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                                                                                Exhibit
10.1
 
 
 
 
 
CREDIT AGREEMENT

among

 
GENCO SHIPPING & TRADING LIMITED,
 
VARIOUS LENDERS,
 
 
DNB NOR BANK ASA, NEW YORK BRANCH,

as Administrative Agent and Collateral Agent

and

DNB NOR BANK ASA, NEW YORK BRANCH,

as Mandated Lead Arranger and Bookrunner

 
__________________________________

 
Dated as of July 20, 2007
__________________________________
 
 
 

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SECTION 1.
 
AMOUNT AND TERMS OF CREDIT FACILITIES
   
2
   
1.01
 
The Commitments
   
2
   
1.02
 
Minimum Amount of Each Borrowing; Limitation on Number of Borrowings
   
2
   
1.03
 
Notice of Borrowing
   
2
   
1.04
 
Disbursement of Funds
   
3
   
1.05
 
Notes
   
3
   
1.06
 
Pro Rata Borrowings
   
4
   
1.07
 
Interest
   
4
   
1.08
 
Interest Periods
   
5
   
1.09
 
Increased Costs, Illegality, etc
   
6
   
1.10
 
Compensation
   
8
   
1.11
 
Change of Lending Office
   
9
   
1.12
 
Replacement of Lenders
   
9
               
SECTION 2.
 
LETTERS OF CREDIT
   
10
   
2.01
 
Letters of Credit
   
10
   
2.02
 
Letter of Credit Requests; Minimum Stated Amount
   
11
   
2.03
 
Letter of Credit Participations
   
11
   
2.04
 
Agreement to Repay Letter of Credit Drawings
   
13
   
2.05
 
Increased Costs
   
14
               
SECTION 3.
 
COMMITMENT COMMISSION; REDUCTIONS OF COMMITMENT
   
15
   
3.01
 
Commitment Commission; Fees
   
15
   
3.02
 
Voluntary Termination of Unutilized Commitments
   
16
   
3.03
 
Mandatory Reduction of Commitments
   
16
   
3.04
 
Scheduled Repayments and Commitment Reductions
   
17
               
SECTION 4.
 
PREPAYMENTS; PAYMENTS; TAXES
   
17
   
4.01
 
Voluntary Prepayments
   
17
   
4.02
 
Mandatory Repayments
   
18
   
4.03
 
Application of Net Cash Flows
   
19
   
4.04
 
Method and Place of Payment
   
19
   
4.05
 
Net Payments; Taxes
   
19
               
SECTION 5.
 
CONDITIONS PRECEDENT TO THE INITIAL BORROWING DATE
   
21
   
5.01
 
Existing Credit Agreement
   
21
   
5.02
 
Revolving Credit Agreement
   
21
 

 
 
 

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5.03
 
Assignments of Purchase Contracts and Escrow Deposit
   
21
   
5.04
 
Opinions of Counsel
   
21
   
5.05
 
Corporate Documents; Proceedings; etc
   
21
   
5.06
 
Subsidiaries Guaranty
   
22
   
5.07
 
Pledge and Security Agreement
   
22
   
5.08
 
Solvency Certificate
   
22
   
5.09
 
Approvals
   
22
   
5.10
 
Litigation
   
23
   
5.11
 
Material Adverse Effect
   
23
   
5.12
 
Environmental Laws
   
23
   
5.13
 
Fees
   
23
   
5.14
 
No Conflicts
   
23
               
SECTION 6.
 
CONDITIONS PRECEDENT TO THE REFINANCING LOAN
   
23
   
6.01
 
Subsidiary Guarantors
   
23
   
6.02
 
Repayment of Outstanding Indebtedness
   
24
   
6.03
 
Opinions of Counsel
   
24
   
6.04
 
Litigation
   
24
   
6.05
 
Material Adverse Effect
   
24
               
SECTION 7.
 
CONDITIONS SUBSEQUENT TO THE EFFECTIVE DATE
   
24
   
7.01
 
Opinions of Counsel
   
24
   
7.02
 
Corporate Documents; Proceedings; etc
   
25
   
7.03
 
Pledge and Security Agreement
   
26
   
7.04
 
Assignments of Earnings, Insurances and Charter
   
26
   
7.05
 
Control Agreement
   
26
   
7.06
 
Mortgages
   
27
   
7.07
 
Certificates of Ownership; Searches; Class Certificates; Appraisal Reports;
Mortgages
   
27
   
7.08
 
Management and Service Agreements
   
27
   
7.09
 
Environmental Laws
   
28
               
SECTION 8.
 
CONDITIONS PRECEDENT
   
28
   
8.01
 
Conditions Precedent to all Credit Events
   
28
   
8.02
 
Conditions Precedent to all Vessel Acquisition Loans
   
29
   
8.03
 
Conditions Precedent to the initial Loan for Pre-Delivery Installments of
Additional Newbuilding Vessels (Other than Capesize Vessels)
   
32
   
8.04
 
Conditions Precedent to all Loans in Respect of Deposits Under Purchase
Agreements for Additional Vessels Other than Capesize Vessels
   
34
 

 
 
(ii)
 
 

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SECTION 9.
 
REPRESENTATIONS, WARRANTIES AND AGREEMENTS
   
36
   
9.01
 
Corporate/Limited Liability Company/Limited Partnership Status
   
36
   
9.02
 
Corporate Power and Authority
   
36
   
9.03
 
No Violation
   
36
   
9.04
 
Governmental Approvals
   
37
   
9.05
 
Financial Statements; Financial Condition; Undisclosed Liabilities
   
37
   
9.06
 
Litigation
   
38
   
9.07
 
True and Complete Disclosure
   
38
   
9.08
 
Use of Proceeds; Margin Regulations
   
38
   
9.09
 
Tax Returns and Payments
   
39
   
9.10
 
Compliance with ERISA
   
39
   
9.11
 
The Security Documents
   
40
   
9.12
 
Representations and Warranties in Documents
   
41
   
9.13
 
Subsidiaries
   
41
   
9.14
 
Compliance with Statutes, etc
   
41
   
9.15
 
Investment Company Act
   
41
   
9.16
 
Pollution and Other Regulations
   
41
   
9.17
 
Labor Relations
   
42
   
9.18
 
Patents, Licenses, Franchises and Formulas
   
42
   
9.19
 
Indebtedness
   
42
   
9.20
 
Insurance
   
42
   
9.21
 
Concerning the Vessels
   
42
   
9.22
 
Citizenship
   
42
   
9.23
 
Vessel Classification
   
43
   
9.24
 
No Immunity
   
43
   
9.25
 
Fees and Enforcement
   
43
   
9.26
 
Form of Documentation
   
43
   
9.27
 
Vessel Acquisitions
   
43
               
SECTION 10.
 
AFFIRMATIVE COVENANTS
   
44
   
10.01
 
Information Covenants
   
44
   
10.02
 
Books, Records and Inspections
   
47
   
10.03
 
Maintenance of Property; Insurance; Mortgagee Interest Insurance
   
47
   
10.04
 
Corporate Franchises
   
47
   
10.05
 
Compliance with Statutes, etc
   
48
   
10.06
 
Compliance with Environmental Laws
   
48
   
10.07
 
ERISA
   
49
   
10.08
 
End of Fiscal Years; Fiscal Quarters
   
50
   
10.09
 
Performance of Obligations
   
50
   
10.10
 
Payment of Taxes
   
50
 

 
(iii)
 

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10.11
 
Further Assurances
   
50
   
10.12
 
Deposit of Earnings
   
51
   
10.13
 
Ownership of Subsidiaries
   
51
   
10.14
 
Flag of Mortgaged Vessels; Vessel Classifications
   
51
   
10.15
 
Consent to Assignment of Charters
   
52
   
10.16
 
Age of Additional Vessels
   
52
   
10.17
 
Existing Credit Agreement
   
52
               
SECTION 11.
 
NEGATIVE COVENANTS
   
52
   
11.01
 
Liens
   
52
   
11.02
 
Consolidation, Merger, Sale of Assets, etc
   
53
   
11.03
 
Dividends
   
55
   
11.04
 
Indebtedness
   
56
   
11.05
 
Advances, Investments and Loans
   
56
   
11.06
 
Transactions with Affiliates
   
57
   
11.07
 
Consolidated Interest Coverage Ratio
   
58
   
11.08
 
Maximum Leverage Ratio
   
58
   
11.09
 
Collateral Maintenance
   
58
   
11.10
 
Minimum Cash Balance
   
58
   
11.11
 
Minimum Consolidated Net Worth
   
58
   
11.12
 
Limitation on Modifications of Certificate of Incorporation and By-Laws; etc
   
58
   
11.13
 
Limitation on Certain Restrictions on Subsidiaries
   
59
   
11.14
 
Limitation on Issuance of Capital Stock
   
59
   
11.15
 
Business
   
59
   
11.16
 
Bank Accounts
   
60
               
SECTION 12.
 
EVENTS OF DEFAULT
   
60
   
12.01
 
Payments
   
60
   
12.02
 
Representations, etc
   
60
   
12.03
 
Covenants
   
60
   
12.04
 
Default Under Other Agreements
   
60
   
12.05
 
Bankruptcy, etc
   
61
   
12.06
 
ERISA
   
61
   
12.07
 
Security Documents
   
62
   
12.08
 
Guaranty
   
62
   
12.09
 
Judgments
   
62
   
12.10
 
Change of Control
   
62
               
SECTION 13.
 
DEFINITIONS AND ACCOUNTING TERMS
   
63
   
13.01
 
Defined Terms
   
63
 

 
 
(iv)
 

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SECTION 14.
 
AGENCY AND SECURITY TRUSTEE PROVISIONS
   
87
   
14.01
 
Appointment
   
87
   
14.02
 
Nature of Duties
   
87
   
14.03
 
Lack of Reliance on the Agents
   
88
   
14.04
 
Certain Rights of the Agents
   
88
   
14.05
 
Reliance
   
88
   
14.06
 
Indemnification
   
88
   
14.07
 
The Administrative Agent in its Individual Capacity
   
89
   
14.08
 
Holders
   
89
   
14.09
 
Resignation by the Administrative Agent
   
89
               
SECTION 15.
 
MISCELLANEOUS
   
90
   
15.01
 
Payment of Expenses, etc
   
90
   
15.02
 
Right of Setoff
   
91
   
15.03
 
Notices
   
91
   
15.04
 
Benefit of Agreement
   
91
   
15.05
 
No Waiver; Remedies Cumulative
   
93
   
15.06
 
Payments Pro Rata
   
93
   
15.07
 
Calculations; Computations
   
94
   
15.08
 
GOVERNING LAW; SUBMISSION TO JURISDICTION; VENUE; WAIVER OF JURY TRIAL
   
94
   
15.09
 
Counterparts
   
95
   
15.10
 
Effectiveness
   
95
   
15.11
 
Headings Descriptive
   
96
   
15.12
 
Amendment or Waiver; etc
   
96
   
15.13
 
Survival
   
97
   
15.14
 
Domicile of Loans
   
97
   
15.15
 
Limitation on Additional Amounts, etc
   
97
   
15.16
 
Confidentiality
   
98
   
15.17
 
Register
   
98
   
15.18
 
Judgment Currency
   
99
   
15.19
 
Language
   
99
   
15.20
 
Waiver of Immunity
   
99
   
15.21
 
USA PATRIOT Act Notice
   
100
 

 
 
(v)

 

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 SCHEDULE I               -      The Lenders and the Commitments
 SCHEDULE II              -      The Lenders’ Addresses
 SCHEDULE III                                     -      Subsidiary Guarantors
and Existing Vessels
 SCHEDULE IV                                     -      Subsidiary Guarantors
and Capesize Vessels
 SCHEDULE V                  Indebtedness
 SCHEDULE VI                                     -      Insurance
 SCHEDULE VII                                    -      ERISA
 SCHEDULE VIII                                   -      Subsidiaries
 SCHEDULE IX                                     -      Approved Classification
Societies
 
 
EXHIBIT A
-
Form of Notice of Borrowing

       

 
EXHIBIT B
-
Form of Note

       

 
EXHIBIT C-1
-
Form of Opinion of Kramer Levin Naftalis & Frankel LLP, New York counsel to the
Borrower and its Subsidiaries

       

  EXHIBIT C-2  -  Form of Opinion of Reeder & Simpson, special Marshall Islands
counsel to the Borrower and its Subsidiaries 

 
 
EXHIBIT C-3
-
Form of Opinion of Constantine P. Georgiopoulos, New York maritime counsel to
Borrower and its Subsidiaries

       

 
EXHIBIT C-4
-
Form of Opinion of Johnson Stokes & Master, Hong Kong counsel to the
Administrative Agent

       

  EXHIBIT D -  Form of Officer's Certificate 

 

  EXHIBIT E  -  Form of Guaranty 

       

 
EXHIBIT F
-
Form of Pledge Agreement

       

 
EXHIBIT G
-
Form of Solvency Certificate

       

 
EXHIBIT H-1
-
Form of Assignment of Earnings

       

 
EXHIBIT H-2
-
Form of Assignment of Insurances

       

 
EXHIBIT I
-
Form of Compliance Certificate

       

 
EXHIBIT J
-
Form of Subordination Provisions

       

 
EXHIBIT K
-
Form of Assignment and Assumption Agreement

       

 
EXHIBIT L-1
-
Form of Hong Kong Vessel Mortgage

       

 
EXHIBIT L-2
-
Form of Marshall Islands Vessel Mortgage

       

 
EXHIBIT M
-
Form of Letter of Credit Request

       

  EXHIBIT N    Form of Assignment of Purchase Contracts 

       

  EXHIBIT O    Form of Assignment of Construction Contracts and Refund
Guarantees 

  
 
(vi)
 
 

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THIS SENIOR SECURED REVOLVING CREDIT AGREEMENT (this “Credit Agreement”), is
made as of July 20, 2007, by and among (1) GENCO SHIPPING & TRADING LIMITED, a
corporation organized and existing under the laws of the Republic of Marshall
Islands (the “Borrower”), (2) the banks and financial institutions acceptable to
the Borrower and Mandated Lead Arranger (as defined below) listed in Schedule I
of this Credit Agreement, as lenders (the “Lenders”), and (3) DnB NOR BANK ASA,
acting through its New York branch (“DnB”) as Administrative Agent (in such
capacity, the “Administrative Agent”), mandated lead arranger (in such capacity,
the “Mandated Lead Arranger”), as bookrunner (in such capacity, the
“Bookrunner”), as security trustee and as collateral agent under the Security
Documents (in such capacity, the “Collateral Agent”).  All capitalized terms
used herein and defined in Section 11 are used herein as therein defined.
 
W I T N E S S E T H:
 
WHEREAS, the Borrower desires to finance the purchase price of up to One Billion
One Hundred Eleven Million United States Dollars (US$1,111,000,000) for the
acquisition of nine (9) modern dry-bulk capesize vessels (two such vessels
having been built and completed in 2007 and the remaining seven newbuildings
estimated to be delivered between October  2007 and September  2009)(together,
the “Capesize Vessels”) as listed in Schedule IV, including any initial deposit
(the “Capesize Vessel Deposit”) required pursuant to the relevant Purchase
Contract (as defined in Section 13.01 herein) between the Borrower and the
relevant Seller of any Capesize Vessel;
 
WHEREAS, the Borrower further desires to refinance the outstanding balance under
that certain revolving credit facility agreement dated as of July 15, 2005 (as
amended, the “Existing Credit Agreement”), by and among (1) the Borrower, (2)
the Lenders party thereto from time to time as listed on Schedule I thereto, (3)
DnB, Nordea Bank Finland Plc, New York Branch (“Nordea”) and Citibank Global
Markets Ltd. (“Citibank”), as Joint Lead Arrangers, (4) Nordea and Citibank, as
Joint Book Runners and (5) DnB, as Administrative Agent and Collateral Agent,
pursuant to which the Lenders provided a revolving credit facility in the amount
of up to Five Hundred Fifty Million United States Dollars (US$550,000,000)(the
“Existing Credit Facility”);
 
WHEREAS, the Borrower additionally desires to refinance the outstanding balance
under that certain revolving credit facility evidenced by the promissory note
dated as of May 3, 2007 (the “Revolving Credit Agreement”), by and among (1) the
Borrower, (2) the banks and financial institutions listed on Schedule 1 thereto,
and (3) DnB NOR BANK ASA, acting through its Grand Cayman Branch, as
administrative agent and security trustee for the Lenders, pursuant to which the
Lenders provided a loan to the Borrower in the principal amount of One Hundred
Fifty Five Million United States Dollars ($155,000,000) (the “Revolving Credit
Facility”);
 
WHEREAS, the Borrower additionally desires to finance up to Fifty Million United
States Dollars (US$50,000,000) in working capital, provide for the issuance of
up to Fifty Million United States Dollars (US$50,000,000) in the form of standby
letters of credit, as well as the acquisition of Additional Vessels and any
initial deposit or Pre-Delivery Installment required for acquisition of such
Additional Vessels; and
 
 

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WHEREAS, subject to and upon the terms and conditions herein set forth, the
Lenders are willing to make available to the Borrower a credit facility (the
“Facility”) in an amount (the “Total Facility Amount”) not to exceed One Billion
Three Hundred Seventy Seven Million United States Dollars (US$1,377,000,000);
 
NOW, THEREFORE, IT IS AGREED:
 
SECTION 1.  Amount and Terms of Credit Facilities.
 
1.01  The Commitments.  Subject to and upon the terms and conditions set forth
herein, each Lender with a Commitment severally agrees to make at any time on or
after the Effective Date and prior to the Maturity Date a revolving loan or
revolving loans (each, a “Loan” and, collectively, the “Loans”) to the Borrower,
which Loans (i) shall bear interest in accordance with Section 1.07, (ii) shall
be denominated in Dollars, (iii) may be repaid and reborrowed in accordance with
the provisions hereof, (iv) shall not exceed for any Lender at any time that
aggregate principal amount outstanding which, when added to the amount of such
Lender’s Percentage of all Letter of Credit Outstandings (exclusive of Unpaid
Drawings which are repaid with the proceeds of, and simultaneously with the
incurrence of, the respective incurrence of Loans) at such time, equals the
Commitment of such Lender at such time and (v) shall not exceed for all Lenders
at any time that aggregate principal amount outstanding which, when added to the
amount of all Letter of Credit Outstandings (exclusive of Unpaid Drawings which
are repaid with the proceeds of, and simultaneously with the incurrence of, the
respective incurrence of Loans) at such time, equals the Total Commitment at
such time; provided that on the Effective Date the Lenders’ Commitment shall not
exceed One Hundred Eighty Five Million United States Dollars (US$185,000,000)
and further provided that the Lenders’ Commitment shall not exceed sixty percent
(60%) of the Total Facility Amount until the earlier of (i) the completion of
secondary syndication of the Facility Amount or (ii) September 30, 2007.
 
1.02  Minimum Amount of Each Borrowing; Limitation on Number of
Borrowings.  (a)  The aggregate principal amount of each Borrowing of Loans
shall not be less than the Minimum Borrowing Amount.
 
(b)  More than one Borrowing may occur on the same date, but at no time shall
there be outstanding more than fifteen Borrowings of Loans subject to different
Interest Periods in the aggregate at any time.
 
1.03  Notice of Borrowing.  (a)  Whenever the Borrower desires to make a
Borrowing hereunder, it shall give the Administrative Agent at its Notice Office
at least three Business Days’ prior written notice of each Loan to be made
hereunder, provided that any such notice shall be deemed to have been given on a
certain day only if given before 4:00 P.M. (New York time).  Each such written
notice (each a “Notice of Borrowing”), except as otherwise expressly provided in
Section 1.09, shall be irrevocable and shall be given by the Borrower in the
form of Exhibit A, appropriately completed to specify (i) the aggregate
principal amount of the Loans to be made pursuant to such Borrowing, (ii) the
date of such Borrowing (which shall be a Business Day), (iii) the initial
Interest Period to be applicable thereto, (iv) the use of the proceeds of the
Loans made pursuant to such Borrowing, and (v) to which account the proceeds of
such Loans are to be deposited.  The Administrative Agent shall promptly give
each Lender notice of
 
 
 
 
2

--------------------------------------------------------------------------------

 
 
such proposed Borrowing, of such Lender’s proportionate share thereof and of the
other matters required by the immediately preceding sentence to be specified in
the Notice of Borrowing.
 
(b)  Without in any way limiting the obligation of the Borrower to deliver a
written Notice of Borrowing in accordance with Section 1.03(a), the
Administrative Agent may act without liability upon the basis of telephonic
notice of such Borrowing, believed by the Administrative Agent in good faith to
be from an Authorized Officer of the Borrower prior to receipt of Notice of
Borrowing.  In each such case, the Borrower hereby waives the right to dispute
the Administrative Agent’s record of the terms of such telephonic notice of such
Borrowing of Loans, absent manifest error.
 
1.04  Disbursement of Funds.  Except as otherwise specifically provided in the
immediately succeeding sentence, no later than 12:00 Noon (New York time) on the
date specified in each Notice of Borrowing, each Lender will make available its
pro rata portion of each such Borrowing requested to be made on such date.  All
such amounts shall be made available in Dollars and in immediately available
funds at the Payment Office of the Administrative Agent and the Administrative
Agent will make available to the Borrower (prior to 1:00 P.M. (New York Time) on
such day to the extent of funds actually received by the Administrative Agent
prior to 12:00 Noon (New York Time) on such day) at the Payment Office, in the
account specified in the applicable Notice of Borrowing, the aggregate of the
amounts so made available by the Lenders.  Unless the Administrative Agent shall
have been notified by any Lender prior to the date of Borrowing that such Lender
does not intend to make available to the Administrative Agent such Lender’s
portion of any Borrowing to be made on such date, the Administrative Agent may
assume that such Lender has made such amount available to the Administrative
Agent on such date of Borrowing and the Administrative Agent may, in reliance
upon such assumption, make available to the Borrower a corresponding amount.  If
such corresponding amount is not in fact made available to the Administrative
Agent by such Lender, the Administrative Agent shall be entitled to recover such
corresponding amount on demand from such Lender.  If such Lender does not pay
such corresponding amount forthwith upon the Administrative Agent’s demand
therefore, the Administrative Agent shall promptly notify the Borrower and the
Borrower shall immediately pay such corresponding amount to the Administrative
Agent.  The Administrative Agent shall also be entitled to recover on demand
from such Lender or the Borrower, as the case may be, interest on such
corresponding amount in respect of each day from the date such corresponding
amount was made available by the Administrative Agent to the Borrower until the
date such corresponding amount is recovered by the Administrative Agent, at a
rate per annum equal to (i) if recovered from such Lender, at the overnight
Federal Funds Rate and (ii) if recovered from the Borrower, the rate of interest
applicable to the respective Borrowing, as determined pursuant to Section
1.07.  
 
1.05  Notes.  (a)  The Borrower’s obligation to pay the principal of, and
interest on, the Loans made by each Lender shall, if requested by such Lender,
be evidenced by a promissory note duly executed and delivered by the Borrower
substantially in the form of Exhibit B with blanks appropriately completed in
conformity herewith (each a “Note” and, collectively, the “Notes”).
 
(b)  Each Note shall (i) be executed by the Borrower, (ii) be payable to the
order of such Lender and be dated the Effective Date (or, in the case of Notes
issued after the Effective Date, be dated the date of issuance thereof),
(iii) be in a stated principal amount equal to the Commitment of such Lender on
the Effective Date (or, in the case of Notes issued after the
 
 
 
3

--------------------------------------------------------------------------------

 
 
 
Effective Date, be in a stated principal amount equal to the Commitment of such
Lender on the date of the issuance thereof) and be payable in the principal
amount of the Loans evidenced thereby, (iv) mature on the Maturity Date,
(v) bear interest as provided in Section 1.07, (vi) be subject to voluntary
prepayment and mandatory repayment as provided in Sections 4.01 and 4.02 and
(vii) be entitled to the benefits of this Agreement and the other Credit
Documents.
 
(c)  Each Lender will note on its internal records the amount of each Loan made
by it and each payment in respect thereof and will, prior to any transfer of any
of its Notes, endorse on the reverse side thereof the outstanding principal
amount of Loans evidenced thereby which notation shall be prima facie evidence
of the amount of the Loans.  However, failure to make any such notation or any
error in any such notation or endorsement shall not affect the Borrower’s
obligations in respect of such Loans.
 
(d)  Notwithstanding anything to the contrary contained above in this Section
1.05 or elsewhere in this Agreement, Notes shall be delivered only to Lenders
that at any time specifically request the delivery of such Notes.  No failure of
any Lender to request or obtain a Note evidencing its Loans to the Borrower
shall affect or in any manner impair the obligations of the Borrower to pay the
Loans (and all related Obligations) incurred by the Borrower that would
otherwise be evidenced thereby in accordance with the requirements of this
Agreement, and shall not in any way affect the security or guaranties therefore
provided pursuant to the Credit Documents.  Any Lender that does not have a Note
evidencing its outstanding Loans shall in no event be required to make the
notations otherwise described in preceding clause (c).  At any time (including,
without limitation, to replace any Note that has been destroyed or lost) when
any Lender requests the delivery of a Note to evidence any of its Loans, the
Borrower shall promptly execute and deliver to such Lender the requested Note in
the appropriate amount or amounts to evidence such Loans provided that, in the
case of a substitute or replacement Note, the Borrower shall have received from
such requesting Lender (i) an affidavit of loss or destruction and (ii) a
customary lost/destroyed Note indemnity, in each case in form and substance
reasonably acceptable to the Borrower and such requesting Lender, and duly
executed by such requesting Lender.
 
1.06  Pro Rata Borrowings.  All Borrowings of Loans under this Agreement shall
be incurred from the Lenders pro rata on the basis of their Commitments.  It is
understood that no Lender shall be responsible for any default by any other
Lender of its obligation to make Loans hereunder and that each Lender shall be
obligated to make the Loans provided to be made by it hereunder, regardless of
the failure of any other Lender to make its Loans hereunder.
 
