Safety, Quality and Maintenance

We hold the health and safety of our crew and the environment in very high regard. Since incorporation, our Company has maintained a good safety record for our owned vessels which have not been involved in any accidents. While chartering-in the vessels, we endeavor to deal with reputable parties to achieve high levels of safety and maintenance. Our employees are well trained in all the required safety and environmental management systems and procedures and are provided with training in excess of the mandatory requirements. We adhere to the IMO’s aim of achieving "safe shipping across cleaner oceans."

We seek to keep our vessels in good working condition in order to satisfy the international operating standards required by our customers, as well as to prolong the useful lives of our vessels. We carry out regular maintenance on our fleet, including a mandatory annual survey of each of our vessels (which takes them out of service for about two to three days on average) and a mandatory survey every 30 months (which takes about two to three weeks on an average).

Crew members are responsible for carrying out routine maintenance onboard the vessels and where necessary additional crew members are added to perform specific maintenance and upgrading tasks during voyages.

Environmental Management

We are required to comply with all the environmental measures for each vessel as prescribed by the various regulatory authorities.

Our third party Ship Management Company has a Health Safety and Environment policy which has been approved by us. Our technical managers also have an approved manual which lists procedures which are designed to ensure compliance with various regulations, as well as to enhance our commitment to safety of life, ship, cargo and the environment. All vessels have the mandatory and approved pollution prevention manual on board.

In addition, we are in the process of implementing a Planned Maintenance System, or PMS, onboard each of our vessels, according to which all equipment on board is checked and routinely maintained as prescribed by the manufacturers and good industry practices.

We believe that our insurance coverage will be adequate to protect us against unanticipated accident-related risks involved in the conduct of our business and we will maintain appropriate levels of environmental damage and pollution insurance coverage, consistent with standard industry practice.

Insurance

In accordance with standard industry practice, we carry "Hull and Machinery," and "Protection and Indemnity" insurances to protect against the majority of the accident-related risks involved in the conduct of our marine operations. We also carry insurances covering "War Risks" (including piracy and terrorism) for our vessels. We typically arrange insurance on a fleet-wide basis. We also insure against third party risks, including environmental risks.

We intend to maintain insurance coverage adequate for our marine operations and to actively monitor any new regulations and threats that may require us to revise our coverage. We have not made any claims under our insurance policies to date.

Since the terrorist attacks of September 11, 2001, there have been a variety of initiatives in the United States, the European Union and elsewhere intended to enhance vessel security. In December 2002, amendments to the IMO’s International Convention for Safety of Life at Sea, or SOLAS, created a new chapter of the convention dealing specifically with maritime security. The new chapter went into effect in July 2004 and imposes various detailed security obligations on vessels and port authorities, most of which are contained in the newly created IMO’s International Ship and Port Facilities Security Code, or ISPS Code.