1. GENERAL
1. When was FSL Trust incorporated?
2. When was FSL Trust's Initial Public Offering (IPO) and what was the offering price?
3. Who are the Sponsor and the Trustee-Manager of FSL Trust?
4. Who are the major unitholders of FSL Trust?
5. How do I buy FSL Trust's units?
6. When does FSL Trust's fiscal year end?
7. How can I obtain information on FSL Trust's latest results?


2. BUSINESS TRUSTS
1. What are business trusts?
2. How are business trusts different from traditional listed companies?
3. How are business trusts different from Real Estate Investment Trust (REITs)?
4. Why is FSL Trust an attractive investment choice?


3. BUSINESS MODEL/TAX BENEFITS
1. How is FSL Trust different from a shipping company?
2. How is FSL Trust exposed to the cyclical risks of the shipping industry?
3. Is FSL Trust affected by the current downturn in the shipping industry?
4. How do falling prices for shipping vessels affect FSL Trust?
5. How is FSL Trust different from other shipping trusts in the market?
6. Why should shipping operators choose FSL Trust?
7. What is FSL Trust's business/growth strategy?
8. Will FSL Trust take advantage of depressed vessel prices to acquire assets for subsequent sale when the market improves?
9. What tax benefits does FSL Trust enjoy?


4. CAPITAL STRUCTURE
1. Please explain the capital structure for FSL Trust.
2. What is FSL Trust's target debt-to-equity ratio?
3. How can FSL Trust fund future acquisitions when it has reached its target of 1:1 debt-to-equity?
4. FSL Trust returns much of its leasing revenue less related expenses to unitholders. How will FSL Trust pay back bank loans used to purchase the ships?
5. How is FSL Trust able to refinance the loans using existing vessels as collateral even though they depreciate in value over time?
6. What is the average interest rate paid by FSL Trust for its credit facilities?
7. What are the covenants attached to FSL Trust's loans?
8. What is the present fair market value of the portfolio's vessels and how does this compare against the amount that FSL Trust has borrowed?
9. FSL Trust's lenders invoked a market disruption clause (“MDC”) in October 2008. Can you explain what the MDC is?
10. Has the MDC been invoked for the first quarter of 2009?
11. Will the MDC be invoked again in future?
12. Is FSL Trust in discussion with its Lenders to restructure its loans?


5. DISTRIBUTION / TAX ON UNITHOLDERS
1. What is the distribution policy for FSL Trust?
2. How is the Net Distributable Amount determined?
3. How does FSL Trust grow its Distribution Per Unit (DPU)?
4. What is FSL Trust's distribution history?
5. Are distributions taxable?
6. Are the DPU amounts guaranteed?
7. Can you explain the distribution process?
8. When will ex-distribution dates be announced?
9. How do I find out how much distributions have been declared by FSL Trust?
10. How do I know if I am entitled to distributions as a unitholder?


6. UNITS
1. Why is P/E a poor measure of value for shipping trusts? What is the common valuation matrix used to benchmark business/shipping trusts?
2. How is distribution yield per unit calculated?
3. Why did the company change its trading currency from US$ to S$ in November 2007?
4. Is there a lock up period for the shares held by the Sponsor?
5. What is the current free float for FSL Trust?
6. How many FSL Trust units are currently in issue?


7. FINANCIALS
1. What were FSL Trust's most recent financial results?
2. How often does FSL Trust release its financial results?
3. How does FSL Trust depreciate the vessels it owns?
4. How is the residual value further depreciated when a lessee extends the lease term upon expiry of the base lease term?
5. What is residual value and how is it determined for each vessel?
6. Is the residual value also the scrap value?
7. What is the typical useful life of a vessel?
8. How does earnings per unit impact distribution per unit (DPU)?
9. Why do we see declining profits each quarter?
10. How much revenue has FSL Trust secured on long-term contracts?


8. RISK MANAGEMENT
1. What is the biggest risk to the business of FSL Trust?
2. What does FSL Trust do to manage its credit risk?
3. Are FSL Trust's cash flows and vessels' lease rates strongly correlated to shipping cycles?
4. In light of the current difficult conditions for shipping lines, what is the risk of a lessee defaulting on its lease payments?
5. How does the Trust manage foreign exchange and interest rate risks?
6. How are the vessels insured?
7. What happens if a lessee defaults in its lease payment?