1.07  Interest.  (a)  The Borrower agrees to pay interest in respect of the
unpaid principal amount of each Loan from the date the proceeds thereof are made
available to the Borrower until such Loan is paid in full at a rate per annum
which shall, during each Interest Period applicable thereto, be equal to the sum
of the Applicable Margin plus the LIBOR for such Interest Period.
 
(b)  Overdue principal and, to the extent permitted by law, overdue interest in
respect of each Loan and any other overdue amount payable hereunder shall, in
each case, bear
 
 
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interest at a rate per annum equal to 2% per annum in excess of the rate then
borne by such Loans (or, if such overdue amount is not interest or principal in
respect of a Loan, 2.50% per annum in excess of the Base Rate as in effect from
time to time), in each case with such interest to be payable on demand.
 
(c)  Accrued and unpaid interest shall be payable in respect of each Loan, on
the last day of each Interest Period applicable thereto and, in the case of an
Interest Period in excess of three months, on each date occurring at three month
intervals after the first day of such Interest Period, on any repayment or
prepayment (on the amount repaid or prepaid), at maturity (whether by
acceleration or otherwise) and, after such maturity, on demand.
 
(d)  Upon each Interest Determination Date, the Administrative Agent shall
determine LIBOR for each Interest Period applicable to the Loans to be made
pursuant to the applicable Borrowing and shall promptly notify the Borrower and
the Lenders thereof.  Each such determination shall, absent manifest error, be
final and conclusive and binding on all parties hereto.
 
1.08  Interest Periods.  At the time the Borrower gives any Notice of Borrowing
in respect of the making of any Loan (in the case of the initial Interest Period
applicable thereto) or on the third Business Day prior to the expiration of an
Interest Period applicable to such Loan (in the case of any subsequent Interest
Period) (provided that any such notice shall be deemed to be given on a certain
day only if given before 11:00 A.M. (New York time)), it shall have the right to
elect, by giving the Administrative Agent notice thereof, the interest period
(each an “Interest Period”) applicable to such Loan, which Interest Period
shall, at the option of the Borrower, be a one, three, six or, to the extent
available and agreed by all Lenders, nine or twelve month period and such other
period of less than 30 days; provided that any Interest Period selected pursuant
to this clause shall be approved by the Administrative Agent in its reasonable
discretion and that:
 
(i)  all Loans comprising a Borrowing shall at all times have the same Interest
Period;
 
(ii)  the initial Interest Period for any Loan shall commence on the date of
Borrowing of such Loan and each Interest Period occurring thereafter in respect
of such Loan shall commence on the day on which the immediately preceding
Interest Period applicable thereto expires;
 
(iii)  if any Interest Period relating to a Loan begins on a day for which there
is no numerically corresponding day in the calendar month at the end of such
Interest Period, such Interest Period shall end on the last Business Day of such
calendar month;
 
(iv)  if any Interest Period would otherwise expire on a day which is not a
Business Day, such Interest Period shall expire on the first succeeding Business
Day; provided, however, that if any Interest Period for a Loan would otherwise
expire on a day which is not a Business Day but is a day of the month after
which no further Business Day occurs in such month, such Interest Period shall
expire on the immediately preceding Business Day;
 
 
 
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(v)  no Interest Period longer than one month may be selected at any time when
an Event of Default (or, if the Administrative Agent or the Required Lenders
have determined that such an election at such time would be disadvantageous to
the Lenders, a Default) has occurred and is continuing;
 
(vi)  no Interest Period in respect of any Borrowing of any Loans shall be
selected which extends beyond the Maturity Date;
 
(vii)  no Interest Period in respect of any Borrowing of Loans shall be selected
which extends beyond any date upon which a mandatory repayment of Loans will be
required to be made under Section 4.02(a) as a result of a reduction to the
Total Commitment pursuant to Section 3.03(b) if the aggregate principal amount
of Loans which have Interest Periods which will expire after such date will be
in excess of the aggregate principal amount of Loans then outstanding less the
aggregate amount of such required repayment on such date; and
 
(viii)  the selection of Interest Periods shall be subject to the provisions of
Section 1.02(b).
 
If by 11:00 A.M. (New York time) on the third Business Day prior to the
expiration of any Interest Period applicable to a Borrowing, the Borrower has
failed to elect a new Interest Period to be applicable to such Loans as provided
above, the Borrower shall be deemed to have elected a one month Interest Period
to be applicable to such Loans effective as of the expiration date of such
current Interest Period.
 
1.09  Increased Costs, Illegality, etc.  (a)  In the event that any Lender shall
have determined in good faith (which determination shall, absent manifest error,
be final and conclusive and binding upon all parties hereto but, with respect to
clause (i) below, may be made only by the Administrative Agent):
 
(i)  on any Interest Determination Date that, by reason of any changes arising
after the date of this Agreement affecting the London interbank market, adequate
and fair means do not exist for ascertaining the applicable interest rate on the
basis provided for in the definition of LIBOR; or
 
(ii)  at any time, that such Lender shall incur increased costs or reductions in
the amounts received or receivable hereunder with respect to any Loan because of
(x) any change since the Effective Date in any applicable law or governmental
rule, regulation, order, guideline or request (whether or not having the force
of law) or in the interpretation or administration thereof and including the
introduction of any new law or governmental rule, regulation, order, guideline
or request, such as, for example, but not limited to:  (A) a change in the basis
of taxation of payment to any Lender of the principal of or interest on such
Loan or any other amounts payable hereunder (except for changes in the rate of
tax on, or determined by reference to, the net income, gross receipts or net
profits of such Lender, or any franchise tax based on net income, net profits or
net worth of such Lender, in each case pursuant to the laws of the jurisdiction
in which such Lender is organized or in which such Lender’s principal office or
applicable lending office is located or any subdivision thereof or
 
 
 
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therein), but without duplication of any amounts payable in respect of Taxes
pursuant to Section 4.04, or (B) a change in official reserve requirements but,
in all events, excluding reserves required under Regulation D to the extent
included in the computation of the LIBOR and/or (y) other circumstances arising
since the Effective Date affecting such Lender or the London interbank market
for Dollars or the position of such Lender in such market; or
 
(iii)  at any time, that the making or continuance of any Loan has been made
(x) unlawful by any law or governmental rule, regulation or order,
(y) impossible by compliance by any Lender in good faith with any governmental
request (whether or not having force of law) and/or (z) impracticable as a
result of a contingency occurring after the Effective Date which materially and
adversely affects the London interbank  market for Dollars;
 
then, and in any such event, such Lender (or the Administrative Agent, in the
case of clause (i) above) shall promptly give notice (by telephone confirmed in
writing) to the Borrower and, except in the case of clause (i) above, to the
Administrative Agent of such determination (which notice the Administrative
Agent shall promptly transmit to each of the Lenders).  Thereafter (x) in the
case of clause (i) above, any Notice of Borrowing given by the Borrower with
respect to any affected Loans which have not yet been incurred shall be deemed
rescinded by the Borrower and the Total Commitment shall thereafter not be
available to be borrowed hereunder, and the rate of interest applicable to any
affected Loans then outstanding shall be the Base Rate, as in effect from time
to time, from the date such notice is delivered to the Borrower and thereafter
until such time as the Administrative Agent notifies the Borrower and the
Lenders that the circumstances giving rise to such notice by the Administrative
Agent no longer exist, (y) in the case of clause (ii) above, the Borrower
agrees, subject to the provisions of Section 1.11 and Section 15.15 (to the
extent applicable), to pay to such Lender, upon written demand therefore such
additional amounts (in the form of an increased rate of, or a different method
of calculating, interest or otherwise as such Lender in its reasonable good
faith discretion shall determine) as shall be required to compensate such Lender
for such increased costs or reductions in amounts received or receivable
hereunder (a written notice as to the additional amounts owed to such Lender,
showing in reasonable detail the basis for and the calculation thereof,
submitted to the Borrower by such Lender in good faith shall, absent manifest
error, be final and conclusive and binding on all the parties hereto) and (z) in
the case of clause (iii) above, and subject to Section 1.11, such Lender shall
so notify the Administrative Agent and the Borrower (and the Administrative
Agent shall promptly give notice thereof to the other Lenders) and thereafter
(A) except in the case of an event of the type described in clause
(iii)(z) above, the Commitment of such Lender shall be permanently reduced by an
amount sufficient to alleviate such circumstance arising pursuant to clause
(iii)(x) or (y) above, or shall be terminated in its entirety if all of such
Lender’s Loans are so affected, and the Borrower shall prepay in full the
affected Loans of such Lender, together with accrued interest thereon and, in
the event of a termination of such Lender’s Commitment, any Commitment
Commission which may be due to such Lender under this Agreement (and, in the
event all of such Lender’s Loans are being repaid, any other amounts which may
be owing to such Lender hereunder (including, without limitation, any accrued
and unpaid interest)), on either the last day of the then current Interest
Period applicable to each such affected Loan (if such Lender may lawfully
continue to maintain and fund such Loans) or immediately (if such Lender may not
lawfully continue to maintain and fund such Loans to such day) and (B) in the
case of an event of the type described in clause (iii)(z) above,
 
 
 
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the Commitment of such Lender shall be terminated in its entirety and the
Borrower shall pay to such Lender any accrued and unpaid Commitment Commission
which may be due to such Lender under this Agreement, and all outstanding Loans
of such Lender shall, from the date such notice is delivered to the Borrower and
thereafter until such time as the Administrative Agent or such Lender shall
notify the Borrower that the circumstances giving rise to the operation of
clause (iii)(z) above with respect to such Lender no longer exist.  The
Administrative Agent and each Lender (to the extent it continues to be a Lender
hereunder) agree that if any of them gives notice to the Borrower of any of the
events described in clause (i) or (iii) above, it shall promptly notify the
Borrower and, in the case of any such Lender, the Administrative Agent, if such
event ceases to exist.  If any such event described in clause (iii) above ceases
to exist as to a Lender (to the extent it continues at such time to be a Lender
hereunder), the obligations of such Lender to make Loans on the terms and
conditions contained herein shall to the extent of such Lender’s outstanding
Loans and Commitments as in effect at such time, be immediately reinstated.
 
(b)  If any Lender in good faith determines that after the Effective Date the
introduction of or effectiveness of or any change in any applicable law or
governmental rule, regulation, order, guideline, directive or request (whether
or not having the force of law) concerning capital adequacy, or any change in
interpretation or administration thereof by the NAIC or any governmental
authority, central bank or comparable agency will have the effect of increasing
the amount of capital required or requested to be maintained by such Lender, or
any corporation controlling such Lender, based on the existence of such Lender’s
Commitments hereunder or its obligations hereunder, then the Borrower agrees,
subject to the provisions of Section 15.15 (to the extent applicable), to pay to
such Lender, upon its written demand therefore, such additional amounts as shall
be required to compensate such Lender or such other corporation for the
increased cost to such Lender or such other corporation or the reduction in the
rate of return to such Lender or such other corporation as a result of such
increase of capital.  In determining such additional amounts, each Lender will
act reasonably and in good faith and will use averaging and attribution methods
which are reasonable, providedthat such Lender’s determination of compensation
owing under this Section 1.09(b) shall, absent manifest error, but subject to
the provisions of Section 15.15 (to the extent applicable), be final and
conclusive and binding on all the parties hereto.  Each Lender, upon determining
that any additional amounts will be payable pursuant to this Section 1.09(b),
will give prompt written notice thereof to the Borrower, which notice shall show
in reasonable detail the basis for and calculation of such additional amounts.
 
1.10  Compensation.  The Borrower agrees, subject to the provisions of Section
15.15 (to the extent applicable), to compensate each Lender, upon its written
request (which request shall set forth in reasonable detail the basis for
requesting and the calculation of such compensation), for all reasonable losses,
expenses and liabilities (including, without limitation, any such loss, expense
or liability incurred by reason of the liquidation or reemployment of deposits
or other funds required by such Lender to fund its Loans but excluding any loss
of anticipated profits) which such Lender may sustain in respect of Loans made
to the Borrower:  (i) if for any reason (other than a default by such Lender or
the Administrative Agent) a Borrowing of Loans does not occur on a date
specified therefore in a Notice of Borrowing (whether or not withdrawn by the
Borrower or deemed withdrawn pursuant to Section 1.09(a)); (ii) if any
prepayment or repayment (including any prepayment or repayment made pursuant to
Section 1.09(a), Section 4.01 or Section 4.02 or as a result of an acceleration
of the Loans
 
 
 
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pursuant to Section 12) of any of its Loans, or assignment of its Loans pursuant
to Section 1.12, occurs on a date which is not the last day of an Interest
Period with respect thereto; (iii) if any prepayment of any of its Loans is not
made on any date specified in a notice of prepayment given by the Borrower; or
(iv) as a consequence of any other Default or Event of Default arising as a
result of the Borrower’s failure to repay Loans or make payment on any Note held
by such Lender when required by the terms of this Agreement.
 
1.11  Change of Lending Office.  Each Lender agrees that on the occurrence of
any event giving rise to the operation of Section 1.09(a)(ii) or (iii),
Section 1.09(b), Section 2.05 or Section 4.04 with respect to such Lender, it
will, if requested by the Borrower, use reasonable good faith efforts (subject
to overall policy considerations of such Lender) to designate another lending
office for any Loans or Letters of Credit affected by such event, provided that
such designation is made on such terms that such Lender and its lending office
suffer no economic, legal or regulatory disadvantage, with the object of
avoiding the consequence of the event giving rise to the operation of such
Section.  Nothing in this Section 1.11 shall affect or postpone any of the
obligations of the Borrower or the rights of any Lender provided in Section 1.09
and Section 4.04.
 
1.12  Replacement of Lenders.  (x)  If any Lender defaults in its obligations to
make Loans, (y) upon the occurrence of any event giving rise to the operation of
Section 1.09(a)(ii) or (iii), Section 1.09(b), Section 2.05 or Section 4.04 with
respect to any Lender which results in such Lender charging to the Borrower
increased costs in excess of those being generally charged by the other Lenders,
or (z) as provided in Section 15.12(b) in the case of certain refusals by a
Lender to consent to certain proposed changes, waivers, discharges or
terminations with respect to this Agreement which have been approved by the
Required Lenders, the Borrower shall have the right, if no Default or Event of
Default will exist immediately after giving effect to the respective
replacement, to replace such Lender (the “Replaced Lender”) with one or more
other Eligible Transferee or Eligible Transferees (collectively, the
“Replacement Lender”) reasonably acceptable to the Administrative Agent,
provided that:
 
(i)  at the time of any replacement pursuant to this Section 1.12, the
Replacement Lender shall enter into one or more Assignment and Assumption
Agreements pursuant to Section 15.04(b) (and with all fees payable pursuant to
said Section 15.04(b) to be paid by the Replacement Lender) pursuant to which
the Replacement Lender shall acquire all of the Commitments and outstanding
Loans of the Replaced Lender and, in connection therewith, shall pay to the
Replaced Lender in respect thereof an amount equal to the sum (without
duplication) of (x) an amount equal to the principal of, and all accrued
interest on, all outstanding Loans of the Replaced Lender, and (y) an amount
equal to all accrued, but unpaid, Commitment Commission and other fees owing to
the Replaced Lender pursuant to Section 3.01; and
 
(ii)  all obligations of the Borrower due and owing to the Replaced Lender at
such time (other than those specifically described in clause (i) above in
respect of which the assignment purchase price has been, or is concurrently
being, paid) shall be paid in full to such Replaced Lender concurrently with
such replacement.
 
 
 
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Upon the execution of the respective Assignment and Assumption Agreement, the
payment of amounts referred to in clauses (i) and (ii) above and, if so
requested by the Replacement Lender, delivery to (i) the Replacement Lender of
the appropriate Note or Notes executed by the Borrower, the Replacement Lender
shall become a Lender hereunder and the Replaced Lender shall cease to
constitute a Lender hereunder, except with respect to indemnification provisions
under this Agreement (including, without limitation, Sections 1.09, 1.10, 2.05,
4.04, 15.01 and 15.06), which shall survive as to such Replaced Lender.
 
SECTION 2.  Letters of Credit.  
 
2.01  Letters of Credit.  (a)  Subject to and upon the terms and conditions
herein set forth, the Borrower may request that any Issuing Lender issue, at any
time and from time to time on and after the conditions set forth in Sections 5,
6, 7 and 8 have been met and prior to the 60th day prior to the Maturity Date,
for the account of the Borrower, irrevocable sight standby letters of credit, in
a form customarily used by such Issuing Lender or in such other form as has been
approved by such Issuing Lender (each such letter of credit, a “Letter of
Credit”).  All Letters of Credit shall be denominated in Dollars and shall be
issued on a sight draft basis.
 
(b)  Subject to the terms and conditions contained herein, each Issuing Lender
hereby agrees that it will, at any time and from time to time on or after the
Effective Date and prior to the 60th day prior to the Maturity Date, following
its receipt of the respective Letter of Credit Request, issue for the account of
the Borrower one or more Letters of Credit in support of such obligations of the
Borrower and its Subsidiaries as are permitted to remain outstanding without
giving rise to a Default or an Event of Default hereunder, provided that the
respective Issuing Lender shall be under no obligation to issue any Letter of
Credit of the types described above if at the time of such issuance:
 
(i)  any order, judgment or decree of any governmental authority or arbitrator
shall purport by its terms to enjoin or restrain such Issuing Lender from
issuing such Letter of Credit or any requirement of law applicable to such
Issuing Lender or any request or directive (whether or not having the force of
law) from any governmental authority with jurisdiction over such Issuing Lender
shall prohibit, or request that such Issuing Lender refrain from, the issuance
of letters of credit generally or such Letter of Credit in particular or shall
impose upon such Issuing Lender with respect to such Letter of Credit any
restriction or reserve or capital requirement (for which such Issuing Lender is
not otherwise compensated) not in effect on the date hereof, or any unreimbursed
loss, cost or expense which was not applicable, in effect or known to such
Issuing Lender as of the date hereof and which such Issuing Lender in good faith
deems material to it; or
 
(ii)  such Issuing Lender shall have received notice from any Lender prior to
the issuance of such Letter of Credit of the type described in the second
sentence of Section 2.02(b); or
 
(iii)  a Lender Default exists, unless such Issuing Lender has entered into
arrangements satisfactory to it and the Borrower to eliminate such Issuing
Lender’s risk with respect to the participation in Letters of Credit of any
Defaulting Lender(s), including by
 
 
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cash collateralizing any such Defaulting Lender’s (or Defaulting Lenders’)
Percentage (or Percentages) of the Letter of Credit Outstandings.
 
(c)  Notwithstanding anything to the contrary contained in this Agreement,
(i) no Letter of Credit shall be issued the Stated Amount of which, when added
to the Letter of Credit Outstandings (exclusive of Unpaid Drawings which are
repaid on the date of, and prior to the issuance of, the respective Letter of
Credit) at such time would exceed either (x) $50,000,000 or (y) when added to
the aggregate principal amount of all Loans then outstanding, an amount equal to
the Total Commitment at such time, and (ii) each Letter of Credit shall by its
terms terminate on or before the earlier of (A) the date which occurs 12 months
after the date of the issuance thereof (although any such Letter of Credit shall
be extendible for successive periods of up to 12 months, but, in each case, not
beyond the tenth Business Day prior to the Maturity Date, on terms acceptable to
the respective Issuing Lender) and (B) ten Business Days prior to the Maturity
Date.
 
(d)  Notwithstanding anything to the contrary contained in this Agreement,
Letters of Credit may only be issued to support obligations of the Borrower and
its Subsidiaries under freight derivative contracts satisfactory to the
Administrative Agent.
 
2.02  Letter of Credit Requests; Minimum Stated Amount.  (a)  Whenever the
Borrower desires that a Letter of Credit be issued, the Borrower shall give the
Administrative Agent and the respective Issuing Lender at least five Business
Days’ (or such shorter period as is acceptable to the respective Issuing Lender)
written notice prior to the proposed date of issuance (which shall be a Business
Day).  Each notice shall be substantially in the form of Exhibit M (each a
“Letter of Credit Request”).
 
(b)  The making of each Letter of Credit Request shall be deemed to be a
representation and warranty by the Borrower that such Letter of Credit may be
issued in accordance with, and will not violate the requirements of, Section
2.01(c).  Unless the respective Issuing Lender determines that, or has received
notice from any Lender before it issues a Letter of Credit that, one or more of
the conditions specified in Section 8.01 are not then satisfied, or that the
issuance of such Letter of Credit would violate Section 2.01(c) or (d), then
such Issuing Lender shall issue the requested Letter of Credit for the account
of the Borrower in accordance with such Issuing Lender’s usual and customary
practices.
 
(c)  The initial Stated Amount of each Letter of Credit shall not be less than
$20,000 or such lesser amount as is acceptable to the respective Issuing Lender.
 
2.03  Letter of Credit Participations.  (a)  Immediately upon the issuance by
any Issuing Lender of any Letter of Credit, such Issuing Lender shall be deemed
to have sold and transferred to each Lender (each such Lender, in its capacity
under this Section 2.03, a “Participant”), and each such Participant shall be
deemed irrevocably and unconditionally to have purchased and received from such
Issuing Lender, without recourse or warranty, an undivided interest and
participation, to the extent of such Participant’s Percentage, in such Letter of
Credit, each drawing made thereunder and the obligations of the Borrower under
this Agreement with respect thereto, and any security therefore or guaranty
pertaining thereto.  Upon any change in the Commitments or Percentages of the
Lenders pursuant to Sections 1.12, 3.02(b)
 
 
 
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or 15.04, it is hereby agreed that, with respect to all outstanding Letters of
Credit and Unpaid Drawings, there shall be an automatic adjustment to the
participations pursuant to this Section 2.03 to reflect the new Percentages of
the assignor and assignee Lender or of all Lenders, as the case may be.
 
(b)  In determining whether to pay under any Letter of Credit, such Issuing
Lender shall have no obligation relative to the other Lenders other than to
confirm that any documents required to be delivered under such Letter of Credit
appear to have been delivered and that they appear to substantially comply on
their face with the requirements of such Letter of Credit.  Subject to the
provisions of the immediately preceding sentence, any action taken or omitted to
be taken by any Issuing Lender under or in connection with any Letter of Credit
if taken or omitted in the absence of gross negligence or willful misconduct, as
determined by a court of competent jurisdiction, shall not create for such
Issuing Lender any resulting liability to any Credit Party or any Lender.
 
(c)  In the event that any Issuing Lender makes any payment under any Letter of
Credit issued by it and the Borrower shall not have reimbursed such amount in
full to such Issuing Lender pursuant to Section 2.04(a), such Issuing Lender
shall promptly notify the Administrative Agent, which shall promptly notify each
Participant, of such failure, and each Participant shall promptly and
unconditionally pay to the Administrative Agent for the account of such Issuing
Lender the amount of such Participant’s Percentage (as relates to the respective
Letter of Credit) of such unreimbursed payment in Dollars and in same day
funds.  If the Administrative Agent so notifies, prior to 11:00 A.M. (New York
time) on any Business Day, any Participant required to fund a payment under a
Letter of Credit, such Participant shall make available to the Administrative
Agent at the Payment Office for the account of such Issuing Lender in Dollars
such Participant’s Percentage (as relates to the respective Letter of Credit) of
the amount of such payment on such Business Day in same day funds.  If and to
the extent such Participant shall not have so made its Percentage of the amount
of such payment available to the Administrative Agent for the account of such
Issuing Lender, such Participant agrees to pay to the Administrative Agent for
the account of such Issuing Lender, forthwith on demand such amount, together
with interest thereon, for each day from such date until the date such amount is
paid to the Administrative Agent for the account of such Issuing Lender at the
overnight Federal Funds Rate.  The failure of any Participant to make available
to the Administrative Agent for the account of such Issuing Lender its
Percentage of any payment under any Letter of Credit issued by it shall not
relieve any other Participant of its obligation hereunder to make available to
the Administrative Agent for the account of such Issuing Lender its Percentage
of any such Letter of Credit on the date required, as specified above, but no
Participant shall be responsible for the failure of any other Participant to
make available to the Administrative Agent for the account of such Issuing
Lender such other Participant’s Percentage of any such payment.
 
(d)  Whenever any Issuing Lender receives a payment of a reimbursement
obligation as to which the Administrative Agent has received (for the account of
any such Issuing Lender) any payments from the Participants pursuant to clause
(c) above, such Issuing Lender shall forward such payment to the Administrative
Agent, which in turn shall distribute to each Participant which has paid its
Percentage thereof, in same day funds, an amount equal to such Participant’s
share (based upon the proportionate aggregate amount originally funded by such
Participant to the aggregate amount funded by all Participants) of the principal
amount of
 
 
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such reimbursement obligation and interest thereon accruing after the purchase
of the respective participations.
 
(e)  Each Issuing Lender shall, promptly after the issuance of, or amendment to,
a Letter of Credit give the Administrative Agent and the Borrower written notice
of such issuance or amendment, as the case may be, and such notice shall be
accompanied by a copy of the issued Letter of Credit or amendment, as the case
may be.  Upon receipt of such notice, the Administrative Agent shall promptly
notify each Participant, in writing, of such issuance or amendment and in the
event a Participant shall so request, the Administrative Agent shall furnish
such Participant with a copy of such Letter of Credit or amendment.
 
(f)  Each Issuing Lender shall deliver to the Administrative Agent, promptly on
the first Business Day of each week, by facsimile transmission, the aggregate
daily Stated Amount available to be drawn under the outstanding Letters of
Credit issued by such Issuing Lender for the previous week.  The Administrative
Agent shall, within 10 days after the last Business Day of each calendar month,
deliver to each Participant a report setting forth for such preceding calendar
month the aggregate daily Stated Amount available to be drawn under all
outstanding Letters of Credit during such calendar month.
 
