___liters/hr
Auxiliary Engine 2 : ___liters/hr ___liters/hr
Harbor Generator : ___liters/hr ___liters/hr

At Loadport
Main Engine : ___liters/hr ___liters/hr
Auxiliary Engine 1 : ___liters/hr ___liters/hr
Auxiliary Engine 2 : ___liters/hr ___liters/hr
Harbor Generator : ___liters/hr ___liters/hr
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At Discharge Port
Main Engine : ___liters/hr ___liters/hr
Auxiliary Engine 1 : ___liters/hr ___liters/hr
Auxiliary Engine 2 : ___liters/hr ___liters/hr
Harbor Generator : ___liters/hr ___liters/hr

The services speed of the VESSEL is ___ knots in laden and ___ knots in ballast and in
the absence CHARTERER’S order to the contrary the VESSEL shall proceed at the
service speed. CHARTERER’s shall not order the VESSEL to sail at any speed, which in
the opinion of the Chief Engineer would be injurious to the main engine.
For the purpose of this Charter the guaranteed speed at any time shall be then current
ordered speed or the service speed, as the case maybe.

Any consumption in excess of the guaranteed fuel consumption will be for the account of
the OWNERS and shall be deducted from the charter hire. On the other hand, any
unconsumed fuel especially those resulting from unmet guaranteed fuel consumption will
always belong to the CHARTERER.

4. Subletting

4.1. CHARTERER’S MAY SUB-LET THE vessel, with the OWNERS’ prior formal permission
but shall always remain responsible to the OWNERS for due fulfillment of this charter.

5. Limitations of the Charter

5.1. The Charter shall be subject to the following limitations:

a. The whole reach, burden, and decks of the VESSEL, including its engines, shall be
subject to the use and disposal of the CHARTERER, reserving proper and sufficient
space for the VESSEL’s Master, officers, crew, equipment, accessories, provisions,
and stores;

b. The VESSEL shall be used solely as a tanker and shall only transport the cargo as
stated in Section B of this Contract;

c. The VESSEL shall not be employed in any trade or business that is illegal or be used
in carrying illegal or prohibited goods or deployed in any manner as to render her
subject to condemnation, destruction, seizure or confiscation;

d. The VESSEL shall only be used in conformity with the terms or instruments of its
insurance, including any express or implied warranties;

e. The name of the VESSEL shall be retained by the CHARTERER;

f. Under no circumstances shall the VESSEL be overloaded, and the displacement of

the VESSEL shall not exceed her load line as approved by the MARINA, the
Philippine Coast Guard, and any other government agency or office;

g. The VESSEL’s main engine shall not be operated continuously in excess of Eight
Five Percent (85%) of its total Brake Horsepower (BHP);

h. The VESSEL shall be operated only within Philippine Territorial Waters

i. In loading the VESSEL, the CHARTERER shall maintain the load-line mark within the
tropical summer; freeboard with proper lashing, shoring, and securing of all relevant
cargo.

5.2. Any violation of the preceding limitations shall be considered a breach of this Contract
and is a ground for its pre-termination or cancellation without need of recourse to judicial
process.
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6. Vessel Survey

6.1 The OWNER and the CHARTERER shall appoint a common surveyor for the purpose of
determining and agreeing in writing the condition of the VESSEL at the time of delivery
and redelivery.

6.2. Prior to the delivery of the VESSEL to the CHARTERER, a JOINT ON-HIRE survey shall
be conducted at the expense of both the OWNER and CHARTERER. During the ON-
HIRE survey, a complete inventory of the VESSEL’s entire equipment, outfit, and of all
consumable stores on board the VESSEL shall be made by both the CHARTERER and
the OWNER.

6.3. At the time of the delivery of the VESSEL, the CHARTERER agrees to the relevant
condition of the VESSEL including the equipment, accessories, remaining diesel fuel,
lubrication oil and hydraulic oil as per result of the joint on-hire survey. This relevant
condition shall be referred to elsewhere in this Contract as the “delivery condition” of the
VESSEL, and the CHARTERER is bound to redeliver or return the VESSEL in this
“delivery condition.”