9. VESSELS & LEASES
1. Please explain the terms of the purchase options available for vessels' lessees at the end of a base lease term. Are the vessel purchase options available to lessees pegged to market price or fixed in value?
2. How are the lease rates for FSL Trust determined? Are lease rates subject to any adjustments?
3. Are vessel lessees allowed to re-negotiate lease rates before expiry of lease terms?
4. Please explain the 'Hell & High Water' clause in your lease contracts.
5. How does the Trustee-Manager make sure vessels are kept in good condition by the lessees?
6. What happens to a vessel at the end of the base lease term?
7. What is the revenue breakdown by lessee and vessel type?
8. What is the average age of vessels in the FSL Trust portfolio?
9. What is the average remaining lease period for the vessels?
10. What types and how many vessels does FSL Trust own?
11. Who are FSL Trust's customers?


10. TRUSTEE-MANAGER'S FEES
1. What are the fees payable to the Trustee-Manager?
2. Please explain the concept of DAU used to calculate the management incentive fee?


11. ADRS & INTERNATIONAL OTCQX
1. What is an ADR?
2. Which ADR program has FSL Trust established?
3. In what currency are the ADRs be quoted?
4. What is International OTCQX^SM?
5. Which other companies have their ADRs quoted on International OTCQX?
6. Where can I find more information on the ADRs and OTCQX?
7. How would FSL Trust benefit from ADR program and its quotation on OTCQX?
8. Is the ADR quotation on OTCQX considered another listing for FSL Trust?
9. Is this a capital raising exercise?
10. When did FSL Trust's ADRs commence trading on OTCQX?
11. Does the quotation of the ADRs on OTCQX dilute my current unit holding in FSL Trust?
12. How can I track the share price and volume of FSL Trust's ADRs?
13. Are ADR holders eligible to receive distributions from FSL Trust? How will they receive their distributions?
14. Do ADR holders receive notices of distributions and annual reports?
15. How would a U.S. investor benefit from trading ADRs on OTCQX as compared to trading directly on the Singapore Exchange (SGX) through a U.S. brokerage?


12. DISTRIBUTION REINVESTMENT SCHEME
1. What are the objectives of the Distribution Reinvestment Scheme?
2. Is the Scheme applicable every quarter?
3. Are all unitholders eligible to participate in the Scheme?
4. How do I participate in the Scheme?
5. What happens if I do nothing?
6. Is FSL Trust using this Scheme to raise capital?
7. How would FSL Trust use the retained cash, which would otherwise have been paid as distribution?
8. What are the benefits of the Scheme to unitholders?
9. Will my holding be diluted if I choose not to participate in the Scheme?
10. What is the cost to me as a Unitholder if I elect to receive my distribution in new units?
11. When will I know the issue price of the New Units that will be issued in lieu of the cash distributions?
12. On what basis will the Board decide on the quantum of the discount to be applied to the price of the new units?
13. Will the implementation of this Scheme affect the DPU level in the future given that there will be more units issued?
14. Can I choose to receive my distribution partially in units and with the remainder in cash?
15. How do I deal with odd-lots that I may get if I participate in the Scheme for a particular distribution?
16. What if I have a fractional unit (e.g. 0.7 unit) as a result of the new units issue under the Scheme?
17. Are holders of FSL Trust ADRs eligible to participate in the Scheme?
18. Will the Sponsor and the substantial unitholders participate in the Scheme?
19. How can I calculate the number of units I will receive in lieu of cash distribution?
20. What is the sequence of events if the Scheme is applicable for a particular quarterly distribution?
21. If I elect to receive new units for one distribution, can I decide to receive cash instead for the subsequent distribution?
22. Am I able to permanently register to receive new units under the Scheme or do I have to make an election every quarter?
23. Is there a minimum level of participation required in terms of new units to be issued for the Scheme to be applicable in any one quarter?
24. If the response to the Scheme is poor, i.e. many Unitholders elect to receive cash, will the Trustee-Manager suspend the Scheme?
25. If the Scheme is implemented, does it mean that no fund raising activity will be needed?
26. How is this Scheme different from rights or bonus issues?


13. DISTRIBUTION POLICY FOR 2009
1. Why has the Board revised the distribution policy for FSL Trust?
2. What happens to the balance of the distributable cash that is not paid out?
3. The projected DPU of US2.45¢ for 1Q FY09 represents 75% to 80% of expected distributable cash flow. Can we expect a similar payout ratio for the rest of FY09?
4. How will the distribution policy change in 2010?
5. How will a reduced DPU affect the incentive fee paid to the Trustee-Manager?
6. What would be the yield for the projected DPU of US2.45¢ in 1Q FY09?