(g)  The obligations of the Participants to make payments to the Administrative
Agent for the account of the respective Issuing Lender with respect to Letters
of Credit issued by it shall be irrevocable and not subject to any qualification
or exception whatsoever and shall be made in accordance with the terms and
conditions of this Agreement under all circumstances, including, without
limitation, any of the following circumstances:
 
(i)  any lack of validity or enforceability of this Agreement or any of the
other Credit Documents;
 
(ii)  the existence of any claim, setoff, defense or other right which the
Borrower or any of its Subsidiaries may have at any time against a beneficiary
named in a Letter of Credit, any transferee of any Letter of Credit (or any
Person for whom any such transferee may be acting), the Administrative Agent,
any Lender, any Issuing Lender, any Participant, or any other Person, whether in
connection with this Agreement, any Letter of Credit, the transactions
contemplated herein or any unrelated transactions (including any underlying
transaction between the Borrower or any of its Subsidiaries and the beneficiary
named in any such Letter of Credit);
 
(iii)  any draft, certificate or any other document presented under any Letter
of Credit proving to be forged, fraudulent, invalid or insufficient in any
respect or any statement therein being untrue or inaccurate in any respect;
 
(iv)  the surrender or impairment of any security for the performance or
observance of any of the terms of any of the Credit Documents; or
 
(v)  the occurrence of any Default or Event of Default.
 
2.04  Agreement to Repay Letter of Credit Drawings.  (a)  The Borrower hereby
agrees to reimburse each Issuing Lender, by making payment to the Administrative
Agent in
 
 
 
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immediately available funds at the Payment Office, for any payment or
disbursement made by such Issuing Lender under any Letter of Credit issued by it
(each such amount, so paid until reimbursed by the Borrower, an “Unpaid
Drawing”), not later than four Business Days following receipt by the Borrower
of notice of such payment or disbursement (provided that no such notice shall be
required to be given if a Default or an Event of Default under Section 12.05
shall have occurred and be continuing, in which case the Unpaid Drawing shall be
due and payable immediately without presentment, demand, protest or notice of
any kind (all of which are hereby waived by the Borrower)), with interest on the
amount so paid or disbursed by such Issuing Lender, to the extent not reimbursed
prior to 12:00 Noon (New York time) on the date of such payment or disbursement,
from and including the date paid or disbursed to but excluding the date such
Issuing Lender was reimbursed by the Borrower therefore at a rate per annum
equal to the [Base Rate], as in effect from time to time; provided, however, to
the extent such amounts are not reimbursed prior to 12:00 Noon (New York time)
on the fourth Business Day following the receipt by the Borrower of notice of
such payment or disbursement or following the occurrence of a Default or an
Event of Default under Section 12.05, interest shall thereafter accrue on the
amounts so paid or disbursed by such Issuing Lender (and until reimbursed by the
Borrower) at a rate per annum equal to the Base Rate in effect from time to time
plus the Applicable Margin as in effect from time to time plus 1%, with such
interest to be payable on demand.  Each Issuing Lender shall give the Borrower
prompt written notice of each Drawing under any Letter of Credit issued by it,
provided that the failure to give any such notice shall in no way affect, impair
or diminish the Borrower’s obligations hereunder.
 
(b)  The obligations of the Borrower under this Section 2.04 to reimburse the
respective Issuing Lender with respect to drawings on Letters of Credit (each, a
“Drawing”) (including, in each case, interest thereon) shall be absolute and
unconditional under any and all circumstances and irrespective of any setoff,
counterclaim or defense to payment which the Borrower may have or have had
against any Lender (including in its capacity as Issuing Lender or Participant
or as Participant), or any non-application or misapplication by the beneficiary
of the proceeds of such Drawing, the respective Issuing Lender’s only obligation
to the Borrower being to confirm that any documents required to be delivered
under such Letter of Credit appear to have been delivered and that they appear
to comply on their face with the requirements of such Letter of Credit.  Subject
to the provisions of the immediately preceding sentence, any action taken or
omitted to be taken by any Issuing Lender under or in connection with any Letter
of Credit if taken or omitted in the absence of gross negligence or willful
misconduct as determined by a court of competent jurisdiction, shall not create
for such Issuing Lender any resulting liability to the Borrower or any other
Credit Party.
 
2.05  Increased Costs.  If at any time after the Effective Date, any Issuing
Lender or any Participant determines that the introduction of or any change in
any applicable law, rule, regulation, order, guideline or request or in the
interpretation or administration thereof by any governmental authority charged
with the interpretation or administration thereof, or compliance by any Issuing
Lender or any Participant with any request or directive by any such authority
(whether or not having the force of  law), shall either (a) impose, modify or
make applicable any reserve, deposit, capital adequacy or similar requirement
against Letters of Credit issued by any Issuing Lender or participated in by any
Participant, or (b) impose on any Issuing Lender or any Participant any other
conditions relating, directly or indirectly, to this Agreement or any Letter of
Credit; and the result of any of the foregoing is to increase the cost to any
 
 
 
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Issuing Lender or any Participant of issuing, maintaining or participating in
any Letter of Credit, or reduce the amount of any sum received or receivable by
any Issuing Lender or any Participant hereunder or reduce the rate of return on
its capital with respect to Letters of Credit, then, upon demand to the Borrower
by such Issuing Lender or any Participant (a copy of which demand shall be sent
by such Issuing Lender or such Participant to the Administrative Agent), the
Borrower agrees to pay to such Issuing Lender or such Participant such
additional amount or amounts as will compensate such Lender for such increased
cost or reduction in the amount receivable or reduction on the rate of return on
its capital.  Any Issuing Lender or any Participant, upon determining that any
additional amounts will be payable pursuant to this Section 2.05, will give
prompt written notice thereof to the Borrower, which notice shall include a
certificate submitted to such Borrower by such Issuing Lender or such
Participant (a copy of which certificate shall be sent by such Issuing Lender or
such Participant to the Administrative Agent), setting forth in reasonable
detail the basis for and the calculation of such additional amount or amounts
necessary to compensate such Issuing Lender or such Participant, although the
failure to give any such notice shall not release or diminish the Borrower’s
obligations to pay additional amounts pursuant to this Section 2.05.  The
certificate required to be delivered pursuant to this Section 2.05 shall, if
delivered in good faith and absent manifest error, be final and conclusive and
binding on the Borrower.
 
SECTION 3.  Commitment Commission; Reductions of Commitment.
 
3.01  Commitment Commission; Fees.  (a)  The Borrower agrees to pay the
Administrative Agent for distribution to each Lender a commitment commission
(the “Commitment Commission”) for the period from the from the Effective Date
until the earlier of (i) the close of secondary syndication or (ii) September
30, 2007, computed at a rate for each day equal to 0.20% per annum on the daily
average Unutilized Commitment of such Lender, and thereafter computed at a rate
for each day equal to (x) 0.250% per annum until the Maturity Date on the daily
average Unutilized Commitment of such Lender.  Accrued Commitment Commission
shall be due and payable quarterly in arrears on each Payment Date and on the
Maturity Date (or such earlier date upon which the Total Commitment is
terminated).
 
(b)  The Borrower agrees to pay to the Administrative Agent for distribution to
each Lender (based on each such Lender’s respective Percentage), a fee in
respect of each Letter of Credit (the “Letter of Credit Fee”) for the period
from and including the date of issuance of such Letter of Credit to and
including the date of termination or expiration of such Letter of Credit,
computed at a rate per annum equal to the Applicable Margin then in effect from
time to time on the daily Stated Amount of each such Letter of Credit.  Accrued
Letter of Credit Fees shall be due and payable quarterly in arrears on each
Payment Date and upon the first day on or after the termination of the Total
Commitment upon which no Letters of Credit remain outstanding.
 
(c)  The Borrower agrees to pay directly to each Issuing Lender, for its own
account, a facing fee in respect of each Letter of Credit issued by it (the
“Facing Fee”) for the period from and including the date of issuance of such
Letter of Credit to and including the date of termination or expiration of such
Letter of Credit, computed at a rate per annum equal to 1/8 of 1% on the daily
Stated Amount of such Letter of Credit, provided that in any event the minimum
amount of Facing Fees payable in any twelve-month period for each Letter of
Credit
 
 
 
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shall be not less than $500; it being agreed that, on the day of issuance of any
Letter of Credit and on each anniversary thereof prior to the termination or
expiration of such Letter of Credit, if $500 will exceed the amount of Facing
Fees that will accrue with respect to such Letter of Credit for the immediately
succeeding twelve-month period, the full $500 shall be payable on the date of
issuance of such Letter of Credit and on each such anniversary thereof.  Except
as otherwise provided in the proviso to the immediately preceding sentence,
accrued Facing Fees shall be due and payable quarterly in arrears on each
Payment Date and upon the first day on or after the termination of the Total
Commitment upon which no Letters of Credit remain outstanding.
 
(d)  The Borrower agrees to pay, upon each payment (including any partial
payment) under, issuance of, extension of, or amendment to, any Letter of Credit
issued hereunder, such amount as shall at the time of such event be the
administrative charge which the respective Issuing Lender is generally charging
in connection with such occurrence with respect to letters of credit.
 
(e)  The Borrower shall pay to the Administrative Agent, for the Administrative
Agent’s own account, such other fees as have been agreed to in writing from time
to time by the Borrower or any of its Subsidiaries and the Administrative Agent.
 
3.02  Voluntary Termination of Unutilized Commitments.  (a)  Upon at least three
Business Days’ prior notice to the Administrative Agent at its Notice Office
(which notice the Administrative Agent shall promptly transmit to each of the
Lenders), the Borrower shall have the right, at any time or from time to time,
without premium or penalty, to terminate or reduce the unutilized Total
Commitment, in whole or in part, in integral multiples of US$5,000,000 in the
case of partial reductions thereto, provided that each such reduction shall
apply proportionately to permanently reduce the Commitment of each Lender.
 
(b)  In the event of certain refusals by a Lender as provided in Section
15.12(b) to consent to certain proposed changes, waivers, discharges or
terminations with respect to this Agreement which have been approved by the
Required Lenders, the Borrower may, subject to the requirements of said Section
15.12(b) and upon five Business Days’ written notice to the Administrative Agent
at its Notice Office (which notice the Administrative Agent shall promptly
transmit to each of the Lenders), terminate the entire Commitment of such Lender
so long as all Loans, together with accrued and unpaid interest, Commitment
Commission and all other amounts, owing to such Lender are repaid concurrently
with the effectiveness of such termination (at which time Schedule I shall be
deemed modified to reflect such changed amounts), and at such time such Lender
shall no longer constitute a “Lender” for purposes of this Agreement, except
with respect to indemnification provisions under this Agreement (including,
without limitation, Sections 1.09, 1.10, 2.05, 4.04, 15.01 and 15.06), which
shall survive as to such repaid Lender.
 
3.03  Mandatory Reduction of Commitments.  (a)  If at any time the aggregate
principal amount outstanding under this Credit Agreement exceeds theTotal
Commitment, an immediate repayment will be required in an amount equal to such
excess.
 
 
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(b)  In addition to any other Commitment reductions required pursuant to this
Section 3.03, but without duplication, the Total Commitment shall terminate upon
a Change of Control.
 
3.04  Scheduled Repayments and Commitment Reductions.  The Total Facility Amount
will be subject to ten (10) consecutive semi-annual reductions of seven percent
(7.0%) of the Total Facility Amount, with the first reduction occurring on the
fifth anniversary of the Effective Date and continuing thereafter until the
Maturity Date at which time the Total Commitments hereunder shall reduce to zero
and the Final Payment will be due by Borrower.
 
SECTION 4.  Prepayments; Payments; Taxes.
 
4.01  Voluntary Prepayments.  The Borrower shall have the right to prepay the
Loans in a pro rata manner, without premium or penalty except as provided by
law, in whole or in part at any time and from time to time on the following
terms and conditions:  
 
(i)  the Borrower shall give the Administrative Agent prior to 12:00 Noon (New
York time) at its Notice Office at least two Business Days’ prior written notice
(or telephonic notice promptly confirmed in writing) of its intent to prepay
such Loans, the amount of such prepayment and the specific Borrowing or
Borrowings pursuant to which made, which notice the Administrative Agent shall
promptly transmit to each of the Lenders;
 
(ii)  each prepayment shall be in an aggregate principal amount of at least
US$10,000,000, provided that no partial prepayment of Loans made pursuant to any
Borrowing under this Section 4.01 shall reduce the outstanding Loans made
pursuant to such Borrowing to an amount less than US$10,000,000;
 
(iii)  at the time of any prepayment of Loans pursuant to this Section 4.01 on
any date other than the last day of the Interest Period applicable thereto, the
Borrower shall pay the amounts required pursuant to Section 1.10;
 
(iv)  in the event of certain refusals by a Lender as provided in
Section 15.12(b) to consent to certain proposed changes, waivers, discharges or
terminations with respect to this Agreement which have been approved by the
Required Lenders, the Borrower may, upon five Business Days’ written notice to
the Administrative Agent at its Notice Office (which notice the Administrative
Agent shall promptly transmit to each of the Lenders), prepay all Loans,
together with accrued and unpaid interest, Commitment Commission, and other
amounts owing to such Lender in accordance with said Section 15.12(b) so long as
(A) the Commitment of such Lender is terminated concurrently with such
prepayment (at which time Schedule I shall be deemed modified to reflect the
changed Commitments) and (B) the consents required by Section 15.12(b) in
connection with the prepayment pursuant to this clause (iv) have been obtained;
and
 
(v)  except as expressly provided in the preceding clause (iv), each prepayment
in respect of any Loans made pursuant to a Borrowing shall be applied prorata
among the Loans comprising such Borrowing.
 
 
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4.02  Mandatory Repayments.  (a)  On any day on which the aggregate outstanding
principal amount of all Loans plus the aggregate amount of all Letter of Credit
Outstandings exceeds the Total Commitment as then in effect (including, without
limitation, as a consequence to Section 3.03), the Borrower shall repay
principal of Loans in an amount equal to such excess.  If, after giving effect
to the prepayment of all outstanding Loans, the aggregate amount of the Letter
of Credit Outstandings exceeds the Total Commitment as then in effect, the
Borrower shall pay to the Collateral Agent on such date an amount of cash or
Cash Equivalents equal to the amount of such excess (up to a maximum amount
equal to the Letter of Credit Outstandings at such time), such cash or Cash
Equivalents to be held as security for all obligations of the Borrower hereunder
in a cash collateral account to be established by the Collateral Agent.
 
(b)  In addition to any other mandatory repayments required pursuant to this
Section 4.02, but without duplication, on (i) the Business Day following the
date of any Collateral Disposition involving a Mortgaged Vessel (other than a
Collateral Disposition constituting an Event of Loss or a Collateral Disposition
in connection with a Vessel Exchange) and (ii) the earlier of (A) the date which
is 180 days following any Collateral Disposition constituting an Event of Loss
involving a Mortgaged Vessel and (B) the date of receipt by the Borrower, any of
its Subsidiaries or the Administrative Agent of the insurance proceeds relating
to such Event of Loss or (iii) the Business Day following the return of a
deposit upon cancellation of a Purchase Contract, the Borrower shall be required
to repay an aggregate principal amount of outstanding Loans and/or cash
collateralize outstanding Letters of Credit in an amount equal to (x) the sum of
the aggregate amount of all outstanding Loans and Letter of Credit Outstandings
multiplied by a fraction (A) the numerator of which is equal to the Appraised
Value determined on the date of such Collateral Disposition of the Mortgaged
Vessel or Mortgaged Vessels which is/are the subject of such Collateral
Disposition and (B) the denominator of which is equal to the Aggregate Appraised
Value on such date or, (y) in the case of the mutual cancellation of a Purchase
Contract or a default by a seller thereunder, an amount equal to the deposit
made thereunder.  In addition, in the event of a sale of any Pledged Shares in
Jinhui by Borrower, the Borrower shall within one Business Day after the day the
proceeds of each such sale are converted from Norwegian Kroner into United
States Dollars (and received by the Borrower after termination of the relevant
swap in relation thereto), prepay the outstanding Loans in an aggregate amount
up to Seventy Seven Million United States Dollars (US$77,000,000), together with
customary breakage costs, if applicable.
 
(c)  With respect to each repayment of Loans required by this Section 4.02, the
Borrower may designate the specific Borrowing or Borrowings pursuant to which
such Loans were made, provided that (i) all Loans with Interest Periods ending
on such date of required repayment shall be paid in full prior to the payment of
any other Loans and (ii) each repayment of any Loans comprising a Borrowing
shall be applied pro rata among such Loans.  In the absence of a designation by
the Borrower as described in the preceding sentence, the Administrative Agent
shall, subject to the preceding provisions of this clause (b), make such
designation in its sole reasonable discretion with a view, but no obligation, to
minimize breakage costs owing pursuant to Section 1.10.
 
 
 
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(d)  Notwithstanding anything to the contrary contained elsewhere in this
Agreement, all then outstanding Loans and Unpaid Drawings shall be repaid in
full on the Maturity Date.
 
4.03  Application of Net Cash Flows.  Commencing with the quarter ending
September 30, 2007, within one Business Day after the payment of the aggregate
amount of declared Dividends by the Borrower or any Subsidiary Guarantor with
respect to such fiscal quarter, the Borrower or such Subsidiary Guarantor shall
apply Six Million Two Hundred Fifty Thousand United States Dollars
(US$6,250,000) or such lesser amount as shall be available from Net Cash Flow,
if available and generated in such fiscal quarter, to reduce outstanding
Loans.  The required payments with respect to Net Cash Flows shall continue
until the Borrower or such Subsidiary Guarantor completes a follow-on equity
offering resulting in net proceeds to the Borrower of no less than Two Hundred
Million United States Dollars (US$200,000,000).
 
4.04  Method and Place of Payment.  (a)  Except as otherwise specifically
provided herein, all payments under this Agreement or any Note shall be made to
the Administrative Agent for the account of the Lender or Lenders entitled
thereto not later than 12:00 Noon (New York time) on the date when due and shall
be made in Dollars in immediately available funds at the Payment Office of the
Administrative Agent.  Whenever any payment to be made hereunder or under any
Note shall be stated to be due on a day which is not a Business Day, the due
date thereof shall be extended to the next succeeding Business Day and, with
respect to payments of principal, interest shall be payable at the applicable
rate during such extension.
 
4.05  Net Payments; Taxes.  (a)  All payments made by any Credit Party hereunder
or under any Note will be made without setoff, counterclaim or other defense.
All such payments will be made free and clear of, and without deduction or
withholding for, any present or future taxes, levies, imposts, duties, fees,
assessments or other charges of whatever nature now or hereafter imposed by any
jurisdiction or by any political subdivision or taxing authority thereof or
therein with respect to such payments (but excluding, except as provided in the
second succeeding sentence, any tax imposed on or measured by the net income or
net profits (or any franchise tax or similar tax imposed in lieu thereof), net
profits or net worth of a Lender, in each case pursuant to the laws of the
jurisdiction in which it is organized or the jurisdiction in which the principal
office or applicable lending office of such Lender is located or any subdivision
thereof or therein) and all interest, penalties or similar liabilities with
respect to such non-excluded taxes, levies, imposts, duties, fees, assessments
or other charges (all such non-excluded taxes, levies, imposts, duties, fees,
assessments or other charges being referred to collectively as “Taxes”).  If any
Taxes are so levied or imposed, the Borrower agrees to pay the full amount of
such Taxes, and such additional amounts as may be necessary so that every
payment of all amounts due under this Agreement or under any Note, after
withholding or deduction for or on account of any Taxes, will not be less than
the amount provided for herein or in such Note.  If any amounts are payable in
respect of Taxes pursuant to the preceding sentence, the Borrower agrees to
reimburse each Lender within three days of the written request of such Lender,
for taxes imposed on or measured by the net income, net profits or any franchise
tax based on net income, net profits or net worth of such Lender, in each case
pursuant to the laws of the jurisdiction in which such Lender is organized or in
which the principal office or applicable lending office of such Lender is
located or under the laws of any political subdivision or taxing
 
 
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authority of any such jurisdiction in which such Lender is organized or in which
the principal office or applicable lending office of such Lender is located and
for any withholding of taxes as such Lender shall determine are payable by, or
withheld from, such Lender, in respect of such amounts so paid to or on behalf
of such Lender pursuant to the preceding sentence and in respect of any amounts
paid to or on behalf of such Lender pursuant to this sentence.  The Borrower
will furnish to the Administrative Agent within 45 days after the date of
payment of any Taxes is due pursuant to applicable law certified copies of tax
receipts evidencing such payment by the Borrower.  The Borrower agrees to
indemnify and hold harmless each Lender, and reimburse such Lender upon its
written request, for the amount of any Taxes so levied or imposed and paid by
such Lender.
 
(b)  Each Lender agrees to use reasonable efforts (consistent with legal and
regulatory restrictions and subject to overall policy considerations of such
Lender) to file any certificate or document or to furnish to the Borrower any
information as reasonably requested by the Borrower that may be necessary to
establish any available exemption from, or reduction in the amount of, any
Taxes; provided, however, that nothing in this Section 4.04(b) shall require a
Lender to disclose any confidential information (including, without limitation,
its tax returns or its calculations).
 
(c)  If the Borrower pays any additional amount under this Section 4.04 to a
Lender and such Lender determines in its sole discretion that it has actually
obtained or utilized in connection therewith any refund or any reduction of, or
credit against, its Tax liabilities in or with respect to the taxable year in
which the additional amount is paid (a “Tax Benefit”), such Lender shall pay to
the Borrower an amount that such Lender shall, in its sole discretion, determine
is equal to the net benefit, after tax, which was obtained by such Lender in
such year as a consequence of such Tax Benefit; provided, however, that (i) any
Lender may determine, in its sole discretion consistent with the policies of
such Lender, whether to seek a Tax Benefit, (ii) any Taxes that are imposed on a
Lender as a result of a disallowance or reduction (including through the
expiration of any tax credit carryover or carryback of such Lender that
otherwise would not have expired) of any Tax Benefit with respect to which such
Lender has made a payment to the Borrower pursuant to this Section 4.04(c) shall
be treated as a Tax for which the Borrower is obligated to indemnify such Lender
pursuant to this Section 4.04 without any exclusions or defenses, (iii) nothing
in this Section 4.04(c) shall require any Lender to disclose any confidential
information to the Borrower (including, without limitation, its tax returns),
and (iv) no Lender shall be required to pay any amounts pursuant to this Section
4.04(c) at any time during which a Default or an Event of Default exists.
 
(d)  No provision of this Agreement will:
 
(i)  interfere with the right of any Lender to arrange its affairs (tax or
otherwise) in whatever manner it thinks fit (excluding Section 1.09(a)(ii) or
(iii), Section 1.09(b), Section 2.05 or this Section 4.04);
 
(ii)  oblige any Lender to investigate or claim any credit, relief, remission or
repayment available to it or the extent, order and manner of any claim; or
 
 
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(iii)  oblige any Lender to disclose any information relating to its affairs
(tax or otherwise) or any computations in respect of Tax.
 
SECTION 5.  Conditions Precedent to the Initial Borrowing Date.  The obligation
of each Lender to make the Loan in respect of the Capesize Vessel Deposit on the
Initial Borrowing Date and the obligation of any Issuing Lender to issue any
Letter of Credit  is subject at the time of the making of such Loans and/or the
issuance of such Letter of Credit to the satisfaction or waiver of the following
conditions:
 
5.01  Existing Credit Agreement.  On or prior to the Initial Borrowing Date, the
Borrower shall provide evidence satisfactory to the Administrative Agent that
the Borrower has cancelled the unutilized commitment of the Existing Credit
Agreement and has issued irrevocable notice of its intention to prepay amounts
owing under the Existing Credit Facility and terminate the same within ten (10)
days of the Effective Date.
 
5.02  Revolving Credit Agreement.  On or prior to the Initial Borrowing Date,
the Borrower shall provide evidence satisfactory to the Administrative Agent
that the Borrower has cancelled the unutilized commitment of the Revolving
Credit Agreement and has issued irrevocable notice of its intention to prepay
amounts owing under the Revolving Credit Facility and terminate the same within
ten (10) days of the Effective Date.
 
5.03  Assignments of Purchase Contracts and Escrow Deposit.  The Borrower and/or
the relevant Subsidiary Guarantors as applicable has executed and delivered to
the Collateral Agent the Assignments of Purchase Contracts in respect of the
Capesize Vessels and all notices and consents required thereunder.
 
5.04  Opinions of Counsel.  (a)  On the Initial Borrowing Date, the
Administrative Agent shall have received from Kramer Levin Naftalis & Frankel
LLP, special New York counsel to the Borrower and its Subsidiaries, an opinion
addressed to the Administrative Agent and each of the Lenders and dated the
Initial Borrowing Date which shall be in form and substance acceptable to the
Mandated Lead Arranger.
 
(b)  On the Initial Borrowing Date, the Administrative Agent shall have received
from Reeder & Simpson P.C., special Marshall Islands counsel to the Borrower and
its Subsidiaries, an opinion addressed to the Administrative Agent and each of
the Lenders and dated the Initial Borrowing Date which shall be in form and
substance acceptable to the Mandated Lead Arranger.
 
5.05  Corporate Documents; Proceedings; etc.  (a)  On the Initial Borrowing
Date, the Mandated Lead Arranger shall have received a certificate, dated the
Initial Borrowing Date, signed by an Authorized Officer, member or general
partner of each Credit Party, and attested to by the secretary or any assistant
secretary (or, to the extent such Credit Party does not have a secretary or
assistant secretary, the analogous Person within such Credit Party) of such
Credit Party, as the case may be, in substantially the form of Exhibit D, with
appropriate insertions, together with copies of the Certificate of Incorporation
and By-Laws (or equivalent organizational documents) of such Credit Party and
the resolutions of such Credit Party referred to in such certificate, and the
foregoing shall be reasonably acceptable to the Mandated Lead Arranger.
 