6.4. After redelivery of the VESSEL to the OWNER, a JOINT OFF-HIRE survey shall likewise
be conducted at the expense of both the OWNER and the CHARTERER in order to
determine whether the VESSEL is in its “delivery condition”.

6.5. In the event that the VESSEL as redelivered is not in “delivery condition”, the OWNER
shall have the option of either having the CHARTERER, at its own cost, undertake the
restoration of the VESSEL to such condition or engaging a third party to do the task with
the costs to be charged to the CHARTERER.

7. Owner’s Rights and Responsibilities

7.1. The OWNER shall:

a. Provide the full complement of Master, officers, and crew for the vessel and shall be
responsible for their subsistence, salaries, and benefits;

b. Be responsible and pay for the maintenance and repair of the vessel and all dues
and charges directly related to the vessel’s registration;

c. Provide and pay for the lube oil and potable or fresh water for the VESSEL for the
duration of this Contract;

d. Procure and pay the necessary insurance premiums and fees for the hull and
machinery of the vessel, cargo liability, and protection and indemnity; and

e. Ensure the peaceful possession and use by the CHARTERER of the VESSEL during
the duration of the charter provided no breach has been committed by the
CHARTERER.

7.2. The OWNER also warrants that:

a. The VESSEL is fully operational and in seaworthy condition;

b. The VESSEL has all the certifications and vessel documents as required by the
MARINA, the Philippine Coast Guard, and any other government agency or office for
its operation;

c. The VESSEL is fully equipped and fitted with navigational safety equipment such as
but not limited to RADAR, GPS, NAVTEX, VHF, SSB and required safety, distress,
and firefighting equipment and devices, all of which are in good working condition;
and
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d. The VESSEL’s Master, officers, and crew are duly qualified and have all the
certifications and licenses as required by the MARINA, the Philippine Coast Guard,
and any other government agency or office to operate, navigate, and manage the
VESSEL.

7.3. The OWNER shall have the right to pre-terminate or cancel this Contract and the charter
prior to its expiration and repossess the VESSEL without need of recourse to judicial
process or intervention of any court or quasi-judicial or government agency in the event
the CHARTERER commits a breach of any of the provisions of this Contract such as but
not limited to the non-payment of the charter hire, the mismanagement of the VESSEL,
and generally the failure of the CHARTERER to perform its obligations under this
Contract. This right to pre-terminate or cancel and repossess shall be without prejudice
to other remedies that the OWNER may decide to avail of either under this Contract or
under applicable laws.

8. Charterer’s Responsibilities

8.1. The CHARTERER shall:

a. Faithfully comply with the limitations of the Charter under Section C, Paragraph 4;

b. Provide for the fuel, oil, water, and other needed supplies for the VESSEL’s use and
operation during the Charter, except the lube oil and water which shall be for the
OWNER’s account;

c. CHARTERER will pay for the tank cleaning cost. Accredited tank cleaner must issue
the certificate of fitness to load white product.

d. Pay all charges, fees, and expenses essential or incidental to the VESSEL’s
operation, such as but not limited to the port charges, pilotage fees, berthing fees,
any taxes and charges imposed by both local and national governments, surveys on
hatches, expenses for the inspection or for whatever official action undertaken by
authority boards, and quarantine expenses (including fumigation and disinfection);

e. Maintain the cleanliness and appearance of the entire VESSEL;

f. Operate and maintain the VESSEL in accordance with MARINA rules and
regulations and other applicable national or local laws and with the extraordinary
diligence of a common carrier;

g. Dock the VESSEL in a port of discharge where there is a safe ground for anchoring
or where the VESSEL can berth safely, always afloat or where vessels of similar size
and draft can idle in safety; and

h. Generally perform all other acts consistent with its legal duties as a common carrier.

