GENERAL TERMS/CONDITIONS OF
SALE AND DELIVERY

This contract is made by and between SKYGROUP LOGISTICS LIMITED hereinafter named as the Seller, and each buyer, hereinafter named as the Customer, to confirm the agreement on the following:

1. Subject of the Contract

The Seller shall undertake for charge to ensure sale and delivery (hereinafter: “bunkering”) of marine petroleum products (hereinafter: “bunker products”) to the Customer’s vessels in accordance with bunker nomination considered as integral part of the present Contract.

2. Bunker order and nomination

The bunker order shall be submitted by the Customer not later than 48 hours prior to delivery, specifying the name of the vessel, port of bunkering, grade and quantity of bunker products, delivery date, local agent.

If the Seller is able to fulfill bunkering indicated in Customer’s bunker order he will send by fax or e-mail bunker nomination stating all main terms/conditions of bunkering including price and terms of payment. The Customer has to confirm bunker nomination by fax or e-mail and from this moment the deal to be considered as concluded.

3. Conditions of supply

Supply of the Ship’s Stores is carried out by the Supplier in accordance with the Nomination. Supply should be made by the Supplier within the dates specified in the Nomination, but in any event before departure of the ship from the port.

In accordance with amendments to Russian Federation Customs Legislation Customer shall provide Supplier the following documents for ship stores customs clearance on RF boarder from September 1st 2008: For inward customs clearance:

а) Written application from ship administration (master) specifying the following data:

- Ship name and nationality;

- Purpose of arrival on RF customs territory;

- Person designated by Customer for ship stores supply;

- Ship tanks for stores acceptance and storage;

- Quantity of ship stores available on board as of the moment of arrival in port as declared by master in inward ship stores declaration;

- Quantity of ship stores required for ship operation;

- Port of departure and planned route of the ship upon departure from Russian Federation territory.

b) Ship Stores Declaration certified by customs authority of ship inward clearance. For outward customs clearance of ship leaving Russian Federation customs territory:

c) Ship Stores Declaration certified by customs authority of ship outward clearance.

The date of supply is considered the date of execution of the bunkering receipt and/or other documents which confirm the fact of loading of the Ship’s Stores on board the ship.

Supplied Ship’s Stores must not consume in the Russian Territorial Waters.

Customer is responsible to provide for Supplier by original of Ship’s Store declaration which is confirmation of removal of Ship’s Store out of Russian Territorial Waters. Ship’s Store declaration should have the check of Custom authorities about removal of Ship’s Store out of Russian Territorial Waters and signed/stamped by the Custom representative.

4. Quality and quantity of bunker products

The Seller guarantees that the quality of bunker products correspond with specification settled in bunker nomination. Two reference samples to be drown onboard of delivery barge and to be sealed and signed by representatives from both supplier and vessel.

Quality of bunker supplied to be determined by analysis of the sealed reference sample in presence of representatives of both Seller and Customer. Ship’s tank samples, if any, will not be considered.

Quantity of bunker products supplied to be determined by measuring procedures at delivery barge before and after bunkering in presence of representative of the vessel. Ship’s tank figures will not be considered.

In case of disagreement of supplied bunker quantity the vessel have to return full received volume of bunker products to the delivery barge up to figures measured before bunkering.

There is a limit of seven days from the date of delivery for notification of claim relating to quality and quantity of bunker products.

5. Title and risk

Title and risk on bunker product shall pass from the Seller to the Customer since the product passed the vessel’s permanent flange connected with delivery barge.

6. Payment terms

The Customer has to effect payment for supplied bunker products within 30 (thirty) calendar days (if another period not settled in bunker nomination) from delivery date in USD by wire transfer to the bank details indicated in Seller’s invoice received by fax or e-mail.

7. Penalties

In case the delivery was not effected or delayed due to the Seller’s fault the Seller shall pay to the Customer all losses confirmed by appropriate documents.

In case of non-fulfilment by the Seller quality obligation of bunker products under clause 3 of this Contract the Seller is obliged to compensate to the Customer all losses caused by improper quality of delivered bunker products.

In case of payment delay the Customer has to pay to the Seller an interest fee at the rate of 0.1 percent per day from the cost of delivered products.

If the Customer will refuse bunkering after bunker nomination was already confirmed the Customer has to pay to the Seller the penalty in amount of USD3.00 per each ordered ton of bunker products.

If the Customer will change the quantity of bunker products after custom clearance was already done the Customer has to pay to the Sellers the penalty in amount of USD300.00.

In case of delivery barge will be delayed by the vessel due to impossibility to accept bunker products with the rate more than 50 (fifty) m/tons per hour the Customer has to pay to the Seller the demurrage in the amount USD50.00 per hour upon receipt by fax or e-mail calculation of demurrage. This term not applied if total quantity of bunker product not exceeds 150 mt.

Vessel should pass outward formalities and custom clearance at port of bunkering / supplied and declared petroleum products should be used only outside of Russian Federation. Otherwise for total quantity / shortage 18% VAT will be added to the amount of invoice.

Please be informed that it is the customer’s responsibility to provide suppliers original of Ship store declaration which must be duly signed and stamped by the vessels representative. 3 (three) copies of originals of Ships store declaration have to be presented to customs authorities by the vessel. One original of Ships store must be retained by the vessel, one original of Ships store must be retained by the customs authorities and one original of Ships store must be retained by the supplier. In case of non-fulfillment of it requirement we reserve our right to claim V.A.T amount.

8. Liens

The Product is supplied upon the faith and credit of the Vessel. It is agreed and acknowledged that a lien over the Vessel is thereby for the Price of Bunker Product supplied and that the Seller in agreed to deliver Bunker Product to the Vessel does so relying upon the faith and credit of the Vessel. The Customer if is not the Owner of the Vessel hereby expressly warrants that he has the authority of the owner to pledge the Vessel’s credit as aforesaid and that he has given notice of the provisions of this Clause to the owner. The Seller shall not be bound by any attempt by any person to restrict, limit or prohibit its lien or liens attaching to a Vessel unless notice in writing of the same is given to the Seller before it sends its Confirmation to the Customer.

9. Force Majeure

If either party is unable by force majeure to perform or comply fully or in part with any obligation or condition of this contract, upon that party’s written notice of such force the other party within forty eight hours such performance or compliance shall be suspended during the continuance of the inability so caused and such party be relieved of liability and shall suffer no prejudice for failure to perform the same during such period. In the case that the said period of performance suspension shall continue in excess of thirty calendar days, this contract may at the option of the Customer, be cancelled without liability of either party. As used herein, the term “force majeure” shall include as an example and is not limited by fire, wars of belligerent action, riots or commotions, acts of God, navigation accident, vessels damage or loss, accidents at or closing of navigation, strikes, grievances or actions by or among workers or other cause reasonably beyond the control of the respective parties.

10. Other conditions

This Contract is operative as from the day of its singing by both parties and will be valid for one year. If, one month before the expiration of the above period of time, neither party notifies in writing of its desire to terminate this Contract or to alter its terms and conditions, the Contract is automatically extended for 12 (twelve) months.

All amendments and addendums to the present Contract are valid only if they are made in written form and signed by both parties.

All disputes arising in connection with present Contract to be settled in amicable way.

Arbitration, if any, in Hong Kong. English law to be applied.