 
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(b)  All corporate, limited liability company, partnership and legal
proceedings, and all material instruments and agreements in connection with the
transactions contemplated by this Agreement and the other Documents, shall be
reasonably satisfactory in form and substance to the Mandated Lead Arranger, and
the Mandated Lead Arranger shall have received all information and copies of all
documents and papers, including records of corporate, limited liability company
and partnership proceedings, governmental approvals and good standing
certificates which the Mandated Lead Arranger may have reasonably requested in
connection therewith, such documents and papers, where appropriate, to be
certified by proper corporate or governmental authorities.
 
5.06  Subsidiaries Guaranty.  On the Initial Borrowing Date, each Subsidiary of
the Borrower shall have duly authorized and, in the case of each of the
Subsidiary Guarantors that is a party to a Purchase Contract, executed and
delivered to the Administrative Agent a Guaranty substantially in the form of
Exhibit E (as modified, supplemented or amended from time to time, the
“Guaranty”), and the Guaranty shall be in full force and effect.
 
5.07  Pledge and Security Agreement.  On the Initial Borrowing Date, the
Borrower and each of the Subsidiary Guarantors that is a party to a Purchase
Contract shall have (x) duly authorized, executed and delivered a Pledge and
Security Agreement substantially in the form of Exhibit F (as modified,
supplemented or amended from time to time, the “Pledge Agreement”) and shall
have (A) delivered to the Collateral Agent, as pledgee, all the Pledged
Securities (as defined in the Pledge Agreement), together with executed and
undated stock powers in the case of capital stock constituting Pledged
Securities, and (B) otherwise complied with all of the requirements set forth in
the Pledge Agreement and (y) duly authorized, executed and delivered any other
related documentation necessary or advisable to perfect the Lien on the Pledge
Agreement Collateral referred to therein in the respective jurisdictions of
formation of the respective Subsidiary Guarantor or the Borrower, as the case
may be.
 
5.08  Solvency Certificate.  On the Initial Borrowing Date, the Borrower shall
have caused to be delivered to the Mandated Lead Arranger a solvency certificate
from the senior financial officer of the Borrower, in the form of Exhibit G,
which shall be addressed to the Administrative Agent and each of the Lenders and
dated the Initial Borrowing Date, setting forth the conclusion that, after
giving effect to the incurrence of all the financings contemplated hereby, the
Borrower individually, and the Borrower and its Subsidiaries taken as a whole,
are not insolvent and will not be rendered insolvent by the incurrence of such
indebtedness, and will not be left with unreasonably small capital with which to
engage in their respective businesses and will not have incurred debts beyond
their ability to pay such debts as they mature.
 
5.09  Approvals.  On or prior to the Initial Borrowing Date, all necessary
governmental (domestic and foreign) and third party approvals and/or consents in
connection with the Loans, and the granting of Liens under the Credit Documents,
if any, shall have been obtained and remain in effect, and all applicable
waiting periods with respect thereto shall have expired without any action being
taken by any competent authority which restrains, prevents or imposes materially
adverse conditions upon the making of the Loans and the performance by the
 
 
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Credit Parties of the Credit Documents.  On the Initial Borrowing Date, there
shall not exist any judgment, order, injunction or other restraint issued or
filed or a hearing seeking injunctive relief or other restraint pending or
notified prohibiting or imposing materially adverse conditions upon the making
of the Loans or the performance by the Credit Parties of the Credit Documents.
 
5.10  Litigation.  On the Initial Borrowing Date, no actions, suits,
investigations or proceedings of any Credit Party by any entity (private or
governmental) shall be pending or, to the knowledge of any Credit Party,
threatened with respect to (i) any Document, (ii) any Subsidiary Guarantor which
could (i) either individually or in the aggregate, reasonably be expected to
have a Material Adverse Effect, or (ii) which the Mandated Lead Arranger shall
determine could be reasonably expected to have a Material Adverse Effect.
 
5.11  Material Adverse Effect.  On the Initial Borrowing Date, nothing shall
have occurred (and neither the Mandated Lead Arranger nor any of the Lenders
shall have become aware of facts or conditions not previously known to them)
which any Agent or the Required Lenders shall determine has had, or could
reasonably be expected to have, a Material Adverse Effect.
 
5.12  Environmental Laws.  On the Initial Borrowing Date, there shall not exist
any condition or occurrence on or arising from any Existing Vessel or property
owned or operated or occupied by the Borrower or any of its Subsidiaries that
(a) results in noncompliance by the Borrower or such Subsidiary with any
applicable Environmental Law that has had, or could reasonably be expected to
have, a Material Adverse Effect or (b) could reasonably be expected to form the
basis of a Environmental Claim against the Borrower or any of its Subsidiaries
or any such Existing Vessel or property, which in any such case individually or
in the aggregate could reasonably be expected to have a Material Adverse Effect.
 
5.13  Fees.  On the Initial Borrowing Date, the Borrower shall have paid to the
Administrative Agent, the Mandated Lead Arranger or the Lenders all costs, fees
and expenses as set out in the Fee Letter.
 
5.14  No Conflicts.  (a)  On the Initial Borrowing Date, there shall be no
material default under, and the transactions contemplated hereby shall not give
rise to a material conflict with, any material agreement of the Borrower or any
of its Subsidiaries.
 
(b)  On the Initial Borrowing Date, all Loans shall be in full compliance with
all applicable requirements of law, including, without limitation, Regulations
T, U and X.
 
SECTION 6.  Conditions Precedent to the Refinancing Loan.  
 
The obligation of each Lender to make the Refinancing Loan is subject at the
time of the making of such Loans and/or the issuance of such Letter of Credit to
the satisfaction or waiver of the following conditions:
 
6.01  Subsidiary Guarantors.  The Subsidiary Guarantors owning Existing Vessels
shall execute and deliver the Guaranty.
 
 
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6.02  Repayment of Outstanding Indebtedness.  On or prior to the Borrowing Date
in respect of the Refinancing Loan, Borrower shall provide evidence satisfactory
to the Administrative Agent that the Refinancing Loan will be used to repay all
outstanding indebtedness under the Existing Credit Agreement and the Revolving
Credit Agreement and all security interests granted in connection therewith will
be released.
 
6.03  Opinions of Counsel.  
 
(a)  On or prior to the Borrowing Date in respect of the Refinancing Loan, the
Administrative Agent shall have received from Kramer Levin Naftalis & Frankel
LLP, special New York counsel to the Borrower and its Subsidiaries (including
the guarantors), an opinion addressed to the Administrative Agent and each of
the Lenders and dated the Initial Borrowing Date which shall be in form and
substance reasonably acceptable to the Mandated Lead Arranger;
 
(b)  On or prior to the Borrowing Date in respect of the Refinancing Loan, the
Administrative Agent shall have received from Reeder & Simpson P.C., special
Marshall Islands counsel to the Borrower and its Subsidiaries (including, but
not limited to, any Subsidiary that becomes a Subsidiary Guarantor subsequent to
the Effective Date), addressed to the Administrative Agent and each of the
Lenders and dated such Borrowing Date which shall be in form and substance
reasonably acceptable to the Mandated Lead Arranger.
 
6.04  Litigation.  On or prior to the Borrowing Date in respect of the
Refinancing Loan, no actions, suits, investigations or proceedings of any Credit
Party by any entity (private or governmental) shall be pending or, to the
knowledge of any Credit Party, threatened with respect to (i) any Document ,
(ii) any Subsidiary Guarantor which could (i) either individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect, or
(ii) which the Mandated Lead Arranger shall determine could be reasonably
expected to have a Material Adverse Effect.
 
6.05  Material Adverse Effect.  On or prior to the Borrowing Date in respect of
the Refinancing Loan, nothing shall have occurred (and neither the Mandated Lead
Arranger nor any of the Lenders shall have become aware of facts or conditions
not previously known to them) which any Agent or the Required Lenders shall
determine has had, or could reasonably be expected to have, a Material Adverse
Effect.
 
SECTION 7.  Conditions Subsequent to the Effective Date.  No later than the
Collateral Delivery Date, the Borrower shall procure the following in respect of
the Subsidiary Guarantors owning Existing Vessels, the Existing Vessels and
matters related thereto:
 
7.01  Opinions of Counsel.  (i) the Administrative Agent shall have received
from Kramer Levin Naftalis & Frankel LLP, special New York counsel to the
Borrower and its Subsidiaries, an opinion addressed to the Administrative Agent
and each of the Lenders and dated such Collateral Delivery Date which shall
(x) be in form and substance reasonably acceptable to the Mandated Lead Arranger
and (y) cover the perfection of the security interests (other than those to be
covered by opinions delivered pursuant to clauses (ii) through (iii) below)
 
 
 
 
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granted pursuant to the Security Documents and such other matters incidental to
the transactions contemplated herein as the Mandated Lead Arranger may
reasonably request;
 
(ii)  the Administrative Agent shall have received from Reeder & Simpson P.C.,
special Marshall Islands counsel to the Borrower and its Subsidiaries (or such
other counsel reasonably satisfactory to the Administrative Agent), an opinion
addressed to the Administrative Agent and each of the Lenders and dated such
Collateral Delivery Date which shall (x) be in form and substance reasonably
acceptable to the Mandated Lead Arranger and (y) cover the perfection of the
security interests granted pursuant to the Vessel Mortgages and such other
matters incidental thereto as the Mandated Lead Arranger may reasonably request;
and
 
(iii)  the Administrative Agent shall have received from (1) if the relevant
Existing Vessel is to be registered under Hong Kong flag, Johnson Stokes &
Master, special Hong Kong counsel to the Administrative Agent, (2) if the
relevant Existing Vessel is to be registered under the Marshall Islands flag,
Reeder & Simpson P.C., special Marshall Islands counsel to the Borrower, (3)
Constantine P. Georgiopoulos, special New York maritime counsel to the Borrower
and its Subsidiaries or (4) if the relevant Existing Vessel is to be registered
in an Acceptable Flag Jurisdiction other than Hong Kong or the Marshall Islands,
special counsel to the Administrative Agent of such Acceptable Flag
Jurisdiction, which shall be reasonably acceptable to the Administrative Agent,
an opinion addressed to the Administrative Agent and each of the Lenders and
dated such Collateral Delivery Date, which shall (x) be in form and substance
reasonably acceptable to the Administrative Agent and (y) cover the perfection
of the security interests granted pursuant to the Vessel Mortgage(s) and such
other matters incident thereto as the Administrative Agent may reasonably
request.
 
7.02  Corporate Documents; Proceedings; etc.  (i)  The Mandated Lead Arranger
shall have received a certificate, dated such date, signed by an Authorized
Officer, member or general partner of the Credit Party owning or operating the
Existing Vessel, and attested to by the secretary or any assistant secretary
(or, to the extent such Credit Party does not have a secretary or assistant
secretary, the analogous Person within such Credit Party) of such Credit Party,
as the case may be, in the form of Exhibit D, with appropriate insertions,
together with copies of any changes to the Certificate of Incorporation and
By-Laws (or equivalent organizational documents) of such Credit Party for
certifying there have been no changes thereto or to the resolutions of such
Credit Party referred to in such certificate, and the foregoing shall be
reasonably acceptable to the Mandated Lead Arranger.
 
(ii)  All corporate, limited liability company, partnership and legal
proceedings, and all material instruments and agreements in connection with the
transactions contemplated by this Agreement, shall be reasonably satisfactory in
form and substance to the Mandated Lead Arranger, and the Mandated Lead Arranger
shall have received all information and copies of all documents and papers,
including records of corporate, limited liability company and partnership
proceedings, governmental approvals and good standing certificates, if any,
which the Mandated Lead Arranger may have reasonably requested in connection
therewith, such documents and papers, where appropriate, to be certified by
proper corporate or governmental authorities.
 
 
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7.03  Pledge and Security Agreement.  Each Credit Party which owns or operates a
Existing Vessel shall have (x) duly authorized, executed and delivered the
Pledge Agreement and shall have (A) delivered to the Collateral Agent, as
pledgee, all the Pledged Securities referred to therein, together with executed
and undated stock powers in the case of capital stock constituting Pledged
Securities, and (B) otherwise complied with all of the requirements set forth in
the Pledge Agreement and (y) duly authorized, executed and delivered any other
related documentation necessary or advisable to perfect the Lien on the Pledge
Agreement Collateral referred to therein in the respective jurisdictions of
formation of the respective Subsidiary Guarantor and the Borrower shall have
executed and delivered to the Administrative Agent the Jinhui Pledge in such
form reasonably acceptable to the Administrative Agent.
 
7.04  Assignments of Earnings, Insurances and Charter.  Each Credit Party which
owns or operates a Existing Vessel shall have duly authorized, executed and
delivered an Assignment of Earnings, an Assignment of Insurances and an
Assignment of Charters, together covering all of such Credit Party’s present and
future Earnings and Insurance Collateral, in each case together with:
 
(i)  proper Financing Statements (Form UCC-1) fully executed for filing under
the UCC or in other appropriate filing offices of each jurisdiction as may be
necessary, or in the reasonable opinion of the Collateral Agent desirable, to
perfect the security interests purported to be created by the Assignment of
Earnings, Assignment of Charters and the Assignment of Insurances;
 
(ii)  certified copies of Requests for Information or Copies (Form UCC-11), or
equivalent reports, listing all effective financing statements that name such
Credit Party as debtor and that are filed in the jurisdictions referred to in
Section 7.04(i) above, together with copies of such other financing statements
(none of which shall cover the Collateral except to the extent evidencing
Permitted Liens unless in respect of which the Collateral Agent shall have
received Form UCC-3 Termination Statements (or such other termination statements
as shall be required by local law) fully executed for filing if required by
applicable laws); and
 
(iii)  evidence that all other actions necessary, or in the reasonable opinion
of the Collateral Agent desirable, to perfect and protect the security interests
purported to be created by the Assignment of Earnings, the Assignment of
Insurances and the Assignment of Charters have been taken.
 
7.05  Control Agreement.  The Borrower, each Subsidiary Guarantor, the
Collateral Agent and Nordea Bank Finland PLC, New York Branch, as deposit bank
shall have duly executed and delivered a Control Agreement in the form attached
to the Pledge Agreement with respect to each Operating Account.
 
7.06  Mortgages.  Each Credit Party which owns or operates a Existing Vessel
shall have duly authorized, executed and delivered, and caused to be recorded in
the appropriate vessel registry, a Vessel Mortgage with respect to each Existing
Vessel owned or operated by such Credit Party on such date and such Vessel
Mortgages shall be effective to create in favor of
 
 
 
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the Collateral Agent and/or the Lenders a legal, valid and enforceable first
priority security interest in and lien upon such Vessels, subject only to
Permitted Liens.  Except as specifically provided above, all filings, deliveries
of instruments and other actions necessary or desirable in the reasonable
opinion of the Collateral Agent to perfect and preserve such security interests
shall have been duly effected and the Collateral Agent shall have received
evidence thereof in form and substance reasonably satisfactory to the Collateral
Agent.
 
7.07  Certificates of Ownership; Searches; Class Certificates; Appraisal
Reports; Mortgages.  The Administrative Agent shall have received each of the
following with respect to each Existing Vessel owned or operated by a Credit
Party:
 
(i)  certificates of ownership from appropriate authorities showing (or
confirmation updating previously reviewed certificates and indicating) the
registered ownership of such Existing Vessel by the relevant Subsidiary
Guarantor;
 
(ii)  the results of maritime registry searches with respect to such Existing
Vessel, indicating no record liens other than Liens in favor of the Collateral
Agent and/or the Lenders, Permitted Liens and Liens being discharged
contemporaneously with such acquisition;
 
(iii)  class certificates from a classification society listed on Schedule IX
hereto or another internationally recognized classification society acceptable
to the Collateral Agent, indicating that such Existing Vessel meets the criteria
specified in Section 9.23;
 
(iv)  Appraisals from at least two Approved Appraisers of such Existing Vessel
of recent date in scope, form and substance reasonably satisfactory to the
Administrative Agent; and
 
(v)  a report, in form and scope reasonably satisfactory to the Administrative
Agent, from a firm of independent marine insurance brokers reasonably acceptable
to the Administrative Agent with respect to the insurance maintained by the
Credit Parties in respect of such Existing Vessel, together with a certificate
from such broker certifying that such insurances (i) are placed with such
insurance companies and/or underwriters and/or clubs, in such amounts, against
such risks, and in such form, as are customarily insured against by similarly
situated insureds for the protection of the Administrative Agent and/or the
Lenders as mortgagee and (ii) conform with the insurance requirements of the
respective Vessel Mortgage.
 
7.08  Management and Service Agreements.  There shall have been delivered to the
Administrative Agent or its counsel true and correct copies of the following
documents:
 
(i)  all Management Agreements with respect to the Subsidiary Guarantor of each
Existing Vessel not delivered on or prior to the Collateral Delivery Date; and
 
(ii)  all Service Agreements entered into between the Borrower and its
Subsidiaries not delivered on or prior to the Collateral Delivery Date;
 
 
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all of which Management Agreements and Service Agreements shall be in form and
substance reasonably satisfactory to the Mandated Lead Arranger and shall be in
full force and effect on such Collateral Delivery Date.
 
7.09  Environmental Laws.  There shall not exist any condition or occurrence on
or arising from any Existing Vessel or property owned or operated or occupied by
the Borrower or any of its Subsidiaries that (a) results in noncompliance by the
Borrower or such Subsidiary with any applicable Environmental Law that has had,
or could reasonably be expect to have, a Material Adverse Effect or (b) could
reasonably be expected to form the basis of a Environmental Claim against the
Borrower or any of its Subsidiaries or any property (including, without
limitation, the related Existing Vessel), which in any such case individually or
in the aggregate could reasonably be expected to have a Material Adverse Effect.
 
SECTION 8.  Conditions Precedent.
 
8.01  Conditions Precedent to all Credit Events.  The obligation of each Lender
to make Loans on each Borrowing Date (including Loans made on the Initial
Borrowing Date), and the obligation of any Issuing Lender to issue any Letter of
Credit (each, a “Credit Event”) is subject at the time of such Credit Event to
the satisfaction or waiver of the following conditions:
 
(a)  No Default; Representations and Warranties.  At the time of such Credit
Event and also after giving effect thereto (i) there shall exist no Default or
Event of Default and (ii) all representations and warranties contained herein or
in any other Credit Document shall be true and correct in all material respects
both before and after giving effect to such Credit Event with the same effect as
though such representations and warranties had been made on the date of such
Credit Event (it being understood and agreed that any representation or warranty
which by its terms is made as of a specified date shall be required to be true
and correct in all material respects only as of such specified date).
 
(b)  Notice of Borrowing; Letter of Credit Request.  (i)  Prior to such Loan,
the Administrative Agent shall have received a Notice of Borrowing required by
Section 1.03(a).
 
(ii)  Prior to the issuance of each Letter of Credit, the Administrative Agent
and the respective Issuing Lender shall have received a Letter of Credit Request
meeting the requirements of Section 2.02.
 
(c)  Aggregate Amount of Loans and Letters of Credit.  (i)  On each Borrowing
Date following the Borrowing Date for the Refinancing Loan, the aggregate
Appraised Value of the Mortgaged Vessels shall be at least 130% of the aggregate
amount of all Loans and Letter of Credit Outstandings (determined on a pro forma
basis giving effect to such Loan being made and/or Letter of Credit being
issued).
 
(ii)  On each Borrowing Date, the aggregate amount of all Loans which are then
outstanding (determined on a proforma basis giving effect to such Loan being
made), the proceeds of which have been used or will be used to fund working
capital requirements of the Borrower and its Subsidiaries, shall not exceed
$50,000,000.
 
 
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(iii)  On each Borrowing Date, the aggregate amount of Letters of Credit
Outstandings (determined on a pro forma basis giving effect to such Letters of
Credit being issued) shall not exceed $50,000,000.
 
8.02  Conditions Precedent to all Vessel Acquisition Loans.  The obligation of
each Lender to make Vessel Acquisition Loans to the Borrower the proceeds of
which shall be utilized to fund the acquisition of Additional Vessels is subject
at the time of making such Vessel Acquisition Loans to the satisfaction or
waiver of the following conditions:
 
(a)  Opinions of Counsel.  (i)  On each Borrowing Date of a Vessel Acquisition
Loan (each a “Vessel Acquisition Borrowing Date”), the Administrative Agent
shall have received from Kramer Levin Naftalis & Frankel LLP, special New York
counsel to the Borrower and its Subsidiaries, an opinion addressed to the
Administrative Agent and each of the Lenders and dated such Borrowing Date which
shall (x) be in form and substance reasonably acceptable to the Mandated Lead
Arranger and (y) cover the perfection of the security interests (other than
those to be covered by opinions delivered pursuant to clauses (ii) through (iii)
below) granted pursuant to the Security Documents and such other matters
incidental to the transactions contemplated herein as the Mandated Lead Arranger
may reasonably request;
 
(ii)  On each Vessel Acquisition Borrowing Date, the Administrative Agent shall
have received from Reeder & Simpson P.C., special Marshall Islands counsel to
the Borrower and its Subsidiaries (or such other counsel reasonably satisfactory
to the Administrative Agent), an opinion addressed to the Administrative Agent
and each of the Lenders and dated such Borrowing Date which shall (x) be in form
and substance reasonably acceptable to the Mandated Lead Arranger and (y) cover
the perfection of the security interests granted pursuant to the Vessel
Mortgages and such other matters incidental thereto as the Mandated Lead
Arranger may reasonably request; and
 
(iii)  On each Vessel Acquisition Borrowing Date, the Administrative Agent shall
have received from (1) if the relevant Additional Vessel is to be registered
under Hong Kong flag, Johnson Stokes & Master, special Hong Kong counsel to the
Administrative Agent, (2) if the relevant Additional Vessel is to be registered
under the Marshall Islands flag, Reeder & Simpson P.C., special Marshall Islands
counsel to the Borrower, (3) Constantine P. Georgiopoulos, special New York
maritime counsel to the Borrower and its Subsidiaries or (4) if the relevant
Additional Vessel is to be registered in an Acceptable Flag Jurisdiction other
than Hong Kong or the Marshall Islands, special counsel to the Administrative
Agent of such Acceptable Flag Jurisdiction, which shall be reasonably acceptable
to the Administrative Agent, an opinion addressed to the Administrative Agent
and each of the Lenders and dated such Borrowing Date, which shall (x) be in
form and substance reasonably acceptable to the Administrative Agent and
(y) cover the perfection of the security interests granted pursuant to the
Vessel Mortgage(s) and such other matters incident thereto as the Administrative
Agent may reasonably request.
 
(b)  Corporate Documents; Proceedings; etc.  (i)  On each Vessel Acquisition
Borrowing Date, the Mandated Lead Arranger shall have received a certificate,
dated such Borrowing Date, signed by an Authorized Officer, member or general
partner of the Credit Party consummating the Vessel Acquisition on such date,
and attested to by the secretary or any
 
 
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assistant secretary (or, to the extent such Credit Party does not have a
secretary or assistant secretary, the analogous Person within such Credit Party)
of such Credit Party, as the case may be, in the form of Exhibit D, with
appropriate insertions, together with copies of the Certificate of Incorporation
and By-Laws (or equivalent organizational documents) of such Credit Party and
the resolutions of such Credit Party referred to in such certificate, and the
foregoing shall be reasonably acceptable to the Mandated Lead Arranger.
 
(ii)  All corporate, limited liability company, partnership and legal
proceedings, and all material instruments and agreements in connection with the
transactions contemplated by this Agreement, shall be reasonably satisfactory in
form and substance to the Mandated Lead Arranger, and the Mandated Lead Arranger
shall have received all information and copies of all documents and papers,
including records of corporate, limited liability company and partnership
proceedings, governmental approvals and good standing certificates, if any,
which the Mandated Lead Arranger may have reasonably requested in connection
therewith, such documents and papers, where appropriate, to be certified by
proper corporate or governmental authorities.
 
(c)  Subsidiaries Guaranty.  On each Vessel Acquisition Borrowing Date, each
Subsidiary of the Borrower which is consummating a Vessel Acquisition on such
date shall have duly authorized, executed and delivered to the Administrative
Agent the Guaranty, and the Guaranty shall be in full force and effect.
 
(d)  Pledge and Security Agreement.  On each Vessel Acquisition Borrowing Date,
each Credit Party which is consummating a Vessel Acquisition on such date shall
have (x) duly authorized, executed and delivered the Pledge Agreement and shall
have (A) delivered to the Collateral Agent, as pledgee, all the Pledged
Securities referred to therein, together with executed and undated stock powers
in the case of capital stock constituting Pledged Securities, and (B) otherwise
complied with all of the requirements set forth in the Pledge Agreement and
(y) duly authorized, executed and delivered any other related documentation
necessary or advisable to perfect the Lien on the Pledge Agreement Collateral
referred to therein in the respective jurisdictions of formation of the
respective Subsidiary Guarantor.
 
(e)  Assignments of Earnings, Insurances and Charter.  On each Vessel
Acquisition Borrowing Date, each Credit Party which is consummating a Vessel
Acquisition on such date shall have duly authorized, executed and delivered an
Assignment of Earnings, an Assignment of Insurances and an Assignment of
Charters, together covering all of such Credit Party’s present and future
Earnings and Insurance Collateral, in each case together with:
 
(i)  proper Financing Statements (Form UCC-1) fully executed for filing under
the UCC or in other appropriate filing offices of each jurisdiction as may be
necessary, or in the reasonable opinion of the Collateral Agent desirable, to
perfect the security interests purported to be created by the Assignment of
Earnings, Assignment of Charters and the Assignment of Insurances;
 
(ii)  certified copies of Requests for Information or Copies (Form UCC-11), or
equivalent reports, listing all effective financing statements that name such
Credit Party as debtor and that are filed in the jurisdictions referred to in
Section 8.02(e)(i) above, together
 
 
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with copies of such other financing statements (none of which shall cover the
Collateral except to the extent evidencing Permitted Liens unless in respect of
which the Collateral Agent shall have received Form UCC-3 Termination Statements
(or such other termination statements as shall be required by local law) fully
executed for filing if required by applicable laws); and
 
(iii)  evidence that all other actions necessary, or in the reasonable opinion
of the Collateral Agent desirable, to perfect and protect the security interests
purported to be created by the Assignment of Earnings, the Assignment of
Insurances and the Assignment of Charters have been taken.
 