8.2. The failure on the part of the CHARTERER to perform these obligations shall be
considered by the OWNER a substantial breach of this Contract. In such instance, the
OWNER shall always have the option to pre-terminate this Contract and repossess the
VESSEL without need of recourse to judicial process or the intervention of any court or
quasi-judicial or government agency.

9. Liability, Non-Lien, and Indemnity

9.1. The CHARTERER shall be responsible for all the acts and omissions of the Master,
officers, crew or agents, passengers and any and all other persons allowed to board the
VESSEL. The CHARTERER shall indemnify and hold harmless the OWNER against all
actions, suits, damages, and claims that may arise from the acts and omissions of these
persons.
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9.2. The CHARTERER shall likewise indemnify the OWNER against all liabilities arising from
the acts of the Master, officers, or crew of the VESSEL or agents of the CHARTERER in
the performance or non-performance of their respective duties and functions and in
complying with such orders of the MARINA, the Philippine Coast Guard, or any other
government agency or office as well as from any irregularity in the VESSEL’s operation.

9.3. The CHARTERER shall further hold the OWNER harmless and free from any shortage,
mixture, marks, or damage to or claims caused by the acts, omissions, or negligence of
the Master, officers and crew of the VESSEL and from any claims or demands for non-
payment by the CHARTERER of any applicable taxes, port charges, fees, and other
expenses essential or incidental to the operation of the VESSEL.

9.4. The CHARTERER assumes full responsibility for any loss or damage which may be
caused to the person or property of third persons and further binds itself to hold the
OWNER harmless and free from any such claims or demands for injury or damage. If
ever the OWNER is made to pay for any demands or claims that rightly pertain to the
CHARTERER, then the former shall have the right to claim immediate reimbursement
from the latter upon more presentation of proof of payment of such demands or claims.

9.5. The CHARTERER shall indemnify and hold the OWNER harmless against any lien
arising upon the VESSEL during the period of this Charter while she is under the control
of the CHARTERER, and against any claims against the OWNER arising out of or in
relation to the operation of the VESSEL by the CHARTERER. Should the VESSEL be
seized by reason of claims or liens arising out of her operation by the CHARTERER, the
latter, at its own expense, shall take all reasonable steps to secure that within a period of
ten (10) days, the VESSEL is released and put up a bond or any security to secure her
release.

9.6. In the event that any act or omission of the CHARTERER, the Master, officers and crew
of the VESSEL shall vitiate, cancel, or otherwise adversely affect the insurance covering
the VESSEL, the CHARTERER shall pay to the OWNER all losses and indemnify the
OWNER against all claims and demands which would otherwise have been covered by
such insurance.

9.7. The CHARTERER will not suffer, nor permit to be continued, any lien or encumbrance
incurred by it or their agents, which might have priority over the title and interest of the
OWNER in the VESSEL.

10. Allowed Liens

10.1. The OWNER shall have a lien on all cargoes for all amounts due to it under this Charter.

11. Inspection of Vessel

11.1. The OWNER or its representative shall have the right at any time to inspect or survey
the VESSEL or instruct a duly authorized surveyor to carry out such survey on its behalf
to ascertain the condition of the VESSEL and satisfy itself that the VESSEL is properly
operated.

11.2. The CHARTERER shall also permit the OWNER to inspect the VESSEL’s logbooks
whenever requested and shall, whenever so required, furnish the latter with full
information regarding any casualties or other accidents or damage in the VESSEL.

12. No Suspension of Hire

12.1. During the duration of this Charter, there shall be no suspension of hire, unless upon the
instance of the OWNER.
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13. Salvage

13.1. All benefits from salvage and assistance to other vessels shall be shared equally by the
OWNER and CHARTERER after deducting the share of the Master and the crew as well
as expenses, such as but not limited to the charter hire paid under this Contract for time
lost in the salvage, repairs for damage suffered, and the cost of fuel and provisions. The
CHARTERER shall be bound by all measures taken by the OWNER to fix the amount of
salvage and to secure payment for it.

