Knightsbridge Tankers Limited has secured medium-term time charter contracts for two of the company's five very large crude carriers (VLCCs). The company has chartered the vessels to Tankers International LLC, each for a period of three years at a rate of $30,000 per day with a 50:50 profit sharing arrangement for earnings in excess of $30,000 per day calculated by reference to the BITR Index. Tankers International LLC is a pool for the commercial operations of four large tanker owners and operators: A.P. Moller, Euronav Luxembourg SA., Overseas Shipholding Group, Inc and Reederei "Nord" Klaus E. Oldendorff. The two time charters will commence prior to April 30, 2004.
In June 2003, Knightsbridge received notice that Shell International has chosen not to renew the existing bareboat charters for any of the Company's five VLCCs for a second seven year period. Consequently, all five VLCCs will be redelivered to the Company during late February and March 2004. In September 2003, at a Special General Meeting of Shareholders, the shareholders voted to continue the Company in business. Since that time the Company has been evaluating the alternatives available with respect to future employment of the VLCCs. The Company has now fixed three of its five VLCCs on medium or long-term charters. The Company expects the remaining two vessels to trade initially on the spot market on redelivery from Shell International although it will continue to evaluate market opportunities and employment options that may become available.