(f)  Mortgages.  On each Vessel Acquisition Borrowing Date, each Credit Party
which is consummating a Vessel Acquisition on such date shall have duly
authorized, executed and delivered, and caused to be recorded in the appropriate
vessel registry, a Vessel Mortgage with respect to each of the Additional
Vessels being acquired by such Credit Party on such Borrowing Date and such
Vessel Mortgages shall be effective to create in favor of the Collateral Agent
and/or the Lenders a legal, valid and enforceable first priority security
interest in and lien upon such Vessels, subject only to Permitted Liens.  Except
as specifically provided above, all filings, deliveries of instruments and other
actions necessary or desirable in the reasonable opinion of the Collateral Agent
to perfect and preserve such security interests shall have been duly effected
and the Collateral Agent shall have received evidence thereof in form and
substance reasonably satisfactory to the Collateral Agent.
 
(g)  Certificates of Ownership; Searches; Class Certificates; Appraisal Reports;
Mortgages.  On each Vessel Acquisition Borrowing Date, the Administrative Agent
shall have received each of the following with respect to each Vessel being
acquired on such Borrowing Date:
 
(i)  certificates of ownership from appropriate authorities showing (or
confirmation updating previously reviewed certificates and indicating) the
registered ownership of such Vessel by the relevant Subsidiary Guarantor;
 
(ii)  the results of maritime registry searches with respect to such Vessel,
indicating no record liens other than Liens in favor of the Collateral Agent
and/or the Lenders, Permitted Liens and Liens being discharged contemporaneously
with such acquisition;
 
(iii)  class certificates from a classification society listed on Schedule IX
hereto or another internationally recognized classification society acceptable
to the Collateral Agent, indicating that such Vessel meets the criteria
specified in Section 9.24;
 
(iv)  Appraisals from at least two Approved Appraisers of such Vessel of recent
date in scope, form and substance reasonably satisfactory to the Administrative
Agent; and
 
(v)  a report, in form and scope reasonably satisfactory to the Administrative
Agent, from a firm of independent marine insurance brokers reasonably acceptable
to the Administrative Agent with respect to the insurance maintained by the
Credit Parties in respect of such Vessel, together with a certificate from such
broker certifying that such
 
 
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insurances (i) are placed with such insurance companies and/or underwriters
and/or clubs, in such amounts, against such risks, and in such form, as are
customarily insured against by similarly situated insureds for the protection of
the Administrative Agent and/or the Lenders as mortgagee and (ii) conform with
the insurance requirements of the respective Vessel Mortgage.
 
(h)  Management and Service Agreements.  On each Vessel Acquisition Borrowing
Date, there shall have been delivered to the Administrative Agent or its counsel
true and correct copies of the following documents:
 
(i)  all Management Agreements with respect to the Subsidiary Guarantor of each
Additional Vessel not delivered on or prior to the Collateral Delivery Date; and
 
(ii)  all Service Agreements entered into between the Borrower and its
Subsidiaries not delivered on or prior to the Collateral Delivery Date;
 
all of which Management Agreements and Service Agreements shall be in form and
substance reasonably satisfactory to the Mandated Lead Arranger and shall be in
full force and effect on the Collateral Delivery Date.
 
(i)  Environmental Laws.  On each Vessel Acquisition Borrowing Date, there shall
not exist any condition or occurrence on or arising from any Additional Vessel
or property owned or operated or occupied by the Borrower or any of its
Subsidiaries that (a) results in noncompliance by the Borrower or such
Subsidiary with any applicable Environmental Law that has had, or could
reasonably be expect to have, a Material Adverse Effect or (b) could reasonably
be expected to form the basis of a Environmental Claim against the Borrower or
any of its Subsidiaries or any property (including, without limitation, the
related Additional Vessel), which in any such case individually or in the
aggregate could reasonably be expected to have a Material Adverse Effect.
 
8.03  Conditions Precedent to the initial Loan for Pre-Delivery Installments of
Additional Newbuilding Vessels (other than Capesize Vessels).  The obligation of
each Lender to make Loans to the Borrower the proceeds of which shall be
utilized to fund Pre-Delivery Installments in respect of Newbuilding Vessels
(other than Capesize Vessels) is subject at the time of making such Loans to the
satisfaction or waiver of the following conditions:
 
(a)  Opinions of Counsel.  (i)  On the Borrowing Date of the initial Loan for
the initial Pre-Delivery Installment in respect of an Additional Newbuilding
Vessel, the Administrative Agent shall have received from Kramer Levin Naftalis
& Frankel LLP, special New York counsel to the Borrower and its Subsidiaries, an
opinion addressed to the Administrative Agent and each of the Lenders and dated
such Borrowing Date which shall be in form and substance reasonably acceptable
to the Mandated Lead Arranger and cover the perfection of the security interests
granted pursuant to the Assignment of Construction Contract and such other
matters incidental to the transactions contemplated herein as the Mandated Lead
Arranger may reasonably request; and
 
(ii)  On the Borrowing Date for the initial Pre-Delivery Installment in respect
of an Additional Newbuilding Vessel, the Administrative Agent shall have
received from
 
 
 
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Reeder & Simpson P.C., special Marshall Islands counsel to the Borrower and its
Subsidiaries (or such other counsel reasonably satisfactory to the
Administrative Agent), an opinion addressed to the Administrative Agent and each
of the Lenders and dated such Borrowing Date which shall be in form and
substance reasonably acceptable to the Mandated Lead Arranger; and
 
(b)  Corporate Documents; Proceedings; etc.  (i)  On the Borrowing Date for the
initial Pre-Delivery Installment in respect of an Additional Newbuilding Vessel,
the Mandated Lead Arranger shall have received a certificate, dated such
Borrowing Date, signed by an Authorized Officer, member or general partner of
the Credit Party consummating the Vessel Acquisition on such date, and attested
to by the secretary or any assistant secretary (or, to the extent such Credit
Party does not have a secretary or assistant secretary, the analogous Person
within such Credit Party) of such Credit Party, as the case may be, in
substantially the form of Exhibit D, with appropriate insertions, together with
copies of the Certificate of Incorporation and By-Laws (or equivalent
organizational documents) of such Credit Party and the resolutions of such
Credit Party referred to in such certificate, and the foregoing shall be
reasonably acceptable to the Mandated Lead Arranger.
 
(ii)  All corporate, limited liability company, partnership and legal
proceedings, and all material instruments and agreements in connection with the
transactions contemplated by this Agreement, shall be reasonably satisfactory in
form and substance to the Mandated Lead Arranger, and the Mandated Lead Arranger
shall have received all information and copies of all documents and papers,
including records of corporate, limited liability company and partnership
proceedings, governmental approvals and good standing certificates, if any,
which the Mandated Lead Arranger may have reasonably requested in connection
therewith, such documents and papers, where appropriate, to be certified by
proper corporate or governmental authorities.
 
(c)  Subsidiaries Guaranty.  On the Borrowing Date for the initial Pre-Delivery
Installment in respect of an Additional Newbuilding Vessel, each Subsidiary of
the Borrower which is entering into a Construction Contract on such date shall
have duly authorized, executed and delivered to the Administrative Agent the
Guaranty, and the Guaranty shall be in full force and effect.
 
(d)  Pledge and Security Agreement.  On the Borrowing Date for the initial
Pre-Delivery Installment in respect of an Additional Newbuilding Vessel, each
Credit Party which is entering into a Construction Contract on such date shall
have (x) duly authorized, executed and delivered the Pledge Agreement and shall
have (A) delivered to the Collateral Agent, as pledgee, all the Pledged
Securities referred to therein, together with executed and undated stock powers
in the case of capital stock constituting Pledged Securities, and (B) otherwise
complied with all of the requirements set forth in the Pledge Agreement and
(y) duly authorized, executed and delivered any other related documentation
necessary or advisable to perfect the Lien on the Pledge Agreement Collateral
referred to therein in the respective jurisdictions of formation of the
respective Subsidiary Guarantor.
 
(e)  Assignments of Construction Contract.  (i) On the Borrowing Date for the
initial Pre-Delivery Installment in respect of an Additional Newbuilding Vessel,
each Credit
 
 
 
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Party entering into a construction contract on such date shall have executed and
delivered to the Administrative Agent an assignment of the relevant shipbuilding
contract (the “Assignment of Construction Contract”), to be duly accepted by the
named builder (the “Builder”) therein, in form and substance satisfactory to the
Administrative Agent.
 
(ii)  On the Borrowing Date for the initial Pre-Delivery Installment in respect
of an Additional Newbuilding Vessel, each Credit Party which is party to such a
construction contract shall have executed and delivered to the Administrative
Agent an assignment of the Builder’s refund guarantees, which guarantees must be
SAFE registered Chinese refund guarantees if the Builder is a shipyard located
within the People’s Republic of China, in form and substance satisfactory to the
Administrative Agent, duly acknowledged by the Builder, from a financial
institution acceptable to the Administrative Agent.
 
8.04  Conditions Precedent to all Loans in Respect of Deposits Under Purchase
Agreements for Additional Vessels Other than Capesize Vessels.  The obligation
of each Lender to make Vessel Acquisition Loans to the Borrower the proceeds of
which shall be utilized to fund deposits in connection with the acquisition of
Additional Vessels (other than Capesize Vessels) is subject at the time of
making such Vessel Acquisition Loans to the satisfaction or waiver of the
following conditions:
 
(a)  Opinions of Counsel.  (i)  On the Borrowing Date of a Loan in respect of
deposits under Purchase Agreements for any Additional Vessel (other than a
Capesize Vessel), the Administrative Agent shall have received from Kramer Levin
Naftalis & Frankel LLP, special New York counsel to the Borrower and its
Subsidiaries, an opinion addressed to the Administrative Agent and each of the
Lenders and dated such Borrowing Date which shall be in form and substance
reasonably acceptable to the Mandated Lead Arranger and cover the perfection of
the security interests granted pursuant to the Assignment of Purchase Contract
and such other matters incidental to the transactions contemplated herein as the
Mandated Lead Arranger may reasonably request; and
 
(ii)  On the Vessel Acquisition Borrowing Date of a Loan in respect of deposits
under Purchase Agreements for any Additional Vessel other than a Capesize
Vessel, the Administrative Agent shall have received from Reeder & Simpson P.C.,
special Marshall Islands counsel to the Borrower and its Subsidiaries (or such
other counsel reasonably satisfactory to the Administrative Agent), an opinion
addressed to the Administrative Agent and each of the Lenders and dated such
Borrowing Date which shall be in form and substance reasonably acceptable to the
Mandated Lead Arranger; and
 
(b)  Corporate Documents; Proceedings; etc.  (i)  On the Borrowing Date of a
Loan in respect of deposits under Purchase Agreements for any Additional Vessel
(other than a Capesize Vessel), the Mandated Lead Arranger shall have received a
certificate, dated such Borrowing Date, signed by an Authorized Officer, member
or general partner of the Credit Party consummating the Vessel Acquisition on
such date, and attested to by the secretary or any assistant secretary (or, to
the extent such Credit Party does not have a secretary or assistant secretary,
the analogous Person within such Credit Party) of such Credit Party, as the case
may be, in substantially the form of Exhibit D, with appropriate insertions,
together with copies of the Certificate of Incorporation and By-Laws (or
equivalent organizational documents) of such
 
 
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Credit Party and the resolutions of such Credit Party referred to in such
certificate, and the foregoing shall be reasonably acceptable to the Mandated
Lead Arranger.
 
(ii)  All corporate, limited liability company, partnership and legal
proceedings, and all material instruments and agreements in connection with the
transactions contemplated by this Agreement, shall be reasonably satisfactory in
form and substance to the Mandated Lead Arranger, and the Mandated Lead Arranger
shall have received all information and copies of all documents and papers,
including records of corporate, limited liability company and partnership
proceedings, governmental approvals and good standing certificates, if any,
which the Mandated Lead Arranger may have reasonably requested in connection
therewith, such documents and papers, where appropriate, to be certified by
proper corporate or governmental authorities.
 
(c)  Subsidiaries Guaranty.  On the Borrowing Date of a Loan in respect of
deposits under Purchase Agreements for any Additional Vessel (other than a
Capesize Vessel), each Subsidiary of the Borrower which is entering into a
Purchase Contract on such date shall have duly authorized, executed and
delivered to the Administrative Agent the Guaranty, and the Guaranty shall be in
full force and effect.
 
(d)  Pledge and Security Agreement.  On the Borrowing Date of a Loan in respect
of deposits under Purchase Agreements for any Additional Vessel (other than a
Capesize Vessel), each Credit Party which is entering into a Purchase Contract
on such date shall have (x) duly authorized, executed and delivered the Pledge
Agreement and shall have (A) delivered to the Collateral Agent, as pledgee, all
the Pledged Securities referred to therein, together with executed and undated
stock powers in the case of capital stock constituting Pledged Securities, and
(B) otherwise complied with all of the requirements set forth in the Pledge
Agreement and (y) duly authorized, executed and delivered any other related
documentation necessary or advisable to perfect the Lien on the Pledge Agreement
Collateral referred to therein in the respective jurisdictions of formation of
the respective Subsidiary Guarantor.
 
(e)  Assignments of Purchase Contract.  On the Borrowing Date of a Loan in
respect of deposits under Purchase Agreements for any Additional Vessel (other
than a Capesize Vessel), each Credit Party which is consummating a Vessel
Acquisition on such date shall have executed and delivered to the Administrative
Agent the relevant Assignment of Purchase Contract, to be duly accepted by the
named the Seller named in the Purchase Contract, in form and substance
satisfactory to the Administrative Agent.
 
The acceptance of the proceeds of each Loan and/or the issuance of Letters of
Credits shall constitute a representation and warranty by the Borrower to the
Administrative Agent and each of the Lenders that all of the applicable
conditions specified in Section 5 and in this Section 6 and applicable to such
Borrowing or the issuance of such Letter of Credit have been satisfied as of
that time.  All of the applicable Notes, certificates, legal opinions and other
documents and papers referred to in Section 7 and in this Section 8, unless
otherwise specified, shall be delivered to the Administrative Agent at the
Notice Office for the account of each of the Lenders and, except for the Notes,
in sufficient counterparts for each of the Lenders and shall be in form and
substance reasonably satisfactory to the Administrative Agent.
 
 
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SECTION 9.  Representations, Warranties and Agreements.  In order to induce the
Lenders to enter into this Agreement and to make the Loans and issue (or
participate in) the Letters of Credit, the Borrower makes the following
representations, warranties and agreements, in each case on the Effective Date
and on each Borrowing Date thereafter, all of which shall survive the execution
and delivery of this Agreement and the Notes and the making of the Loans or
issuance of Letters of Credit, with the incurrence of each Loan or issuance of
Letters of Credit on or after the Effective Date being deemed to constitute a
representation and warranty that the matters specified in this Section 9 are
true and correct in all material respects on and as of the  Effective Date and
on each Borrowing Date thereafter (it being understood and agreed that any
representation or warranty which by its terms is made as of a specified date
shall be required to be true and correct in all material respects only as of
such specified date):
 
9.01  Corporate/Limited Liability Company/Limited Partnership Status.  Each of
the Borrower and each of its Subsidiaries (i) is a duly organized and validly
existing corporation, limited liability company or limited partnership, as the
case may be, in good standing under the laws of the jurisdiction of its
incorporation or formation, (ii) has the corporate or other applicable power and
authority to own its property and assets and to transact the business in which
it is currently engaged and presently proposes to engage and (iii) is duly
qualified and is authorized to do business and is in good standing in each
jurisdiction where the conduct of its business as currently conducted requires
such qualifications, except for failures to be so qualified which, either
individually or in the aggregate, could not reasonably be expected to have a
Material Adverse Effect.
 
9.02  Corporate Power and Authority.  Each Credit Party has the corporate or
other applicable power and authority to execute, deliver and perform the terms
and provisions of each of the Documents to which it is party and has taken all
necessary corporate or other applicable action to authorize the execution,
delivery and performance by it of each of such Documents other than in respect
of the Subsidiary Guarantors who are owners of Existing Vessels and cannot enter
into the documents to which they are to be a party prior to the Borrowing Date
in respect of the Refinancing Loan.  Each Credit Party has duly executed and
delivered each of the Documents to which it is party, and each of such Documents
constitutes the legal, valid and binding obligation of such Credit Party
enforceable against such Credit Party in accordance with its terms, except to
the extent that the enforceability thereof may be limited by applicable
bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium or
other similar laws generally affecting creditors’ rights and by equitable
principles (regardless of whether enforcement is sought in equity or at law).
 
9.03  No Violation.  Neither the execution, delivery or performance by any
Credit Party of the Documents to which it is a party, nor compliance by it with
the terms and provisions thereof, will (i) contravene any material provision of
any applicable law, statute, rule or regulation or any applicable order, writ,
injunction or decree of any court or governmental instrumentality, (ii) conflict
with or result in any breach of any of the terms, covenants, conditions or
provisions of, or constitute a default under, or result in the creation or
imposition of (or the obligation to create or impose) any Lien (except pursuant
to the Security Documents) upon any of the material properties or assets of the
Borrower or any of its Subsidiaries pursuant to the terms of any indenture,
mortgage, deed of trust, credit agreement or loan agreement, or any other
material agreement, contract or instrument, to which the Borrower or any of its
 
 
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Subsidiaries is a party or by which it or any of its material property or assets
is bound or to which it may be subject or (iii) violate any provision of the
Certificate of Incorporation or By-Laws (or equivalent organizational documents)
of the Borrower or any of its Subsidiaries.  
 
9.04  Governmental Approvals.  No order, consent, approval, license,
authorization or validation of, or filing, recording or registration with
(except as have been obtained or made or in the case of any filings or
recordings in respect of the Security Documents (other than the Vessel
Mortgages), will be made within 10 days of the date such Security Document is
required to be executed pursuant hereto), or exemption by, any governmental or
public body or authority, or any subdivision thereof, is required to authorize,
or is required in connection with, (i) the execution, delivery and performance
by any Credit Party of any Document to which it is a party or (ii) the legality,
validity, binding effect or enforceability of  any Document to which it is or
will be a party.
 
9.05  Financial Statements; Financial Condition; Undisclosed
Liabilities.  (a)  The audited consolidated balance sheets of the Borrower as at
December 31, 2006 and the unaudited consolidated balance sheets of the Borrower
as at March 31, 2007 and the related consolidated statements of operations and
of cash flows for the fiscal period or quarter, as the case may be, ended on
such dates, reported on by and accompanied by, in the case of the December 31,
2006 financial statements, an unqualified report from Deloitte & Touche LLP,
present fairly the consolidated financial condition of the Borrower as at such
dates, and the consolidated results of its operations and its consolidated cash
flows for the respective fiscal period or quarter, as the case may be, then
ended.  All such financial statements, including the related schedules and notes
thereto, have been prepared in accordance with GAAP applied consistently
throughout the periods involved (except as approved by the aforementioned firm
of accountants and disclosed therein).
 
(b)  On and as of each Borrowing Date and after giving effect to all
Indebtedness (including the Loans) being incurred or assumed and Liens created
by the Credit Parties in connection therewith (i) the sum of the assets, at a
fair valuation, of the Borrower and on a stand-alone basis and of the Borrower
and its Subsidiaries taken as a whole will exceed their respective debts,
(ii) each of the Borrower on a stand-alone basis and the Borrower and its
Subsidiaries taken as a whole have not incurred and do not intend to incur, and
do not believe that they will incur, debts beyond their respective ability to
pay such debts as such debts mature, and (iii) the Borrower on a stand-alone
basis and the Borrower and its Subsidiaries taken as a whole will have
sufficient capital with which to conduct their respective businesses.  For
purposes of this Section 9.05(b), “debt” means any liability on a claim, and
“claim” means (a) right to payment, whether or not such a right is reduced to
judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured,
disputed, undisputed, legal, equitable, secured, or unsecured or (b) right to an
equitable remedy for breach of performance if such breach gives rise to a
payment, whether or not such right to an equitable remedy is reduced to
judgment, fixed, contingent, matured, unmatured, disputed, undisputed, secured
or unsecured.  The amount of contingent liabilities at any time shall be
computed as the amount that, in the light of all the facts and circumstances
existing at such time, represents the amount that can reasonably be expected to
become an actual or matured liability.
 
 
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(c)  Except as fully disclosed in the balance sheet delivered pursuant to
Section 9.05(a), there were as of the  Effective Date no liabilities or
obligations with respect to the Borrower or any of its Subsidiaries of any
nature whatsoever (whether absolute, accrued, contingent or otherwise and
whether or not due) which, either individually or in the aggregate, would be
materially adverse to the Borrower and its Subsidiaries taken as a whole.  None
of the Credit Parties knows of any basis for the assertion against it of any
liability or obligation of any nature that is not fairly disclosed (including,
without limitation, as to the amount thereof) in the balance sheets delivered
pursuant to Section 9.05(a) which, either individually or in the aggregate,
could be materially adverse to the Borrower and its Subsidiaries taken as a
whole.
 
(d)  Since March 31, 2007, nothing has occurred that, either individually or in
the aggregate, has had or could reasonably be expected to have a Material
Adverse Effect.
 
(e)  Since the Effective Date, except as permitted in Section 11.03, the
Borrower has not paid any Dividends.
 
9.06  Litigation.  There are no actions, suits, investigations or proceedings by
any entity (private or governmental) pending or, to the knowledge of any Credit
Party, threatened with respect to (i) any Mortgaged Vessel, except for such
actions, suits, investigations or proceedings with respect to a Mortgaged Vessel
which could not, either individually or in the aggregate, reasonably be expected
to have a Material Adverse Effect, or (iii) which could reasonably be expected
to have a Material Adverse Effect.
 
9.07  True and Complete Disclosure.  All factual information (taken as a whole)
furnished by or on behalf of the Borrower or any of its Subsidiaries to the
Administrative Agent or any Lender (including, without limitation, all
information contained in the Documents) for purposes of or in connection with
this Agreement, the other Credit Documents or any transaction contemplated
herein or therein is, and all other such factual information (taken as a whole)
hereafter furnished by or on behalf of the Borrower or any of its Subsidiaries
in writing to the Administrative Agent or any Lender will be, true and accurate
in all material respects and not incomplete by omitting to state any fact
necessary to make such information (taken as a whole) not misleading in any
material respect at such time as such information was provided.
 
9.08  Use of Proceeds; Margin Regulations.  (a)  All proceeds of the Loans shall
be used to (i) refinance the Existing Credit Agreement and Revolving Credit
Agreement, (ii) fund up to 100% of the acquisition costs of the Capesize Vessels
of up to One Billion One Hundred Eleven Million United States Dollars
(US$1,111,000,000), including any required Capesize Vessel Deposit, (iii) fund
acquisition costs of any Additional Vessels, including any required Additional
Vessel Deposit or any Pre-Delivery Installation, (iv) fund working capital
requirements of the Borrower and its Subsidiaries in a maximum aggregate amount
of up to $50,000,000 in Loans at any time, and (v) the issuance of up to
US$50,000,000 in standby letters of credit.
 
(b)  No part of the proceeds of any Loan or any Letter of Credit will be used to
purchase or carry any Margin Stock or to extend credit for the purpose of
purchasing or carrying any Margin Stock.  Neither the making of any Loan nor the
use of the proceeds thereof nor the
 
 
 
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use of any Letter of Credit will violate or be inconsistent with the provisions
of Regulations T, U or X of the Board of Governors of the Federal Reserve
System.
 
9.09  Tax Returns and Payments.  Each of the Borrower and each of its
Subsidiaries has timely filed all U.S. federal income tax returns, statements,
forms and reports for taxes and all other material U.S. and non-U.S. tax
returns, statements, forms and reports for taxes required to be filed by or with
respect to the income, properties or operations of the Borrower and/or any of
its Subsidiaries (the “Returns”).  The Returns accurately reflect in all
material respects all liability for taxes of the Borrower and its Subsidiaries
for the periods covered thereby.  The Borrower and each of its Subsidiaries have
at all times paid, or have provided adequate reserves (in accordance with GAAP)
for the payment of, all material taxes payable by them.  There is no material
action, suit, proceeding, investigation, audit, or claim now pending or, to the
best knowledge of the Borrower or any of its Subsidiaries, threatened by any
authority regarding any taxes relating to the Borrower or any of its
Subsidiaries.  Neither the Borrower nor any of its Subsidiaries has entered into
an agreement or waiver or been requested to enter into an agreement or waiver
extending any statute of limitations relating to the payment or collection of
taxes of the Borrower or any of its Subsidiaries, or is aware of any
circumstances that would cause the taxable years or other taxable periods of the
Borrower or any of its Subsidiaries not to be subject to the normally applicable
statute of limitations.  
 