14. Wreck Removal

14.1. In the event of the VESSEL becoming a wreck or obstruction to navigation, the
CHARTERER shall indemnify the OWNER against any sums which the latter shall
become liable to pay and shall pay in consequence of such event.

15. General Average

15.1. General Average, if any, shall be settled according to the York-Antwerp Rules or any
subsequent modification or amendment thereof current at the time of the casualty, and
as to matters not covered by such Rules, according to the laws, customs, usages, and
practices of the Philippines.

16. Abandonment and Loss of Vessel

16.1. If during the Charter, the VESSEL shall be abandoned or in any manner neglected by
the CHARTERER as to adversely affect its operation and seaworthiness, the OWNER
shall have the right to immediately take over and repossess the VESSEL without need of
recourse to judicial process or intervention of any court or government agency or quasi-
judicial body. The OWNER shall then consider the CHARTERER to have committed a
breach of this Contract and avail of all remedies as provided here and under applicable
laws. However, despite the fact that the CHARTERER has abandoned the VESSEL, it
is still bound to pay the charter hire for the entire duration of the Charter.

16.2. In the event that the VESSEL becomes an actual, constructive, compromised or agreed
total loss, the Charter shall be deemed terminated as of the date of such loss. In the
event of a constructive total loss, the Charter shall be deemed to have ended from the
date of the event giving rise to such loss. If the date of the loss cannot be ascertained or
if the VESSEL is missing, the Charter shall cease from the date the VESSEL was last
reported. Any charter hire paid in advance shall be returned accordingly.

17. Insurance, Protection and Indemnity of the Vessel

17.1. The VESSEL shall be covered by hull and machinery and cargo liability insurance and
Protection and Indemnity (P and I) policy by an insurance and P&I company chosen by
the OWNER.

18. Default and Breach

18.1. If default or breach be made on any of the terms and conditions of this Charter, then the
OWNER may exercise the following rights:

a. Terminate and cancel this Charter;

b. Forfeit the charter hire so far paid;

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c. Immediately take over and repossess the VESSEL without need of court action or
order or recourse to any judicial process or intervention of any court, government
agency or quasi-judicial body;

d. Collect the charter hire for the remaining period of the Charter; and

e. Show and charter the VESSEL to other prospective charterers.

18.2. The CHARTERER further holds the OWNER harmless and free from any claims or
demands for any loss, injury or damage, either by the former or third persons, which may
arise from the taking over and the repossession of the VESSEL.

18.3. The CHARTERER shall be liable for all damages, actual and consequential resulting
from any breach or default or the termination of this Contract.

18.4. Should the OWNER be compelled to seek the assistance of a lawyer to enforce any of
the terms and conditions of this Contract, the CHARTERER shall, in addition to the
damages elsewhere mentioned in this Contract, pay an equivalent of Thirty Percent
(30%) of the amount and damages due and collectible, but in no case less than One
Hundred Thousand Pesos (P100,000.00), as attorney’s fees, aside from costs of
litigation and other expenses that the law or rules or regulations may entitle the OWNER
to recover from the CHARTERER.

18.5. The provisions of this paragraph shall be without prejudice to whatever remedies the
OWNER might avail of including but not limited to the collection of the unpaid charter
hire and penalties. Hence, all the rights and remedies granted to the OWNER under this
Contract or elsewhere are considered cumulative. Lastly, the OWNER, in exercising its
rights as mentioned in this article, shall not incur any civil or criminal liability.

19. Inclusion of Relevant Clauses

19.1. This Contract, upon its execution, shall include the new Jason Clause as well as the
Both-To-Blame collision clause, which are both to be included in all bills of lading issued
hereunder. All legal fees arising from the enforcement of these clauses shall be for the
account of the CHARTERER.

