Common use of Additional Default Rights Clause in Contracts

Additional Default Rights. Without prejudice to Charterer’s other remedies under this Charter or otherwise, in the event that Owner repeatedly fails to maintain and operate the Vessel in accordance with the requirements of this Charter, such as being Off-Hire for substantial periods or failing to perform voyages, loadings, and discharges in accordance with the performance warranties to a degree that such failure, if continued, would result in a material breach of Owner’s obligation under this Charter and such failure is not cured to the satisfaction of Charterer within ***** days of Charterer’s notifying Owner of such failure, then (subject to section 23.1(c)) Charterer shall have the right to require Owner to replace the Manager of the Vessel with another Manager that is satisfactory to the Charterer. Any increase in operating costs shall be for Owner’s account and Hire will continue to be paid by Charterer in accordance with the terms hereof, excluding such increase. Alternatively, at Charterer’s election, Charterer on giving not less than ***** days’ notice to Owner, shall have the right to convert this Charter into a bareboat charter for a term equal to the then unexpired portion of the Term and to appoint a technical shipmanager of Charterer’s choice (subject to such shipmanager having experience in the operation of LNG tankers and to the approval of such appointment by Owner, such approval not to be unreasonably withheld) to provide crew and to manage the Vessel. Such bareboat charter shall be on the terms of BARECON “89”, amended as appropriate, but shall provide that: (a) bareboat charterhire shall be payable in the amount of the then Financial Cost Component, and the Additional Cost Component of Hire, reduced by any reasonable additional costs incurred by Charterer as a result of Charter operating the Vessel in excess of the Operating Cost Component of Hire applicable from time to time during such period; (b) the insurance of the Vessel shall continue to be arranged by Owner in accordance with the requirements of Schedule IV to this Charter; provided that Charterer shall reimburse Owner for the cost of the Compulsory Insurances; and (c) in the event that Owner fails to make timely payment of premium or calls relating to the insurances, or the Vessel shall cease for any reason to be validly and properly insured as required by Schedule IV to this Charter, then Charterer may take over the responsibility of paying for and arranging the insurances on the Vessel, which shall continue to meet all of the requirements of Schedule IV to this Charter except as may be required to reflect the interests of the Owner as owner of the Vessel, the interests under any Permitted Encumbrances, and interests of the Charterer as bareboat charterer of the Vessel, with responsibility for repairs and navigation of the Vessel and the interests of the shipmanager appointed by Charterer to manage the Vessel.

Additional Default Rights. Without prejudice to Charterer’s other remedies under this Charter or otherwise, in the event that Owner repeatedly fails to maintain and operate the Vessel in accordance with the requirements of this Charter, such as being Off-Hire for substantial periods or failing to perform voyages, loadings, and discharges in accordance with the performance warranties to a degree that such failure, if continued, would result in a material breach of Owner’s obligation under this Charter and such failure is not cured to the satisfaction of Charterer within ***** days of Charterer’s notifying Owner of such failure, then (subject to section 23.1(c)) Charterer shall have the right to require Owner to replace the Manager of the Vessel with another Manager that is satisfactory to the Charterer. Any increase in operating costs shall be for Owner’s account and Hire will continue to be paid by Charterer in accordance with the terms hereof, excluding such increase. Alternatively, at Charterer’s election, Charterer on giving not less than ***** days’ notice to Owner, shall have the right to convert this Charter into a bareboat charter for a term equal to the then unexpired portion of the Term and to appoint a technical shipmanager of Charterer’s choice (subject to such shipmanager having experience in the operation of LNG tankers and to the approval of such appointment by Owner, such approval not to be unreasonably withheld) to provide crew and to manage the Vessel. Such bareboat charter shall be on the terms of BARECON “892001”, amended as appropriate, but shall provide that: (a) bareboat charterhire shall be payable in the amount of the then Financial Cost Component, and the Additional Cost Component of Hire, reduced by any reasonable additional costs incurred by Charterer as a result of Charter operating the Vessel in excess of the Operating Cost Component of Hire applicable from time to time during such period; (b) the insurance of the Vessel shall continue to be arranged by Owner in accordance with the requirements of Schedule IV to this Charter; provided that Charterer shall reimburse Owner for the cost of the Compulsory Insurances; and (c) in the event that Owner fails to make timely payment of premium or calls relating to the insurances, or the Vessel shall cease for any reason to be validly and properly insured as required by Schedule IV to this Charter, then Charterer may take over the responsibility of paying for and arranging the insurances on the Vessel, which shall continue to meet all of the requirements of Schedule IV to this Charter except as may be required to reflect the interests of the Owner as owner of the Vessel, the interests under any Permitted Encumbrances, and interests of the Charterer as bareboat charterer of the Vessel, with responsibility for repairs and navigation of the Vessel and the interests of the shipmanager appointed by Charterer to manage the Vessel.