9.10  Compliance with ERISA.  (i) Schedule VII sets forth, as of the Effective
Date, each Plan.  Each Plan, other than any Multiemployer Plan (and each related
trust, insurance contract or fund), is in substantial compliance with its terms
and with all applicable laws, including without limitation ERISA and the Code;
each Plan, other than any Multiemployer Plan (and each related trust, if any),
which is intended to be qualified under Section 401(a) of the Code has received
a determination letter from the Internal Revenue Service to the effect that it
meets the requirements of Sections 401(a) and 501(a) of the Code; no Reportable
Event has occurred; to the best knowledge of the Borrower or any of its
Subsidiaries or ERISA Affiliates, no Plan which is a Multiemployer Plan is
insolvent or in reorganization; no Plan has an Unfunded Current Liability in an
amount material to the Borrower’s operation; no Plan (other than a Multiemployer
Plan) which is subject to Section 412 of the Code or Section 302 of ERISA has an
accumulated funding deficiency within the meaning of such sections of the Code
or ERISA, or has applied for or received a waiver of an accumulated funding
deficiency or an extension of any amortization period within the meaning of
Section 412 of the Code or Section 303 or 304 of ERISA; all contributions
required to be made with respect to a Plan have been or will be timely made
(except as disclosed on Schedule VII); neither the Borrower nor any of its
Subsidiaries nor any ERISA Affiliate has incurred any material liability
(including any indirect, contingent or secondary liability) to or on account of
a Plan pursuant to Section 409, 502(i), 502(l), 515, 4062, 4063, 4064, 4069,
4201, 4204 or 4212 of ERISA or Section 401(a)(29), 4971 or 4975 of the Code or
expects to incur any such liability under any of the foregoing sections with
respect to any Plan; no condition exists which presents a material risk to the
Borrower or any of its Subsidiaries or any ERISA Affiliate of incurring a
liability to or on account of a Plan pursuant to the foregoing provisions of
ERISA and the Code; no proceedings have been instituted by the PBGC to terminate
or appoint a trustee to administer any Plan (in the case of a Multiemployer
Plan, to the best knowledge of the Borrower or any of its Subsidiaries or ERISA
Affiliates) which is subject to Title IV of ERISA; no action, suit, proceeding,
hearing, audit or investigation with respect to the administration, operation or
the investment of assets of any Plan
 
 
 
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(other than routine claims for benefits) is pending, or, to the best knowledge
of the Borrower or any of its Subsidiaries, expected or threatened which could
reasonably be expected to have a Material Adverse Effect; using actuarial
assumptions and computation methods consistent with Part 1 of subtitle E of
Title IV of ERISA, the Borrower and its Subsidiaries and ERISA Affiliates would
have no liabilities to any Plans which are Multiemployer Plans in the event of a
complete withdrawal therefrom in an amount which could reasonably be expected to
have a Material Adverse Effect; each group health plan (as defined in Section
607(1) of ERISA or Section 4980B(g)(2) of the Code) which covers or has covered
employees or former employees of the Borrower, any of its Subsidiaries, or any
ERISA Affiliate has at all times been operated in material compliance with the
provisions of Part 6 of subtitle B of Title I of ERISA and Section 4980B of the
Code; no lien imposed under the Code or ERISA on the assets of the Borrower or
any of its Subsidiaries or any ERISA Affiliate exists nor has any event occurred
which could reasonably be expected to give rise to any such lien on account of
any Plan; and the Borrower and its Subsidiaries do not maintain or contribute to
any employee welfare plan (as defined in Section 3(1) of ERISA) which provides
benefits to retired employees or other former employees (other than as required
by Section 601 of ERISA) or any Plan the obligations with respect to which could
reasonably be expected to have a Material Adverse Effect.
 
(ii)  Each Foreign Pension Plan, if any, has been maintained in substantial
compliance with its terms and with the requirements of any and all applicable
laws, statutes, rules, regulations and orders and has been maintained, where
required, in good standing with applicable regulatory authorities.  All
contributions required to be made with respect to a Foreign Pension Plan have
been or will be timely made.  Neither the Borrower nor any of its Subsidiaries
has incurred any obligation in connection with the termination of or withdrawal
from any Foreign Pension Plan that could reasonably be expected to have a
Material Adverse Effect.  Neither the Borrower nor any of its Subsidiaries
maintains or contributes to any Foreign Pension Plan the obligations with
respect to which could in the aggregate reasonably be expected to have a
Material Adverse Effect.
 
9.11  The Security Documents.  After the execution and delivery thereof and upon
the taking of the actions mentioned in the immediately succeeding sentence, each
of the Security Documents will create in favor of the Collateral Agent for the
benefit of the Secured Creditors a legal, valid and enforceable fully perfected
first priority security interest in and Lien on all right, title and interest of
the Credit Parties party thereto in the Collateral described therein, subject to
no other Liens subject only to Permitted Liens.  No filings or recordings are
required in order to perfect the security interests created under any Security
Document except for filings or recordings which shall be (x) on or prior to the
Collateral Delivery Date, in the case of the respective Vessel Mortgages,
Assignment of Earnings, Assignment of Insurances and Assignment of Charters in
respect of the initial Mortgaged Vessels, or (y) on or prior to the respective
Vessel Acquisition Borrowing Date, in case of the respective Vessel Mortgages,
Assignment of Earnings, Assignment of Insurance and Assignment of Charters in
respect of the Additional Vessels acquired on such Vessel Acquisition Borrowing
Date or (z) on or prior to the tenth day after the respective Borrowing Date (as
applicable) in the case of all other Collateral.
 
9.12  Representations and Warranties in Documents.  On each Borrowing Date, all
representations and warranties made by the Borrower and its Subsidiaries in the
other Credit
 
 
 
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Documents were true and correct in all material respects at the time as of which
such representations and warranties were made (or deemed made).
 
9.13  Subsidiaries.  On the Effective Date, the Borrower has no Subsidiaries
other than those Subsidiaries listed on Schedule VIII (which Schedule identifies
the correct legal name, direct owner, percentage ownership and jurisdiction of
organization of each such Subsidiary on the date hereof).
 
9.14  Compliance with Statutes, etc.  Each of the Borrower and each of its
Subsidiaries is in compliance in all material respects with all applicable
statutes, regulations and orders of, and all applicable restrictions imposed by,
all governmental bodies, domestic or foreign, in respect of the conduct of its
business and the ownership of its property, except such noncompliances as could
not, either individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect.
 
9.15  Investment Company Act.  Neither the Borrower nor any of its Subsidiaries
is an “investment company” or a company “controlled” by an “investment company,”
within the meaning of the Investment Company Act of 1940, as amended.
 
9.16  Pollution and Other Regulations.  Each of the Borrower and each of its
Subsidiaries is in compliance with all applicable Environmental Laws governing
its business, except for such failures to comply as are not reasonably likely to
have a Material Adverse Effect, and neither the Borrower nor any of its
Subsidiaries is liable for any material penalties, fines or forfeitures for
failure to comply with any of the foregoing.  All licenses, permits,
registrations or approvals required for the business of the Borrower and each of
its Subsidiaries, as conducted as of the Effective Date, under any Environmental
Law have been secured and each of the Borrower and each of its Subsidiaries is
in substantial compliance therewith, except for such failures to secure or
comply as are not reasonably likely to have a Material Adverse Effect.  Neither
the Borrower nor any of its Subsidiaries is in any respect in noncompliance
with, breach of or default under any applicable writ, order, judgment,
injunction, or decree to which the Borrower or such Subsidiary is a party or
which would affect the ability of the Borrower or such Subsidiary to operate any
Mortgaged Vessel, Real Property or other facility and no event has occurred and
is continuing which, with the passage of time or the giving of notice or both,
would constitute noncompliance, breach of or default thereunder, except in each
such case, such noncompliances, breaches or defaults as are not likely to,
either individually or in the aggregate, have a Material Adverse Effect.  There
are no Environmental Claims pending or, to the knowledge of the Borrower,
threatened against the Borrower or any of its Subsidiaries which, either
individually or in the aggregate, are reasonably likely to have a Material
Adverse Effect.  There are no facts, circumstances, conditions or occurrences on
any Mortgaged Vessel, Real Property or other facility owned or operated by the
Borrower or any of its Subsidiaries that is reasonably likely (i) to form the
basis of an Environmental Claim against the Borrower, any of its Subsidiaries or
any Mortgaged Vessel, Real Property or other facility owned by the Borrower or
any of its Subsidiaries, or (ii) to cause such Mortgaged Vessel, Real Property
or other facility to be subject to any restrictions on its ownership, occupancy,
use or transferability under any Environmental Law, except in each such case,
such Environmental Claims or restrictions that, either individually or in the
aggregate, are not reasonably likely to have a Material Adverse Effect.
 
 
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9.17  Labor Relations.  Neither the Borrower nor any of its Subsidiaries is
engaged in any unfair labor practice that could reasonably be expected to have a
Material Adverse Effect and there is (i) no unfair labor practice complaint
pending against the Borrower or any of its Subsidiaries or, to the Borrower’
knowledge, threatened against any of them before the National Labor Relations
Board, and no material grievance or arbitration proceeding arising out of or
under any collective bargaining agreement is so pending against the Borrower or
any of its Subsidiaries or, to the Borrower’ knowledge, threatened against any
of them, (ii) no strike, labor dispute, slowdown or stoppage pending against the
Borrower or any of its Subsidiaries or, to the Borrower’ knowledge, threatened
against the Borrower or any of its Subsidiaries and (iii) no union
representation proceeding pending with respect to the employees of the Borrower
or any of its Subsidiaries, except (with respect to the matters specified in
clauses (i), (ii) and (iii) above) as could not, either individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect.
 
9.18  Patents, Licenses, Franchises and Formulas.  Each of the Borrower and each
of its Subsidiaries owns, or has the right to use, all material patents,
trademarks, permits, service marks, trade names, copyrights, licenses,
franchises and formulas, and has obtained assignments of all leases and other
rights of whatever nature, necessary for the present conduct of its business,
without any known conflict with the rights of others, except for such failures
and conflicts which could not, either individually or in the aggregate,
reasonably be expected to result in a Material Adverse Effect.
 
9.19  Indebtedness.  Schedule V sets forth a true and complete list of all
Indebtedness, other than that incurred pursuant to the Existing Credit Facility
and the Revolving Credit Facility, of the Borrower and its Subsidiaries as of
the Effective Date and which is to remain outstanding after giving effect to the
Effective Date (the “Existing Indebtedness”), in each case showing the aggregate
principal amount thereof and the name of the borrower and any other entity which
directly or indirectly guarantees such debt.
 
9.20  Insurance.  Schedule VI sets forth a true and complete listing of all
insurance maintained by each Credit Party as of the Effective Date, with the
amounts insured (and any deductibles) set forth therein.
 
9.21  Concerning the Vessels.  The name, registered owner (which shall be a
Subsidiary Guarantor), official number, and jurisdiction of registration and
flag of each Existing Vessel as of the Effective Date are set forth on Schedule
III.  Each vessel owned or to be owned by a Subsidiary Guarantor or the Borrower
will be operated in material compliance with all applicable law, rules and
regulations.
 
9.22  Citizenship.  The Borrower and each other Credit Party which owns or
operates, or will own or operate, one or more Mortgaged Vessels is qualified to
own and operate such Mortgaged Vessels under the laws of Hong Kong or the
Republic of the Marshall Islands, as may be applicable, or such other
jurisdiction in which any such Mortgaged Vessels are permitted to be flagged in
accordance with the terms of the respective Vessel Mortgages.
 
9.23  Vessel Classification.  On each Borrowing Date of a Vessel Acquisition
Loan, and thereafter, each Mortgaged Vessel is or will be, classified in the
highest class available
 
 
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for Vessels of its age and type with a classification society listed on Schedule
IX or another internationally recognized classification society acceptable to
the Administrative Agent, free of any conditions or recommendations, other than
as permitted, or will be permitted, under the Vessel Mortgages.
 
9.24  No Immunity.  The Borrower does not, nor does any other Credit Party or
any of their respective properties, have any right of immunity on the grounds of
sovereignty or otherwise from the jurisdiction of any court or from setoff or
any legal process (whether through service or notice, attachment prior to
judgment, attachment in aid of execution, execution or otherwise) under the laws
of any jurisdiction.  The execution and delivery of the Credit Documents by the
Credit Parties and the performance by them of their respective obligations
thereunder constitute commercial transactions.
 
9.25  Fees and Enforcement.  No fees or taxes, including, without limitation,
stamp, transaction, registration or similar taxes, are required to be paid to
ensure the legality, validity, or enforceability of this Agreement or any of the
other Credit Documents other than recording taxes which have been, or will be,
paid as and to the extent due.  Under the laws of Hong Kong or the Republic of
the Marshall Islands, as applicable, the choice of the laws of the State of New
York as set forth in the Credit Documents which are stated to be governed by the
laws of the State of New York is a valid choice of law, and the irrevocable
submission by each Credit Party to jurisdiction and consent to service of
process and, where necessary, appointment by such Credit Party of an agent for
service of process, in each case as set forth in such Credit Documents, is
legal, valid, binding and effective.
 
9.26  Form of Documentation.  Each of the Credit Documents is in proper legal
form under the laws of the applicable Acceptable Flag Jurisdiction for the
enforcement thereof under such laws, subject only to such matters which may
affect enforceability arising under the law of the State of New York.  To ensure
the legality, validity, enforceability or admissibility in evidence of each such
Credit Document in the applicable Acceptable Flag Jurisdiction, it is not
necessary that any Credit Document or any other document be filed or recorded
with any court or other authority in the applicable Acceptable Flag
Jurisdiction, except as have been made, or will be made, in accordance with
Sections 7 and 8.
 
9.27  Vessel Acquisitions.  At the time of consummation of each Vessel
Acquisition, all necessary material consents and approvals of, and filings and
registrations with, and all other actions in respect of, all governmental
agencies, authorities or instrumentalities required, if any, in order to make or
consummate such Vessel Acquisition will have been obtained, given, filed or
taken and are or will be in full force and effect (or effective judicial relief
with respect thereto has been obtained), (ii) all applicable waiting periods
with respect thereto have or, prior to the time when required, will have,
expired without, in all such cases, any action being taken by any competent
authority which restrains, prevents, or imposes material adverse conditions upon
any Vessel Acquisition, (iii) no judgment, order or injunction prohibiting or
imposing material adverse conditions upon any Vessel Acquisition, or the
incurrence of any Loan or the performance by the Borrower or any other Credit
Party of their respective obligations under the respective Credit Documents
shall exist and (iv) all actions taken by the Borrower and its Subsidiaries
pursuant to or in furtherance of such Vessel Acquisitions have been taken in all
material respects in compliance with all applicable laws.
 
 
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SECTION 10.  Affirmative Covenants.  The Borrower hereby covenants and agrees
that on and after the Effective Date and until the Total Commitment and all
Letters of Credit have terminated and the Loans, Notes and Unpaid Drawings,
together with interest, Commitment Commission and all other Obligations incurred
hereunder and thereunder, are paid in full:
 
10.01  Information Covenants.  The Borrower will furnish to the Administrative
Agent, with sufficient copies for each of the Lenders:
 
(a)  Quarterly Financial Statements.  Within 45 days after the close of the
first three quarterly accounting periods in each fiscal year of the Borrower,
(i) the consolidated balance sheet of the Borrower and its Subsidiaries as at
the end of such quarterly accounting period and the related consolidated
statements of income and cash flows, in each case for such quarterly accounting
period and for the elapsed portion of the fiscal year ended with the last day of
such quarterly accounting period, and in each case, setting forth comparative
figures for the related periods in the prior fiscal year, all of which shall be
certified by the senior financial officer of the Borrower, subject to normal
year-end audit adjustments and (ii) management’s discussion and analysis of the
important operational and financial developments during the fiscal quarter and
year-to-date periods.
 
(b)  Annual Financial Statements.  Within 90 days after the close of each fiscal
year of the Borrower, (i) the consolidated balance sheet of the Borrower and its
Subsidiaries as at the end of such fiscal year and the related consolidated
statements of income and retained earnings and of cash flows for such fiscal
year setting forth comparative figures for the preceding fiscal year and
certified by an independent certified public accountants of recognized national
standing reasonably acceptable to the Administrative Agent, together with a
report of such accounting firm stating that in the course of its regular audit
of the financial statements of the Borrower and its Subsidiaries, which audit
was conducted in accordance with generally accepted auditing standards, such
accounting firm obtained no knowledge of any Default or Event of Default
pursuant to Sections 11.07 through 11.11, inclusive, which has occurred and is
continuing or, if in the opinion of such accounting firm such a Default or Event
of Default has occurred and is continuing, a statement as to the nature thereof
and (ii) management’s discussion and analysis of the important operational and
financial developments during such fiscal year.
 
(c)  Appraisal Reports.  Within 45 days after the close of the second and the
fourth quarterly accounting periods in each fiscal year of the Borrower, and at
any other time within 33 days of the written request of the Administrative
Agent, Appraisals for each Mortgaged Vessel of recent date in form and substance
satisfactory to the Administrative Agent and from at least two Approved
Appraisers.  All such Appraisals shall be conducted by, and made at the expense
of, the Borrower (it being understood that the Administrative Agent may and, at
the request of the Required Lenders, shall, upon notice to the Borrower, obtain
such Appraisals and that the cost of all such Appraisals will be for the account
of the Borrower); provided that unless a Default or an Event of Default has
occurred and is continuing, in no event shall the Borrower be required to pay
for Appraisals obtained pursuant to this Section 10.01(c) on more than two
occasions in any single fiscal year of the Borrower, with the cost of any such
reports in excess thereof to be paid by the Lenders on a prorata basis.
 
 
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(d)  Projections, etc.  As soon as available but not more than 45 days after the
commencement of each fiscal year of the Borrower beginning with its fiscal year
commencing on January 1, 2008, a budget of the Borrower and its Subsidiaries in
reasonable detail for each of the twelve months and four fiscal quarters of such
fiscal year.
 
(e)  Officer’s Compliance Certificates.  (i)  At the time of the delivery of the
financial statements provided for in Sections 10.01(a) and (b), a certificate of
the senior financial officer of the Borrower in the form of Exhibit I to the
effect that, to the best of such officer’s knowledge, no Default or Event of
Default has occurred and is continuing or, if any Default or Event of Default
has occurred and is continuing, specifying the nature and extent thereof (in
reasonable detail), which certificate shall (x) set forth the calculations
required to establish whether the Borrower was in compliance with the provisions
of Sections 11.07 through 11.11, inclusive, at the end of such fiscal quarter or
year, as the case may be, and (y) certify that there have been no changes to any
of Schedule VIII and Annexes A through F of the Pledge Agreement since the
Effective Date or, if later, since the date of the most recent certificate
delivered pursuant to this Section 10.01(e)(i), or if there have been any such
changes, a list in reasonable detail of such changes (but, in each case with
respect to this clause (y), only to the extent that such changes are required to
be reported to the Collateral Agent pursuant to the terms of such Security
Documents) and whether the Borrower and the other Credit Parties have otherwise
taken all actions required to be taken by them pursuant to such Security
Documents in connection with any such changes.
 
(ii)  At the time of a Collateral Disposition or Vessel Exchange in respect of
any Mortgaged Vessel, a certificate of the senior financial officer of the
Borrower which certificate shall (x) certify on behalf of the Borrower the last
Appraisals received pursuant to Section 10.01(c) determining the Aggregate
Appraised Value after giving effect to such disposition or exchange, as the case
may be, and (y) set forth the calculations required to establish whether the
Borrower is in compliance with the provisions of Section 11.09 after giving
effect to such disposition or exchange, as the case may be.
 
(f)  Notice of Default, Litigation or Event of Loss.  Promptly, and in any event
within three Business Days after the Borrower obtains knowledge thereof, notice
of (i) the occurrence of any event which constitutes a Default or an Event of
Default and which notice shall specify the nature thereof, the period of
existence thereof and what action the Borrower proposes to take with respect
thereto, (ii) any litigation or governmental investigation or proceeding pending
or threatened (x) against the Borrower or any of its Subsidiaries which, if
adversely determined, could reasonably be expected to have a Material Adverse
Effect or (y) with respect to any Vessel Acquisition or any Document and
(iii) any Event of Loss in respect of any Mortgaged Vessel.
 
(g)  Other Reports and Filings.  Promptly, copies of all financial information,
proxy materials and other information and reports, if any, which the Borrower or
any of its Subsidiaries shall file with the Securities and Exchange Commission
(or any successor thereto) or deliver to holders of its Indebtedness pursuant to
the terms of the documentation governing such Indebtedness (or any trustee,
agent or other representative therefore).
 
 
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(h)  Environmental Matters.  Promptly upon, and in any event within five
Business Days after, the Borrower obtains knowledge thereof, written notice of
any of the following environmental matters occurring after the Effective Date,
except to the extent that such environmental matters could not, either
individually or in the aggregate, be reasonably expected to have a Material
Adverse Effect:
 
(i)  any Environmental Claim pending or threatened in writing against the
Borrower or any of its Subsidiaries or any Vessel or property owned or operated
or occupied by the Borrower or any of its Subsidiaries;
 
(ii)  any condition or occurrence on or arising from any Vessel or property
owned or operated or occupied by the Borrower or any of its Subsidiaries that
(a) results in noncompliance by the Borrower or such Subsidiary with any
applicable Environmental Law or (b) could reasonably be expected to form the
basis of an Environmental Claim against the Borrower or any of its Subsidiaries
or any such Vessel or property;
 
(iii)  any condition or occurrence on any Vessel or property owned or operated
or occupied by the Borrower or any of its Subsidiaries that could reasonably be
expected to cause such Vessel or property to be subject to any restrictions on
the ownership, occupancy, use or transferability by the Borrower or such
Subsidiary of such Vessel or property under any Environmental Law; and
 
(iv)  the taking of any removal or remedial action in response to the actual or
alleged presence of any Hazardous Material on any Vessel or property owned or
operated or occupied by the Borrower or any of its Subsidiaries as required by
any Environmental Law or any governmental or other administrative agency;
provided that in any event the Borrower shall deliver to the Administrative
Agent all material notices received by the Borrower or any of its Subsidiaries
from any government or governmental agency under, or pursuant to, CERCLA or OPA.
 
All such notices shall describe in reasonable detail the nature of the claim,
investigation, condition, occurrence or removal or remedial action and the
Borrower’s or such Subsidiary’s response thereto.  In addition, the Borrower
will provide the Administrative Agent with copies of all material communications
with any government or governmental agency and all material communications with
any Person relating to any Environmental Claim of which notice is required to be
given pursuant to this Section 10.01(h), and such detailed reports of any such
Environmental Claim as may reasonably be requested by the Administrative Agent
or the Required Lenders.
 
(i)  Minimum Consolidated Net Worth Certificate.  Within 10 days of the
Effective Borrowing Date, a certificate of the senior financial officer of the
Borrower, which certificate shall certify the Minimum Consolidated Net Worth and
the calculations required to establish the Minimum Consolidated Net Worth as set
forth in Sections 11.11 and 13.01 hereto.
 
(j)  Other Information.  From time to time, such other information or documents
(financial or otherwise) with respect to the Borrower or its Subsidiaries as the
Administrative Agent or the Required Lenders may reasonably request in writing.
 
 
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10.02  Books, Records and Inspections.  The Borrower will, and will cause each
of its Subsidiaries to, keep proper books of record and account in which full,
true and correct entries, in conformity in all material respects with generally
accepted accounting principles and all requirements of law, shall be made of all
dealings and transactions in relation to its business.  The Borrower will, and
will cause each of its Subsidiaries to, permit officers and designated
representatives of the Administrative Agent and the Lenders as a group to visit
and inspect, during regular business hours and under guidance of officers of the
Borrower or any of its Subsidiaries, any of the properties of the Borrower or
its Subsidiaries, and to examine the books of account of the Borrower or such
Subsidiaries and discuss the affairs, finances and accounts of the Borrower or
such Subsidiaries with, and be advised as to the same by, its and their officers
and independent accountants, all upon reasonable advance notice and at such
reasonable times and intervals and to such reasonable extent as the
Administrative Agent or the Required Lenders may request; provided that, unless
an Event of Default exists and is continuing at such time, the Administrative
Agent and the Lenders shall not be entitled to request more than two such
visitations and/or examinations in any fiscal year of the Borrower.
 
10.03  Maintenance of Property; Insurance; Mortgagee Interest
Insurance.  (a)  The Borrower will, and will cause each of its Subsidiaries to,
(i) keep all material property necessary in its business in good working order
and condition (ordinary wear and tear and loss or damage by casualty or
condemnation excepted), (ii) maintain insurance on the Mortgaged Vessels in at
least such amounts and against at least such risks as are in accordance with
normal industry practice for similarly situated insureds and (iii) furnish to
the Administrative Agent, at the written request of the Administrative Agent or
any Lender, a complete description of the material terms of insurance
carried.  In addition to the requirements of the immediately preceding sentence,
the Borrower will at all times cause insurance of the types described in
Schedule VI to (x) be maintained (with the same scope of coverage as that
described in Schedule VI) at levels which are at least as great as the
respective amount described on Schedule VI and (y) comply with the insurance
requirements of the Vessel Mortgages.  
 
(b)  The Borrower will reimburse the Administrative Agent, Collateral Agent
and/or the Lenders for all costs, fees and expenses incurred in relation to
mortgagee interest insurance; provided that the Borrower shall not be required
to reimburse the Administrative Agent, Collateral Agent and/or the Lenders for
any costs, fees and expenses incurred in relation to mortgagee interest
insurance at any time (i) the Credit Parties own more than 10 Mortgaged Vessels
and (ii) the Appraised Value of each Mortgaged Vessels is less than 15% of the
Aggregate Appraised Value.
 
10.04  Corporate Franchises.  The Borrower will, and will cause each of its
Subsidiaries, to do or cause to be done, all things necessary to preserve and
keep in full force and effect its existence and its material rights, franchises,
licenses and patents (if any) used in its business; provided, however, that
nothing in this Section 10.04 shall prevent (i) sales or other dispositions of
assets, consolidations or mergers by or involving the Borrower or any of its
Subsidiaries which are permitted in accordance with Section 11.02, (ii) any
Subsidiary Guarantor from changing the jurisdiction of its organization to the
extent permitted by Section 11.12 or (iii) the abandonment by the Borrower or
any of its Subsidiaries of any rights, franchises, licenses and patents that
could not be reasonably expected to have a Material Adverse Effect.
 
