Common use of Project Operation Clause in Contracts

Project Operation. The Company will, and will cause Bossa Nova Spirit (as of and following the First Funding Date and with respect to the Bossa Nova Spirit Vessel) and Sertanejo Spirit (as of and following the Second Funding Date and with respect to the Sertanejo Spirit Vessel) to: (a) operate, maintain and preserve each Vessel and all of their other Properties necessary or useful in the proper conduct of its business in good working order and in such condition that each Vessel will have the capacity and functional ability to (i) perform, on a continuing basis (ordinary wear and tear excepted), in normal commercial operation, the functions for which it was specifically designed in accordance with the relevant Project Documents and Shipbuilding Contract at substantially the levels contemplated thereby and (ii) maintain the classification contemplated by Section 9.10(d) or with such other classification society that is acceptable to the Collateral Agent (acting reasonably and upon the recommendation of the Independent Engineer); (b) maintain all permits and certificates required for the operation of each Vessel; (c) to the extent that the Manager is an Affiliate of the Company, cause the Manager to undertake to operate, service, maintain and repair each Vessel so that the condition and operating efficiency thereof will be maintained and preserved (ordinary wear and tear excepted) in all material respects in accordance and compliance with (i) Good Utility Practices, (ii) such operating standards as shall be required to enforce any material warranty claims against dealers, manufacturers, vendors, contractors, and sub-contractors, (iii) the terms and conditions of all insurance policies maintained with respect to each Vessel at any time and (iv) the terms and conditions of the relevant Project Documents; (d) take such steps as are reasonably practicable to ensure that each Vessel and its constituent parts will be safe and without risk to health, safety or the environment when properly used; (e) cause the management of each Vessel to be carried out at all times by the Manager (including an Affiliate of Teekay or a Replacement Project Participant as specified in the definition of “Manager”); (f) promptly pay any tolls, dues, premia, fees and other outgoings whatsoever in respect of the Vessels and the insurance policies required by it to be maintained hereunder; and (g) promptly deliver to the Collateral Agent any notices of default under the relevant Charter Agreement.

Project Operation. The Company will, and will cause Bossa Nova Spirit (as of and following the First Funding Date and with respect to the Bossa Nova Spirit Vessel) and Sertanejo Spirit (as of and following the Second Funding Date and with respect to the Sertanejo Spirit Vessel) to: (a) operate, maintain and preserve each the Vessel and all of their its other Properties necessary or useful in the proper conduct of its business in good working order and in such condition that each the Vessel will have the capacity and functional ability to (i) perform, on a continuing basis (ordinary wear and tear excepted), in normal commercial operation, the functions for which it was specifically designed in accordance with the relevant Project Documents and Shipbuilding Contract at substantially the levels contemplated thereby and (ii) maintain the classification contemplated by Section 9.10(d) 4.17 or with such other classification society that is reasonably acceptable to the Collateral Agent (Agent, acting reasonably and upon the recommendation of the Independent Engineer); (b) maintain all permits and certificates required for the operation of each the Vessel; (c) to the extent that the Manager is an Affiliate of the Company, cause the Manager to undertake to operate, service, maintain and repair each the Vessel so that the condition and operating efficiency thereof will be maintained and preserved (ordinary wear and tear excepted) in all material respects in accordance and compliance with (i) Good Utility Practices, (ii) such operating standards as shall be required to enforce any material warranty claims against dealers, manufacturers, vendors, contractors, and sub-contractors, (iii) the terms and conditions of all insurance policies maintained with respect to each the Vessel at any time and (iv) the terms and conditions of the relevant Project Documents; (d) take such steps as are reasonably practicable to ensure that each the Vessel and its constituent parts will be safe and without risk to health, safety or the environment when properly used; (e) cause the management of each the Vessel to be carried out at all times by (i) the Manager Manager, (including ii) an Affiliate of Teekay or (iii) a Replacement Project Participant as specified ship management company or companies of international standing and experienced in the definition operation of “Manager”)LNG vessels, such company or companies to be acceptable to Charterer and approved by the Collateral Agent, such approval not to be unreasonably withheld or delayed; (f) promptly pay any tolls, dues, premia, fees and other outgoings whatsoever in respect of the Vessels Vessel and the insurance policies required by it to be maintained hereunder; and (g) promptly deliver to the Collateral Agent any notices of default under the relevant Charter AgreementCharter.