14. CONTACT INFORMATION
1. Who can I contact for further information on FSL Trust?
2. How do I get on your mailing list?

Important Notes: These FAQs may contain forward-looking statements that involve risks and uncertainties. Actual future performance, outcomes and results may differ materially from those expressed in forward-looking statements as a result of a number of risks, uncertainties and assumptions. Representative examples of these factors include (without limitation) general industry and economic conditions, interest rate trends, cost of capital and capital availability, competition from other companies, changes in operating expenses, trust expenses and governmental and public policy changes and the continued availability of financing in the amounts and the terms necessary to support future business. Investors are cautioned not to place undue reliance on these forward-looking statements, which are based on current view of management on future events.

The initial public offering of units of First Ship Lease Trust (the "Offering") commenced on 19 March 2007 and closed on 22 March 2007. In the Offering, Deutsche Bank AG, Singapore Branch was the Sole Global Co-ordinator, Joint Lead Manager and Joint Bookrunner, and J.P. Morgan (S.E.A.) Limited was the Joint Lead Manager and Joint Bookrunner. The Co-Lead Managers to the Offering were CLSA Merchant Bankers Limited and Macquarie Securities (Asia) Pte Limited. The Manager and Co-ordinator of the Singapore Public Offer was Oversea-Chinese Banking Corporation Limited.

K. ADRS & INTERNATIONAL OTCQX

A Depositary Receipt (DR) is a tradable instrument that represents ownership of equity shares in a foreign issuer. The DRs trading in the U.S. are called American Depositary Receipts (ADRs). Each issued DR represents a certain number of the underlying ordinary shares of the issuer, with such underlying shares held in custody by a depository institution (e.g. Bank of New York Mellon). The ADRs are considered U.S. domestic securities, making it easier for U.S. investors to invest in non-U.S. companies.

FSL Trust has established a Level 1 ADR program. The Level 1 ADR program has minimal SEC registration requirements and no requirement for Sarbanes-Oxley compliance.

The ADRs will be quoted in U.S. dollars.

• OTCQX is the premier market tier for non-U.S. companies that trade over-the-counter and are listed on qualified foreign stock exchanges. OTCQX provides an efficient platform for non-U.S. listed companies to access the U.S. markets.
• There are two tiers for OTCQXSM, namely PrimeQXSM and PremierQXSM tiers, and registration under the PrimeQXSM tier will allow non-U.S. companies access to the U.S. capital markets without the associated costs and burdens of a traditional U.S. exchange listing and compliance to the SEC and Sarbanes-Oxley requirements.

International companies which have their ADRs quoted on International OTCQX include Marks & Spencer, Roche, BASF, Adidas Group, Akzo Nobel and Air France-KLM. A more detailed list can be found on OTCQX website at http://www.otcqx.com/otcqx/securityList.

You can find out more about OTCQX and ADR at http://www.otcqx.com and www.adr.com respectively. However, FSL Trust bears no responsibility for the content posted on these sites.

• The ADRs are considered U.S. domestic securities. Hence the ADR program makes it easier for U.S. investors to invest in FSL Trust, particularly institutional investors restricted to investing in only U.S.-based securities. Over time, we expect the ADR program to improve FSL Trust's trading liquidity and expand its base of unitholders. The ADR program is also expected to enhance FSL Trust's ability to obtain research coverage among sell-side analysts based in the United States.
• International OTCQX is well recognized among the U.S. investment community, which helps to distinguish FSL Trust's ADR program from the approximately 8,000 OTC securities currently traded in the United States.

No. The ADR quotation on OTCQX will complement FSL Trust's core listing on the Singapore Exchange (SGX) by making it easier for U.S. investors to invest in FSL Trust.

No. This is not a capital raising exercise as there is no issuance of new units.

FSL Trust's ADRs commenced trading on OTCQX on 29 October 2008.

No. The proposed quotation of FSL Trust's ADRs on OTCQX is non-dilutive for existing unitholders as no new or additional units are issued. Each ADR is represented by 10 underlying FSL Trust units listed on the Singapore Exchange (SGX-ST).

Upon commencement of the ADR quotation on OTCQX, investors can go to the OTCQX website at http://www.otcqx.com to obtain the ADR quotation and related trading statistics.

Yes. ADR holders will receive their distributions (less relevant fees) from the Bank of New York Mellon subject to the terms of the Deposit Agreement (which sets out the terms for the establishment of the ADR program).

ADR holders may refer to FSL Trust's website at www.firstshipleasetrust.com for notices of distributions and annual reports and may also sign up at the same website for email alerts.

Many institutional investors in the U.S. are restricted from purchasing shares or units in companies that do not trade in the U.S. By effectively addressing this issue, OTCQX will significantly increase the opportunity among high-quality, U.S.-based investors to purchase units in FSL Trust.