 
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10.05  Compliance with Statutes, etc.  The Borrower will, and will cause each of
its Subsidiaries to, comply with all applicable statutes, regulations and orders
of, and all applicable restrictions (including all laws and regulations relating
to money laundering) imposed by, all governmental bodies, domestic or foreign,
in respect of the conduct of its business and the ownership of its property,
except such non-compliances as could not, either individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect.
 
10.06  Compliance with Environmental Laws.  (a)  The Borrower will, and will
cause each of its Subsidiaries to, comply in all material respects with all
Environmental Laws applicable to the ownership or use of any Vessel or property
now or hereafter owned or operated by the Borrower or any of its Subsidiaries,
will within a reasonable time period pay or cause to be paid all costs and
expenses incurred in connection with such compliance (except to the extent being
contested in good faith), and will keep or cause to be kept all such Vessel or
property free and clear of any Liens imposed pursuant to such Environmental
Laws.  Neither the Borrower nor any of its Subsidiaries will generate, use,
treat, store, release or dispose of, or permit the generation, use, treatment,
storage, release or disposal of, Hazardous Materials on any Vessel or property
now or hereafter owned or operated or occupied by the Borrower or any of its
Subsidiaries, or transport or permit the transportation of Hazardous Materials
to or from any ports or property except in material compliance with all
applicable Environmental Laws and as reasonably required by the trade in
connection with the operation, use and maintenance of any such property or
otherwise in connection with their businesses.  The Borrower will, and will
cause each of its Subsidiaries to, maintain insurance on the Vessels in at least
such amounts as are in accordance with normal industry practice for similarly
situated insureds, against losses from oil spills and other environmental
pollution.
 
(b)  At the written request of the Administrative Agent or the Required Lenders,
which request shall specify in reasonable detail the basis therefore, at any
time and from time to time, the Borrower will provide, at the Borrower’s sole
cost and expense, an environmental assessment of any Mortgaged Vessel by such
Vessel’s classification society (to the extent such classification society is
listed on Schedule IX hereto) or another internationally recognized
classification society acceptable to the Administrative Agent.  If said
classification society, in its assessment, indicates that such Mortgaged Vessel
is not in compliance with the Environmental Laws, said society shall set forth
potential costs of the remediation of such non-compliance; provided that such
request may be made only if (i) there has occurred and is continuing an Event of
Default, (ii) the Administrative Agent or the Required Lenders reasonably and in
good faith believe that the Borrower, any of its Subsidiaries or any such
Mortgaged Vessel is not in compliance with Environmental Law and such
non-compliance could reasonably be expected to have a Material Adverse Effect,
or (iii) circumstances exist that reasonably could be expected to form the basis
of a material Environmental Claim against the Borrower or any of its
Subsidiaries or any such Mortgaged Vessel.  If the Borrower fails to provide the
same within 90 days after such request was made, the Administrative Agent may
order the same and the Borrower shall grant and hereby grants to the
Administrative Agent and the Lenders and their agents access to such Mortgaged
Vessel and specifically grants the Administrative Agent and the Lenders an
irrevocable non-exclusive license, subject to the rights of tenants, to
undertake such an assessment, all at the Borrower’s expense.
 
 
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10.07  ERISA.  As soon as reasonably possible and, in any event, within ten (10)
days after the Borrower or any of its Subsidiaries or any ERISA Affiliate knows
or has reason to know of the occurrence of any of the following, the Borrower
will deliver to the Administrative Agent, with sufficient copies for each of the
Lenders, a certificate of the senior financial officer of the Borrower setting
forth the full details as to such occurrence and the action, if any, that the
Borrower, such Subsidiary or such ERISA Affiliate is required or proposes to
take, together with any notices required or proposed to be given to or filed
with or by the Borrower, the Subsidiary, the ERISA Affiliate, the PBGC, a Plan
participant or the Plan administrator with respect thereto:  that a Reportable
Event has occurred (except to the extent that the Borrower has previously
delivered to the Administrative Agent a certificate and notices (if any)
concerning such event pursuant to the next clause hereof); that a contributing
sponsor (as defined in Section 4001(a)(13) of ERISA) of a Plan subject to Title
IV of ERISA is subject to the advance reporting requirement of PBGC Regulation
Section 4043.61 (without regard to subparagraph (b)(1) thereof), and an event
described in subsection .62, .63, .64, .65, .66, .67 or .68 of PBGC Regulation
Section 4043 is reasonably expected to occur with respect to such Plan within
the following 30 days; that an accumulated funding deficiency, within the
meaning of Section 412 of the Code or Section 302 of ERISA, has been incurred or
an application may be or has been made for a waiver or modification of the
minimum funding standard (including any required installment payments) or an
extension of any amortization period under Section 412 of the Code or Section
303 or 304 of ERISA with respect to a Plan; that any contribution required to be
made with respect to a Plan or Foreign Pension Plan has not been timely made and
such failure could result in a material liability for the Borrower or any of its
Subsidiaries; that a Plan has been or may be reasonably expected to be
terminated, reorganized, partitioned or declared insolvent under Title IV of
ERISA with a material amount of unfunded benefit liabilities; that a Plan (in
the case of a Multiemployer Plan, to the best knowledge of the Borrower or any
of its Subsidiaries or ERISA Affiliates) has a material Unfunded Current
Liability; that proceedings may be reasonably expected to be or have been
instituted by the PBGC to terminate or appoint a trustee to administer a Plan
which is subject to Title IV of ERISA; that a proceeding has been instituted
pursuant to Section 515 of ERISA to collect a material delinquent contribution
to a Plan; that the Borrower, any of its Subsidiaries or any ERISA Affiliate
will or may reasonably expect to incur any material liability (including any
indirect, contingent, or secondary liability) to or on account of the
termination of or withdrawal from a Plan under Section 4062, 4063, 4064, 4069,
4201, 4204 or 4212 of ERISA or with respect to a Plan under Section 401(a)(29),
4971, 4975 or 4980 of the Code or Section 409 or 502(i) or 502(l) of ERISA or
with respect to a group health plan (as defined in Section 607(1) of ERISA or
Section 4980B(g)(2) of the Code) under Section 4980B of the Code; or that the
Borrower, or any of its Subsidiaries may incur any material liability pursuant
to any employee welfare benefit plan (as defined in Section 3(1) of ERISA) that
provides benefits to retired employees or other former employees (other than as
required by Section 601 of ERISA) or any Plan or any Foreign Pension Plan.  Upon
request, the Borrower will deliver to the Administrative Agent with sufficient
copies to the Lenders (i) a complete copy of the annual report (on Internal
Revenue Service Form 5500-series) of each Plan (including, to the extent
required, the related financial and actuarial statements and opinions and other
supporting statements, certifications, schedules and information) required to be
filed with the Internal Revenue Service and (ii) copies of any records,
documents or other information that must be furnished to the PBGC with respect
to any Plan pursuant to Section 4010 of ERISA.  In addition to any certificates
or notices delivered to the Lenders pursuant to the first sentence
 
 
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hereof, copies of annual reports and any records, documents or other information
required to be furnished to the PBGC, and any notices received by the Borrower,
any of its Subsidiaries or any ERISA Affiliate with respect to any Plan or
Foreign Pension Plan with respect to any circumstances or event that could
reasonably be expected to result in a material liability shall be delivered to
the Lenders no later than ten (10) days after the date such annual report has
been filed with the Internal Revenue Service or such records, documents and/or
information has been furnished to the PBGC or such notice has been received by
the Borrower, such Subsidiary or such ERISA Affiliate, as applicable.
 
10.08  End of Fiscal Years; Fiscal Quarters.  The Borrower will cause (i) each
of its, and each of its Subsidiaries’, fiscal years to end on December 31 of
each year and (ii) each of its and its Subsidiaries’ fiscal quarters to end on
March 31, June 30, September 30 and December 31 of each year.
 
10.09  Performance of Obligations.  The Borrower will, and will cause each of
its Subsidiaries to, perform all of its obligations under the terms of each
mortgage, indenture, security agreement and other debt instrument (including,
without limitation, the Documents) by which it is bound, except such
non-performances as could not, either individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect.
 
10.10  Payment of Taxes.  The Borrower will pay and discharge, and will cause
each of its Subsidiaries to pay and discharge, all material taxes, assessments
and governmental charges or levies imposed upon it or upon its income or
profits, or upon any properties belonging to it, in each case on a timely basis,
and all lawful claims for sums that have become due and payable which, if
unpaid, might become a Lien not otherwise permitted under Section 9.01(i),
provided that neither the Borrower nor any of its Subsidiaries shall be required
to pay any such tax, assessment, charge, levy or claim which is being contested
in good faith and by proper proceedings if it has maintained adequate reserves
with respect thereto in accordance with generally accepted accounting
principles.
 
10.11  Further Assurances.  (a)  The Borrower, and each other Credit Party,
agrees that at any time and from time to time, at the expense of the Borrower or
such other Credit Party, it will promptly execute and deliver all further
instruments and documents, and take all further action that may be reasonably
necessary, or that the Administrative Agent may reasonably require, to perfect
and protect any Lien granted or purported to be granted hereby or by the other
Credit Documents, or to enable the Collateral Agent to exercise and enforce its
rights and remedies with respect to any Collateral.  Without limiting the
generality of the foregoing, the Borrower will execute and file, or cause to be
filed, such financing or continuation statements under the UCC (or any non-U.S.
equivalent thereto), or amendments thereto, such amendments or supplements to
the Vessel Mortgages (including any amendments required to maintain Liens
granted by such Vessel Mortgages pursuant to the effectiveness of this
Agreement), and such other instruments or notices, as may be reasonably
necessary, or that the Administrative Agent may reasonably require, to protect
and preserve the Liens granted or purported to be granted hereby and by the
other Credit Documents.
 
(b)  The Borrower hereby authorizes the Collateral Agent to file one or more
financing or continuation statements under the UCC (or any non-U.S. equivalent
thereto), and
 
 
 
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amendments thereto, relative to all or any part of the Collateral without the
signature of the Borrower, where permitted by law.  The Collateral Agent will
promptly send the Borrower a copy of any financing or continuation statements
which it may file without the signature of the Borrower and the filing or
recordation information with respect thereto.
 
(c)  To the extent that any Vessel Acquisition or Vessel Exchange is made by a
Subsidiary of the Borrower which is not a Credit Party at the time of such
acquisition (and which has not otherwise executed and delivered the documents
described below in this Section 10.11(c)), the Borrower will cause such
Subsidiary (and any Subsidiary which directly owns the stock of such Subsidiary
to the extent not a Credit Party) to execute and deliver to the Administrative
Agent a counterpart of the Pledge Agreement (including any supplemental
agreement required to give effect to such security interests purported to be
created by the Pledge Agreement under applicable local law), the Guaranty,
Assignment of Earnings, Assignment of Insurances, Assignment of Charters (if
applicable) and the appropriate Vessel Mortgage(s), together with all related
documentation (including, without limitation, opinions of counsel, corporate
documents and proceedings and officer’s certificates) as such Subsidiary would
have been required to deliver pursuant to Sections 7 and 8 of this Agreement had
such Subsidiary been a Credit Party on a Borrowing Date.
 
10.12  Deposit of Earnings.  Each Credit Party will use its best efforts to
cause the earnings derived from each of the respective Mortgaged Vessels, to the
extent constituting Earnings and Insurance Collateral, to be deposited or
remitted by the respective account debtor in respect of such earnings into one
or more of the Operating Accounts maintained for such Credit Party or the
Borrower from time to time.  Without limiting any Credit Party’s obligations in
respect of this Section 10.12, each Credit Party agrees that, in the event it
receives any earnings constituting Earnings and Insurance Collateral, or any
such earnings are deposited other than in one of the Operating Accounts, it
shall promptly deposit all such proceeds into one of the Operating Accounts
maintained for such Credit Party or the Borrower from time to time.
 
10.13  Ownership of Subsidiaries.  The Borrower shall cause each Subsidiary
Guarantor, to at all times, be directly wholly-owned by one or more Credit
Parties.
 
10.14  Flag of Mortgaged Vessels; Vessel Classifications.  (a)  When required by
the terms hereof, the Borrower will, and will cause each of its Subsidiaries to,
cause each Mortgaged Vessel to be registered under the laws and flag of (x) Hong
Kong, (y) the Republic of Marshall Islands or (z) any other jurisdiction
acceptable to the Required Lenders (each jurisdiction in clauses (x), (y) or
(z), an “Acceptable Flag Jurisdiction”).  Notwithstanding the foregoing, any
Credit Party may transfer a Mortgaged Vessel registered in an Acceptable Flag
Jurisdiction to another Acceptable Flag Jurisdiction pursuant to a Flag
Jurisdiction Transfer.
 
(b)  The Borrower will, and will cause each of its Subsidiaries to, insure that
the representation set forth in Section 9.23 is true and correct in all respects
at all times.
 
(c)           The Borrower or the respective Subsidiary Guarantor will, and will
cause each of its subsidiaries, to insure that they immediately notify the
Administrative Agent of any actual or threatened withdrawal of a SMC or DOC.
 
 
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10.15  Consent to Assignment of Charters.  The Borrower will, and will cause
each of its Subsidiaries to, use its commercially reasonable efforts to cause
each charter counterparty which is party to a charter with respect to each
Mortgaged Vessel that is one year or more in duration to execute and deliver to
the Administrative Agent a Charterers’ Consent and Agreement in substantially
the form attached as Annex 1 to Exhibit B to the Assignment of Charters with
such changes as may be approved by the Administrative Agent.
 
10.16  Age of Additional Vessels.  The Borrower will, and will cause each of its
Subsidiaries to, cause each Additional Vessel to be no greater than 18 years of
age on the Maturity Date.
 
10.17  Existing Credit Agreement.  From the period beginning on or after the
Effective Date until the date the Refinancing Loan is made, the Borrower will,
and will cause each of its Subsidiaries to, comply with all covenants contained
in the Existing Credit Agreement, the Revolving Credit Agreement and the Credit
Documents (as defined therein).
 
SECTION 11.  Negative Covenants.  The Borrower hereby covenants and agrees that
on and after the Effective Date and until the Total Commitment and all Letters
of Credit have terminated and the Loans, Notes and Unpaid Drawings, together
with interest, Commitment Commission and all other Obligations incurred
hereunder and thereunder, are paid in full:
 
11.01  Liens.  The Borrower will not, and will not permit any of its
Subsidiaries to, create, incur, assume or suffer to exist any Lien upon or with
respect to any Collateral, whether now owned or hereafter acquired, or sell any
such Collateral subject to an understanding or agreement, contingent or
otherwise, to repurchase such Collateral (including sales of accounts receivable
with recourse to the Borrower or any of its Subsidiaries), or assign any right
to receive income or permit the filing of any financing statement under the UCC
or any other similar notice of Lien under any similar recording or notice
statute with respect to any Collateral; provided that the provisions of this
Section 11.01 shall not prevent the creation, incurrence, assumption or
existence of the following (Liens described below are herein referred to as
“Permitted Liens”):
 
(i)  inchoate Liens for taxes, assessments or governmental charges or levies not
yet due and payable or Liens for taxes, assessments or governmental charges or
levies being contested in good faith and by appropriate proceedings for which
adequate reserves have been established in accordance with GAAP;
 
(ii)  Liens imposed by law, which were incurred in the ordinary course of
business and do not secure Indebtedness for borrowed money, such as carriers’,
warehousemen’s, materialmen’s and mechanics’ liens, liens for necessaries,
salvage liens, general average liens, liens in respect of or covered by
insurance (including permitted deductibles) and other similar Liens arising in
the ordinary course of business, and (x) which do not in the aggregate
materially detract from the value of the Collateral and do not materially impair
the use thereof in the operation of the business of the Borrower or such
Subsidiary or (y) which are being contested in good faith by appropriate
proceedings, which proceedings (or orders entered in connection with such
proceedings) have the effect of preventing the forfeiture or sale of the
Collateral subject to any such Lien;
 
 
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(iii)  Permitted Encumbrances;
 
(iv)  Liens created pursuant to the Security Documents;
 
(v)  Liens arising out of judgments, awards, decrees or attachments with respect
to which the Borrower or any of its Subsidiaries shall in good faith be
prosecuting an appeal or proceedings for review, provided that the aggregate
amount of all such judgments, awards, decrees or attachments shall not
constitute an Event of Default under Section 12.09;
 
(vi)  Liens (other than any Lien imposed by ERISA) incurred or deposits made in
the ordinary course of business in connection with workers’ compensation,
unemployment insurance and other types of social security, Liens to secure the
performance of tenders, statutory obligations (other than excise taxes), surety,
stay, customs and appeal bonds, statutory bonds, bids, leases, government
contracts, trade contracts, performance and return of money bonds and other
similar obligations in each case incurred in the ordinary course of business
(exclusive of obligations for the payment of borrowed money) and Liens arising
by virtue of deposits made in the ordinary course of business to secure
liability for premiums to insurance carriers; provided that the aggregate value
of all cash and property at any time encumbered pursuant to this clause
(vi) shall not exceed $2,500,000;
 
(vii)  Liens in respect of seamen’s wages which are not past due and other
maritime Liens for amounts not past due arising in the ordinary course of
business and not yet required to be removed or discharged under the terms of the
respective Vessel Mortgages; and,
 
(viii)                prior to the making of the Refinancing Loan, liens
currently securing amounts payable under the Existing Credit Facility and
Revolving Credit Facility.
 
In connection with the granting of Liens described above in this Section 11.01
by the Borrower or any of its Subsidiaries, the Administrative Agent and the
Collateral Agent shall be authorized to take any actions deemed appropriate by
it in connection therewith (including, without limitation, by executing
appropriate lien subordination agreements in favor of the holder or holders of
such Liens, in respect of the item or items of equipment or other assets subject
to such Liens).
 
11.02  Consolidation, Merger, Sale of Assets, etc.  The Borrower will not, and
will not permit any Subsidiary Guarantor to, wind up, liquidate or dissolve its
affairs or enter into any transaction of merger or consolidation, or convey,
sell, lease or otherwise dispose of all or substantially all of its assets or
any of the Collateral, or enter into any sale-leaseback transactions involving
any of the Collateral, except that:
 
(i)  the Borrower and each of its Subsidiaries may sell, lease or otherwise
dispose of any Mortgaged Vessel, provided that (x)(A) such sale is made at fair
market value (as determined in accordance with the Appraisals most recently
delivered to the Administrative Agent (or obtained by the Administrative Agent)
pursuant to Sections 7.08(iv), 8.02(g)(iv) and 10.01(c) or delivered at the time
of such sale to the Administrative Agent by the Borrower), (B) 100% of the
consideration in respect of such sale shall consist of cash or Cash Equivalents
received by the Borrower, or the respective Subsidiary Guarantor which owned
such Mortgaged Vessel, on the date of consummation of such sale, (C) at the time
of
 
 
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such sale or other disposition, the Borrower shall apply the proceeds of such
sale as required by Section 4.02(b) to repay outstanding Loans or (y) so long as
no Default or Event of Default has occurred and is continuing (or would arise
after giving effect thereto) and so long as all representations and warranties
made by the Borrower pursuant to Section 9 of this Agreement are true and
correct both before and after any such exchange, such Mortgaged Vessel is
exchanged for a Acceptable Replacement Vessel pursuant to a Vessel Exchange;
provided further that in the case of both clause (x) and (y) above, that the
Borrower shall have delivered to the Administrative Agent an officer’s
certificate, certified by the senior financial officer of the Borrower,
demonstrating pro forma compliance (giving effect to such Collateral Disposition
and, in the case of calculations involving the Appraised Value of Mortgaged
Vessels, using valuations consistent with the Appraisals most recently delivered
to the Administrative Agent (or obtained by the Administrative Agent) pursuant
to Sections 7.08(iv), 8.02(g)(iv) and 10.01(c) or the definition of Vessel
Exchange) with each of the covenants set forth in Sections 11.07 through 11.11,
inclusive, for the most recently ended Test Period (or at the time of such sale
or exchange, as applicable) and projected compliance with such covenants for the
one year period following such Collateral Disposition, in each case setting
forth the calculations required to make such determination in reasonable detail;
 
(ii)  the Borrower and its Subsidiaries may sell or discount, in each case
without recourse and in the ordinary course of business, overdue accounts
receivable arising in the ordinary course of business, but only in connection
with the compromise or collection thereof consistent with customary industry
practice (and not as part of any bulk sale);
 
(iii)  (A) any Subsidiary Guarantor may transfer assets or lease to or acquire
or lease assets from any other Subsidiary Guarantor and (B) any Subsidiary of
the Borrower (other than a Subsidiary Guarantor) may transfer assets or lease to
or acquire or lease assets from any other Subsidiary of the Borrower (other than
a Subsidiary Guarantor) or any Subsidiary of the Borrower (other than a
Subsidiary Guarantor) may be merged into any Subsidiary of the Borrower (other
than a Subsidiary Guarantor) or any Subsidiary Guarantor may be merged into any
other Subsidiary Guarantor, in each case so long as all actions necessary or
desirable to preserve, protect and maintain the security interest and Lien of
the Collateral Agent in any Collateral held by any Person involved in any such
transaction are taken to the satisfaction of the Administrative Agent;
 
(iv)  following a Collateral Disposition permitted by this Agreement, the
Subsidiary Guarantor which owned the Vessel that is the subject of such
Collateral Disposition may dissolve, provided, that (x) all proceeds from such
Collateral Disposition shall have been applied to repayment of the Loans to the
extent required in Section 4.02 of this Agreement, (y) all of the proceeds of
such dissolution shall be paid only to the Borrower and (z) no Event of Default
is continuing unremedied at the time of such dissolution; and
 
(v)  the Borrower may consolidate or merge with any other Person if (A) at the
time of such transaction and after giving effect thereto, no Default or Event of
Default shall have occurred and be continuing and (B) the surviving entity in
such consolidation or merger shall be the Borrower and the Borrower shall have
delivered to the Administrative Agent, not less than ten (10) Business Days in
advance of such consolidation or merger, an officer’s certificate signed by a
senior financial officer of the Borrower, certifying (i) that no Default
 
 
 
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or Event of Default has occurred and is continuing (or would arise after giving
effect to the intended consolidation or merger) and (ii) pro forma financial
statements of the Borrower demonstrating the compliance of the Borrower with all
covenants under this Agreement after giving effect to such merger or
consolidation.
 
Notwithstanding the foregoing, the Borrower will not, and will not permit any
Subsidiary Guarantor to, enter into any bareboat charter of any Mortgaged Vessel
without the prior written consent of the Required Lenders.
 
To the extent the Required Lenders waive the provisions of this Section 11.02
with respect to the sale of any Collateral, or any Collateral is sold as
permitted by this Section 11.02, such Collateral (unless sold to the Borrower or
a Subsidiary of the Borrower) shall be sold free and clear of the Liens created
by the Security Documents, and the Administrative Agent and Collateral Agent
shall be authorized to take any actions deemed appropriate in order to effect
the foregoing.
 
11.03  Dividends.  The Borrower will not, and will not permit any of its
Subsidiaries to, authorize, declare or pay any Dividends with respect to the
Borrower or any of its Subsidiaries, except that:
 
(i)  (x) any Subsidiary of the Borrower which is not a Subsidiary Guarantor may
pay Dividends to the Borrower or any Wholly-Owned Subsidiary of the Borrower,
(y) any Subsidiary Guarantor may pay Dividends to the Borrower or any other
Subsidiary Guarantor and (z) if the respective Subsidiary is not a Wholly-Owned
Subsidiary of the Borrower, such Subsidiary may pay cash dividends to its
shareholders generally so long as the Borrower and/or its respective
Subsidiaries which own equity interests in the Subsidiary paying such Dividends
receive at least their proportionate share thereof (based upon their relative
holdings of the equity interests in the Subsidiary paying such Dividends and
taking into account the relative preferences, if any, of the various classes of
equity interests of such Subsidiary);
 
(ii)  the Borrower may make, pay or declare cash Dividends; provided that, for
all Dividends paid pursuant to this clause (ii), (A) Dividends shall be paid
within 90 days of the declaration thereof; (B) Dividends paid in respect of a
fiscal quarter shall only be paid after the date of delivery of quarterly or
annual financial statements for such fiscal quarter, pursuant to Sections
10.01(a) and (b), as the case may be, and on or prior to 45 days after the last
day of the immediately succeeding fiscal quarter, (C) no Default or Event of
Default has occurred and is continuing at the time of declaration, (D) no
Default or Event of Default has occurred and is continuing (or would arise after
giving effect thereto) at the time of payment, (E) the aggregate amount of all
Dividends paid in respect of a fiscal quarter shall not exceed the Permitted
Dividend Amount for such fiscal quarter and (F) on or prior to the declaration
and payment of a Dividend, the Borrower shall deliver to the Administrative
Agent an officer’s certificate signed by the senior financial officer of the
Borrower, certifying that the requirements set forth in preceding clauses (A)
through (E) are satisfied and setting forth the calculation of the Permitted
Dividend Amount in reasonable detail; and
 
 
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(iii)  the Borrower may authorize, declare and distribute a dividend of Rights
(as such term is defined and which are convertible into other securities as set
forth in the Shareholder Rights Agreement) as contemplated by the Shareholder
Rights Agreement.
 