19.2. As used in this Contract, the aforesaid clauses shall mean as follows:

a) Jason Clause states that the cargo owners are obligated to contribute in general
average in cases of danger, damage, or disaster resulting from faults or errors in
navigation or management of vessel, her machinery or appurtenances, provided
that the shipowner shall have exercised due diligence to make the vessel in all
respects seaworthy, and to have her properly manned, equipped, and supplied.

b) Both-to-Blame Collision Clause states that if the vessel comes into collision with
another ship as a result of the negligence of the other ship and any act, neglect
or default of the Master, mariner, pilot or the servants of the Carrier in the
navigation or in the management of the ship, the owners of the goods carried
hereunder will indemnify the Carrier against all loss or liability to the other or non-
carrying ship or her owners in so far as such loss or liability represents loss of, or
damage to, or any claim whatsoever of the owners of said goods, paid or payable
by the other or non-carrying ship or her owners or to the owners of said goods
and set off, recouped, or recovered by the other or non-carrying ship or her
owners as part of their claim against the carrying ship or carrier.

20. Assignment and Sub-Demise

20.1. The character and qualifications of the CHARTERER and limitations of this Charter are
the special considerations and the inducement for this Contract. Thus, the
CHARTERER shall not assign, transfer, or convey, in whole or in part its rights in this
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Contract or under this Charter, and neither shall it sub-demise, lease, mortgage, or in
any way encumber any or all part of the VESSEL without the prior written consent of the
OWNER.

21. Miscellaneous Provisions

21.1. The parties warrant that their respective representatives have been duly authorized to
enter into and execute this Contract.

21.2. This Contract may not be amended, modified, or otherwise altered except in writing and
signed by the party bound or burdened by such amendment or modification.

21.3. The failure of the OWNER to insist upon the strict performance of any of the terms and
conditions of this Charter shall not be deemed a relinquishment or waiver of the rights or
remedies that the OWNER may have, nor shall it be construed a waiver of any
subsequent breach or default of the terms and conditions, which shall continue to be in
full force and effect. No waiver by the OWNER of any of its rights under this Charter
shall be deemed to have been made unless so expressed in writing and signed under
oath by the OWNER.

21.4. Invalidation of any of the stipulations of this Contract by judgment or order of a

competent court shall not affect the other provisions, which shall remain in full force and
effect.

21.5. All the terms and conditions contained in this Contract constitute the entire agreement
between the parties and is deemed to include any and all representations, promises, and
commitments made by the parties, verbal or otherwise, prior to its execution. The
parties shall not be bound by representations, promises, and commitments not
contained or expressly provided in this Contract.

21.6. All suits or actions arising out of this Contract and other matters directly or indirectly
related to it shall be instituted in the competent courts or administrative or quasi-judicial
bodies of the City of Cebu to the exclusion and express waiver of all other courts or
administrative or quasi-judicial bodies elsewhere situated.

IN WITNESS WHEREOF, the Parties sign this Contract on the date and place first
mentioned above.

OWNER CHARTERER

FANRONG SHIPPING CORPORATION ANIMO MARINE HAULERS & SHIP

MANAGEMENT CORPORATION

By: By:

LESLEY MAE G. SIA NOEL PAGADUAN

President Chairman

Signed in the Presence Of:

________________________ ___________________________
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ACKNOWLEDGMENT

REPUBLIC OF THE PHILIPPINES }

ss

CITY OF CEBU. . . . . . . . . . . . . . .

BEFORE ME, a Notary Public for and in the City of Cebu, on this
_______________________, personally appeared the following individuals who presented to me
sufficient identification consisting of the following:

Name CTC No. & Gov’t ID Date & Place Issued

LESLEY MAE G. SIA 26488740/SSS Id no. 06-2701868-2 01/16/17/Cebu City

NOEL PAGADUAN

all known to me and to me known to be the same persons who executed the foregoing Time Charter
Contract, and they acknowledged to me that the same is their free act as well as of the entities they
have been authorized to represent. The foregoing Charter Contract, consisting of ten (10) pages
inclusive of this Acknowledgment page, pertains to the charter of the MTKR “Andrina 200” and has
been signed by the parties and the witnesses on every page.

WITNESS MY HAND AND NOTARIAL SEAL on the date and the place above stated.

Doc. No. _____;

Page No._____;
Book No._____;
Series of 2017