11.04  Indebtedness.  (a)  The Borrower will not, and will not permit any of its
Subsidiaries to, contract, create, incur, assume or suffer to exist any
Indebtedness (other than Indebtedness incurred pursuant to this Agreement and
the other Credit Documents) except that:
 
(i)  the Borrower and its Subsidiaries (other than a Subsidiary Guarantor) may
incur Indebtedness so long as (x) no Default or Event of Default has occurred
and is continuing, (y) such Indebtedness would not cause any Default or Event of
Default, either on a pro forma basis for the most recently ended Test Period (or
at the time of such incurrence, as applicable), or on a projected basis for the
one year period following such incurrence, with each of the covenants set forth
in Sections 11.07 through 11.11, inclusive, and (z) the Borrower shall have
delivered an officer’s certificate from the senior financial officer of the
Borrower certifying that the conditions set forth in clause (x) and (y) above
are satisfied and setting forth the calculations of the pro forma compliance
described in clause (y) above in reasonable detail; and
 
(ii)  the Borrower and its Subsidiaries may enter into and remain liable under
Interest Rate Protection Agreements and Other Hedging Agreements entered into in
the ordinary course of business and not for speculative purposes; provided that
the Borrower’s and the Subsidiaries’ obligations thereunder are fully
subordinate to their obligations hereunder on terms satisfactory to the
Administrative Agent; and
 
(iii)  prior to the making of the Refinancing Loan, Indebtedness arising under
the Existing Credit Facility and the Revolving Credit Facility.
 
(b)  Notwithstanding anything to the contrary set forth above in this Section
11.04, (i) no Subsidiary Guarantor shall incur any Indebtedness for borrowed
money (including Contingent Obligations in respect thereof) except for
(x) Indebtedness incurred pursuant to this Agreement and the other Credit
Documents and (y) intercompany Indebtedness permitted pursuant to Section
11.05(iii) and (ii) the Borrower and the Subsidiary Guarantors shall not assume,
incur or suffer to exist any Contingent Obligations in respect of any
Indebtedness of any of its Subsidiaries which is not a Credit Party.
 
11.05  Advances, Investments and Loans.  The Borrower will not, and will not
permit any of its Subsidiaries to, directly or indirectly, lend money or credit
or make advances to any Person, or purchase or acquire any Equity Interests, or
make any capital contribution to any other Person (each of the foregoing an
“Investment” and, collectively, “Investments”) except that the following shall
be permitted:
 
(i)  the Borrower and its Subsidiaries may acquire and hold accounts receivable
owing to any of them;
 
(ii)  so long as no Event of Default exists or would result therefrom, the
Borrower and its Subsidiaries may make loans and advances in the ordinary course
of business to its employees so long as the aggregate principal amount thereof
at any time outstanding which
 
 
 
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are made on or after the Effective Date (determined without regard to any
write-downs or write-offs of such loans and advances) shall not exceed $500,000;
 
(iii)  the Subsidiary Guarantors may make intercompany loans and advances to the
Borrower and between or among one another, and Subsidiaries of the Borrower
other than the Subsidiary Guarantors may make intercompany loans and advances to
the Borrower or any other Subsidiary of the Borrower, provided that any loans or
advances to the Borrower or any Subsidiary Guarantors pursuant to this Section
11.05(iii) shall be subordinated to the Obligations of the respective Credit
Party pursuant to written subordination provisions substantially in the form of
Exhibit J;
 
(iv)  the Borrower and its Subsidiaries may sell or transfer assets to the
extent permitted by Section 11.02;
 
(v)  the Borrower may make Investments in the Subsidiary Guarantors and, so long
as no Event of Default exists and is continuing, the Borrower may make
Investments in its other Wholly-Owned Subsidiaries so long as management of the
Borrower in good faith believe that, after giving effect to such Investment, the
Borrower shall be able to meet its payment obligations in respect of this
Agreement;
 
(vi)  so long as no Event of Default exists or could reasonably be expected to
result therefrom, the Borrower and its Subsidiaries (other than the Subsidiary
Guarantors) may make Investments in joint ventures in the ordinary course of
business; and.
 
(vii)  so long as no Event of Default exists or could reasonably be expected to
result therefrom, the Borrower and its Subsidiaries (other than the Subsidiary
Guarantors) may make Investments in a Person engaged in drybulk shipping
operations.
 
11.06  Transactions with Affiliates.  The Borrower will not, and will not permit
any of its Subsidiaries to, enter into any transaction or series of related
transactions, whether or not in the ordinary course of business, with any
Affiliate of such Person, other than in the ordinary course of business and on
terms and conditions no less favorable to such Person as would be obtained by
such Person at that time in a comparable arm’s-length transaction with a Person
other than an Affiliate, except that:
 
(i)  Dividends may be paid to the extent provided in Section 11.03;
 
(ii)  loans and other Investments may be made and other transactions may be
entered into between the Borrower and its Subsidiaries to the extent permitted
by Sections 11.04 and 11.05;
 
(iii)  the Borrower may pay customary director’s fees;
 
(iv)  the Borrower and its Subsidiaries may enter into employment agreements or
arrangements with their respective officers and employees in the ordinary course
of business; and
 
 
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(v)  the Borrower and its Subsidiaries may pay management fees to Wholly-Owned
Subsidiaries of the Borrower in the ordinary course of business.
 
11.07  Consolidated Interest Coverage Ratio.  The Borrower will not permit the
Consolidated Interest Coverage Ratio for any Test Period, in each case taken as
one accounting period, ending on the last day of any fiscal quarter of the
Borrower (commencing with the fiscal quarter ending September 30, 2007), to be
less than 2.00:1.00.
 
11.08  Maximum Leverage Ratio.  The Borrower will not permit the Leverage Ratio
on the last day of any fiscal quarter of the Borrower ended on or after the
Effective Date, to be greater than 5.50.
 
11.09  Collateral Maintenance.  The Borrower will not permit the Aggregate
Appraised Value at any time to equal less than 130% of the aggregate principal
amount of outstanding Loans and all Letter of Credit Outstandings at such time,
provided that, so long as any Default in respect of this Section 11.09 is not
caused by any voluntary Collateral Disposition or a Vessel Exchange, such
Default shall not constitute an Event of Default so long as within 30 days after
such shortfall, the Borrower makes such repayments of Loans or reduces the
Letter of Credit Outstandings in an amount sufficient to cure such Default (it
being understood that any action taken in respect of this proviso shall only be
effective to cure such default pursuant to this Section 11.09 to the extent that
no Default or Event of Default exists hereunder immediately after giving effect
thereto).
 
11.10  Minimum Cash Balance.  The Borrower will not permit the aggregate amount
of all (x) cash and Cash Equivalents held by the Borrower and its Subsidiaries
which is subject to the Lien of the Security Documents and (y) all undrawn
credit facilities to the extent the proceeds thereof are available to fund the
working capital requirements of the Borrower and the Subsidiary Guarantors with
maturities in excess of twelve months on the last day of any fiscal quarter
(commencing with and including the fiscal quarter ended June 30, 2007) to be
less than $500,000 per Mortgaged Vessel.
 
11.11  Minimum Consolidated Net Worth.  The Borrower will not permit its
Consolidated Net Worth at any time to be less than the Minimum Consolidated Net
Worth.
 
11.12  Limitation on Modifications of Certificate of Incorporation and By-Laws;
etc.  (a)  The Borrower will not, and will not permit any Subsidiary Guarantor
to, amend, modify or change its Certificate of Incorporation, Certificate of
Formation (including, without limitation, by the filing or modification of any
certificate of designation), By-Laws, limited liability company agreement,
partnership agreement (or equivalent organizational documents) or any agreement
entered into by it with respect to its capital stock or membership interests (or
equivalent equity interests), or enter into any new agreement with respect to
its capital stock or membership interests (or equivalent interests), other than
the Shareholders Rights Agreement, the Certificate of Designations of Series A
Preferred Stock in substantially the form attached thereto as Exhibit A or any
amendments, modifications or changes or any such new agreements which are not in
any way materially adverse to the interests of the Lenders.
 
 
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(b)  Notwithstanding the foregoing provisions of this Section 11.12 or Section
10.04, upon not less than 30 days prior written notice to the Administrative
Agent and so long as no Default or Event of Default exists and is continuing,
any Subsidiary Guarantor may (x) change its jurisdiction of organization to
another jurisdiction and (y) change its form of organization to another form, in
each case to the extent reasonably satisfactory to the Administrative Agent,
provided that such Subsidiary Guarantor shall promptly take all actions
reasonably deemed necessary by the Collateral Agent to preserve, protect and
maintain, without interruption, the security interest and Lien of the Collateral
Agent in any Collateral owned by such Subsidiary Guarantor to the satisfaction
of the Collateral Agent, and such Subsidiary Guarantor shall have provided to
the Administrative Agent and the Lenders such opinions of counsel as may be
reasonably requested by the Administrative Agent to assure itself that the
conditions of this proviso have been satisfied.
 
11.13  Limitation on Certain Restrictions on Subsidiaries.  The Borrower will
not, and will not permit any of its Subsidiaries to, directly or indirectly,
create or otherwise cause or suffer to exist or become effective any encumbrance
or restriction on the ability of any such Subsidiary to (a) pay dividends or
make any other distributions on its capital stock or any other interest or
participation in its profits owned by the Borrower or any Subsidiary of the
Borrower, or pay any Indebtedness owed to the Borrower or a Subsidiary of the
Borrower, (b) make loans or advances to the Borrower or any of the Borrower’s
Subsidiaries or (c) transfer any of its properties or assets to the Borrower or
any of the Borrower’s Subsidiaries, except for such encumbrances or restrictions
existing under or by reason of (i) applicable law, (ii) this Agreement and the
other Documents, (iii) customary provisions restricting subletting or assignment
of any lease governing a leasehold interest of the Borrower or a Subsidiary of
the Borrower, (iv) customary provisions restricting assignment of any agreement
entered into by the Borrower or a Subsidiary of the Borrower in the ordinary
course of business, (v) any holder of a Permitted Lien may restrict the transfer
of the asset or assets subject thereto and (vi) restrictions which are not more
restrictive than those contained in this Agreement.
 
11.14  Limitation on Issuance of Capital Stock.  (a)  The Borrower will not
permit any Subsidiary to issue any preferred stock (or equivalent equity
interests).
 
(b)  The Borrower will not permit any Subsidiary Guarantor to issue any capital
stock (including by way of sales of treasury stock) or any options or warrants
to purchase, or securities convertible into, capital stock, except (i) for
transfers and replacements of then outstanding shares of capital stock, (ii) for
stock splits, stock dividends and additional issuances which do not decrease the
percentage ownership of the Borrower or any of its Subsidiaries in any class of
the capital stock of such Subsidiary and (iii) in the case of Foreign
Subsidiaries of the Borrower, to qualify directors to the extent required by
applicable law.  All capital stock of any Subsidiary Guarantor issued in
accordance with this Section 11.14(b) shall be delivered to the Collateral Agent
pursuant to the Pledge Agreement.
 
11.15  Business.  (a)  The Borrower and its Subsidiaries will not engage in any
business other than the businesses in which they are engaged in as of the
Effective Date and activities directly related thereto, and similar or related
businesses.
 
 
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(b)  The Borrower will not, and will not permit any of its Subsidiaries to,
(i) be engaged in (A) the retailing, wholesaling, trading or importing of goods
or services for or with residents of the Republic of the Marshall Islands;
(B) any extractive industry in the Republic of Marshall Islands; (C) any
regulated professional service activity in the Republic of the Marshall Islands;
(D) the export of any commodity or goods manufactured, processed, mined or made
in the Republic of the Marshall Islands; or (E) the ownership of real property
in the Republic of the Marshall Islands; and (ii) do business in the Republic of
the Marshall Islands except that  the Borrower and their Subsidiaries may
(A) have its registered office in the Republic of the Marshall Islands and
maintain their respective registered agent in the Republic of the Marshall
Islands as required by the provisions of the Associations Law of 1990 of the
Republic of the Marshall Islands, as amended; and (B) secure and maintain
registry in the Republic of the Marshall Islands solely related to the operation
or disposition of any vessel outside of the Republic of the Marshall Islands.
 
11.16  Bank Accounts.  The Borrower will not, and will not permit any Subsidiary
Guarantor to, maintain any deposit, savings, investment or other similar
accounts other than the Operating Accounts, except that the Borrower may open
and maintain any such account provided that it shall have granted to the
Administrative Agent a first priority security interest in such account to
secure the Obligations pursuant to documentation reasonably satisfactory to the
Administrative Agent and all actions necessary or advisable in the reasonable
opinion of the Administrative Agent to perfect such security interest shall have
been taken.
 
SECTION 12.  Events of Default.  Upon the occurrence of any of the following
specified events (each an “Event of Default”):
 
12.01  Payments.  The Borrower shall (i) default in the payment when due of any
Unpaid Drawings or any principal of any Loan or any Note or (ii) default, and
such default shall continue unremedied for three or more Business Days, in the
payment when due of any interest on any Loan or Note, Unpaid Drawing or any
Commitment Commission, Letter of Credit Fee or any other amounts owing hereunder
or thereunder; or
 
12.02  Representations, etc.  Any representation, warranty or statement made or
deemed made by any Credit Party herein or in any other Credit Document or in any
certificate delivered pursuant hereto or thereto shall prove to be untrue in any
material respect on the date as of which made or deemed made; or
 
12.03  Covenants.  Any Credit Party shall (i) default in the due performance or
observance by it of any term, covenant or agreement contained in Sections 7,
10.01(f)(i), 10.03(ii), 10.13, 10.14, 10.17 or Section 11 or (ii) default in the
due performance or observance by it of any other term, covenant or agreement
contained in this Agreement and, in the case of this clause (ii), such default
shall continue unremedied for a period of 30 days after written notice to the
Borrower by the Administrative Agent or any of the Lenders; or
 
12.04  Default Under Other Agreements.  (i) The Borrower or any of its
Subsidiaries shall default in any payment of any Indebtedness (other than the
Obligations) beyond the period of grace, if any, provided in the instrument or
agreement under which such Indebtedness was created or (ii) the Borrower or any
of its Subsidiaries shall default in the
 
 
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observance or performance of any agreement or condition relating to any
Indebtedness (other than the Obligations) or contained in any instrument or
agreement evidencing, securing or relating thereto, or any other event shall
occur or condition exist, the effect of which default or other event or
condition is to cause, or to permit the holder or holders of such Indebtedness
(or a trustee or agent on behalf of such holder or holders) to cause (determined
without regard to whether any notice is required), any such Indebtedness to
become due prior to its stated maturity, or (iii) any Indebtedness (other than
the Obligations) of the Borrower or any of its Subsidiaries shall be declared to
be due and payable, or required to be prepaid other than by a regularly
scheduled required prepayment, prior to the stated maturity thereof, provided
that it shall not be a Default or Event of Default under this Section 12.04
unless the aggregate principal amount of all Indebtedness as described in
preceding clauses (i) through (iii), inclusive, exceeds $5,000,000 at any time;
or
 
12.05  Bankruptcy, etc.  The Borrower or any of its Subsidiaries shall commence
a voluntary case concerning itself under Title 11 of the United States Code
entitled “Bankruptcy,” as now or hereafter in effect, or any successor thereto
(the “Bankruptcy Code”); or an involuntary case is commenced against the
Borrower or any of its Subsidiaries and the petition is not controverted within
20 days after service of summons, or is not dismissed within 60 days, after
commencement of the case; or a custodian (as defined in the Bankruptcy Code) is
appointed for, or takes charge of, all or substantially all of the property of
the Borrower or any of its Subsidiaries or the Borrower or any of its
Subsidiaries commences any other proceeding under any reorganization,
arrangement, adjustment of debt, relief of debtors, dissolution, insolvency or
liquidation or similar law of any jurisdiction whether now or hereafter in
effect relating to the Borrower or any of its Subsidiaries or there is commenced
against the Borrower or any of its Subsidiaries any such proceeding which
remains undismissed for a period of 60 days, or the Borrower or any of its
Subsidiaries is adjudicated insolvent or bankrupt; or any order of relief or
other order approving any such case or proceeding is entered; or the Borrower or
any of its Subsidiaries suffers any appointment of any custodian or the like for
it or any substantial part of its property to continue undischarged or unstayed
for a period of 60 days; or the Borrower or any of its Subsidiaries makes a
general assignment for the benefit of creditors; or any corporate action is
taken by the Borrower or any of its Subsidiaries for the purpose of effecting
any of the foregoing; or
 
12.06  ERISA.  (a)  Any Plan shall fail to satisfy the minimum funding standard
required for any plan year or part thereof under Section 412 of the Code or
Section 302 of ERISA or a waiver of such standard or extension of any
amortization period is sought or granted under Section 412 of the Code or
Section 303 or 304 of ERISA, a Reportable Event shall have occurred, a
contributing sponsor (as defined in Section 4001(a)(13) of ERISA) of a Plan
subject to Title IV of ERISA shall be subject to the advance reporting
requirement of PBGC Regulation Section 4043.61 (without regard to subparagraph
(b)(1) thereof) and an event described in subsection .62, .63, .64, .65, .66,
.67 or .68 of PBGC Regulation Section 4043 shall be reasonably expected to occur
with respect to such Plan within the following 30 days, any Plan which is
subject to Title IV of ERISA shall have had or is reasonably likely to have a
trustee appointed to administer such Plan, any Plan which is subject to Title IV
of ERISA is, shall have been or is reasonably likely to be terminated or to be
the subject of termination proceedings under ERISA, any Plan shall have an
Unfunded Current Liability, a contribution required to be made with respect to a
Plan or a Foreign Pension Plan is not timely made, the Borrower or any of
 
 
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its Subsidiaries or any ERISA Affiliate has incurred or events have happened, or
reasonably expected to happen, that will cause it to incur any liability to or
on account of a Plan under Section 409, 502(i), 502(l), 515, 4062, 4063, 4064,
4069, 4201, 4204 or 4212 of ERISA or Section 401(a)(29), 4971 or 4975 of the
Code or on account of a group health plan (as defined in Section 607(1) of ERISA
or Section 4980B(g)(2) of the Code) under Section 4980B of the Code, or the
Borrower, or any of its Subsidiaries, has incurred or is reasonably likely to
incur liabilities pursuant to one or more employee welfare benefit plans (as
defined in Section 3(1) of ERISA) that provide benefits to retired employees or
other former employees (other than as required by Section 601 of ERISA) or Plans
or Foreign Pension Plans; (b) there shall result from any such event or events
the imposition of a lien, the granting of a security interest, or a liability or
a material risk of incurring a liability; and (c) such lien, security interest
or liability, either individually and/or in the aggregate, in the reasonable
opinion of the Required Lenders, has had, or could reasonably be expected to
have, a Material Adverse Effect; or
 
12.07  Security Documents.  At any time after the execution and delivery
thereof, any of the Security Documents shall cease to be in full force and
effect, or shall cease in any material respect to give the Collateral Agent for
the benefit of the Secured Creditors the Liens, rights, powers and privileges
purported to be created thereby (including, without limitation, a perfected
security interest in, and Lien on, all of the Collateral), in favor of the
Collateral Agent, superior to and prior to the rights of all third Persons
(except in connection with Permitted Liens), and subject to no other Liens
(except Permitted Liens), or any Credit Party shall default in the due
performance or observance of any term, covenant or agreement on its part to be
performed or observed pursuant to any of the Security Documents and such default
shall continue beyond any grace period (if any) specifically applicable thereto
pursuant to the terms of such Security Document, or any “event of default” (as
defined in any Vessel Mortgage) shall occur in respect of any Vessel Mortgage;
or
 
12.08  Guaranty.  After the execution and delivery thereof, the Guaranty, or any
provision thereof, shall cease to be in full force or effect as to the relevant
Subsidiary Guarantor (unless such  Subsidiary Guarantor is no longer a
Subsidiary by virtue of a liquidation, sale, merger or consolidation permitted
by Section 11.02) or any Subsidiary Guarantor (or Person acting by or on behalf
of such Subsidiary Guarantor) shall deny or disaffirm such Subsidiary
Guarantor’s obligations under the Guaranty, or Subsidiary Guarantor, shall
default in the due performance or observance of any term, covenant or agreement
on its part to be performed or observed pursuant to the Guaranty beyond any
grace period (if any) provided therefore; or
 
12.09  Judgments.  One or more judgments or decrees shall be entered against the
Borrower or any of its Subsidiaries involving in the aggregate for the Borrower
and its Subsidiaries a liability (not paid or fully covered by a reputable and
solvent insurance company to the satisfaction of the Administrative Agent) and
such judgments and decrees either shall be final and non-appealable or shall not
be vacated, discharged or stayed or bonded pending appeal for any period of 60
consecutive days, and the aggregate amount of all such judgments, to the extent
not covered by insurance, exceeds $5,000,000 at any time; or
 
12.10  Change of Control.  A Change of Control shall occur;
 
 
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then, and in any such event, and at any time thereafter, if any Event of Default
shall then be continuing, the Administrative Agent, upon the written request of
the Required Lenders, shall by written notice to the Borrower, take any or all
of the following actions, without prejudice to the rights of the Administrative
Agent, any Lender or the holder of any Note to enforce its claims against any
Credit Party (provided that, if an Event of Default specified in Section 12.05
shall occur, the result which would occur upon the giving of written notice by
the Administrative Agent to the Borrower as specified in clauses (i), (ii) and
(iv) below shall occur automatically without the giving of any such
notice):  (i) declare the Commitments terminated, whereupon all Commitments of
each Lender shall forthwith terminate immediately and any Commitment Commission
shall forthwith become due and payable without any other notice of any kind;
(ii) declare the principal of and any accrued interest in respect of all Loans
and the Notes and all Obligations owing hereunder and thereunder to be,
whereupon the same shall become, forthwith due and payable without presentment,
demand, protest or other notice of any kind, all of which are hereby waived by
each Credit Party; (iii) terminate any Letter of Credit that may be terminated
in accordance with its terms; (iv) direct the Borrower to pay (and the Borrower
agrees that upon receipt of such notice, or upon the occurrence and during the
continuance of an Event of Default specified in Section 12.05, it will pay) to
the Collateral Agent at the Payment Office such additional amount of cash, to be
held as security by the Collateral Agent, as is equal to the aggregate Stated
Amount of all Letters of Credit issued for the Borrower and then outstanding;
and (v) enforce, as Collateral Agent, all of the Liens and security interests
created pursuant to the Security Documents.
 
SECTION 13.  Definitions and Accounting Terms.
 
13.01  Defined Terms.  As used in this Agreement, the following terms shall have
the following meanings (such meanings to be equally applicable to both the
singular and plural forms of the terms defined):
 
“Acceptable Flag Jurisdiction” shall have the meaning provided in Section 10.14.
 
“Acceptable Replacement Vessel” shall mean, with respect to a Mortgaged Vessel,
any Vessel with an equal or greater fair market value than the Appraised Value
of such Mortgaged Vessel; provided that such Vessel must (i) be ofthe same type
and age as the Mortgaged Vessel it replaces, (ii) have a class complying with
the requirements of Section 10.14, (iii) be registered and flagged in an
Acceptable Flag Jurisdiction, and (iv) there is no Event of Default as defined
in Section 12.
 
“Additional Newbuilding Vessel(s)” shall mean any newbuilding vessel to be
acquired with proceeds from a Vessel Acquisition Loan pursuant to any
Construction Contract entered into by a Subsidiary Guarantor other than the
Capesize Vessels.
 
“Additional Secondhand Vessel(s)” shall mean any vessel acquired with proceeds
from a Vessel Acquisition Loan and which is a dry bulk carrier  (x) between
25,000 and 180,000 dwt and (y) no greater than 10 years in age upon acquisition
and no greater than 18 years in age at the Maturity Date.
 
 
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“Additional Vessel(s)” shall mean any Additional Secondhand Vessel, any
Additional Newbuilding Vessel and/or any Capesize Vessel as the context
requires.
 
“Additional Vessel Deposit” means any funds or drawings by the Borrower under
the terms of this Credit Agreement which proceeds shall be utilized to fund the
deposit or similar security to affect the acquisition of an Additional Vessel.
 
“Administrative Agent” shall have the meaning provided in the first paragraph of
this Agreement, and shall include any successor thereto.
 
“Affiliate” shall mean, with respect to any Person, any other Person (including,
for purposes of Section 11.06 only, all directors, officers and partners of such
Person) directly or indirectly controlling, controlled by, or under direct or
indirect common control with, such Person; provided, however, that for purposes
of Section 11.06, an Affiliate of the Borrower shall include any Person that
directly or indirectly owns more than 5% of any class of the capital stock of
the Borrower and any officer or director of the Borrower or any of its
Subsidiaries.  A Person shall be deemed to control another Person if such Person
possesses, directly or indirectly, the power to direct or cause the direction of
the management and policies of such other Person, whether through the ownership
of voting securities, by contract or otherwise.  Notwithstanding anything to the
contrary contained above, for purposes of Section 11.06, neither the
Administrative Agent, nor the Collateral Agent, nor the Mandated Lead Arranger
nor any Lender (or any of their respective affiliates) shall be deemed to
constitute an Affiliate of the Borrower or its Subsidiaries in connection with
the Credit Documents or its dealings or arrangements relating thereto.
 
“Agents” shall mean, collectively, the Administrative Agent, the Collateral
Agent and the Mandated Lead Arranger.
 
“Aggregate Appraised Value” shall mean at any time, the sum of the Appraised
Value of all Mortgaged Vessels owned by the Borrower and its Subsidiaries at
such time.
 
“Agreement” shall mean this Credit Agreement, as modified, supplemented, amended
or restated from time to time.
 
“Annual Fleet Maintenance Reserve Amount” shall mean, for any fiscal year, the
aggregate amount of funds budgeted by the Borrower for such fiscal year to
maintain and drydock the Borrower’s fleet during such fiscal year in order to
maintain each Mortgaged Vessel in the fleet in accordance with the provisions
contained in this Agreement and the other Credit Documents, such amount to be
approved by the Borrower’s Board of Directors acting reasonably and in good
faith.
 
“Annual Fleet Renewal Reserve Amount” shall mean, for any fiscal year, the
amount determined by the Borrower’s Board of Directors acting reasonably to be
an amount which should be reserved and/or expended during such fiscal year for
renewal capital expenditures and/or vessel acquisitions to insure the indefinite
renewal of the Borrower’s fleet, such determination to take into account, inter
alia the remaining life and prevailing asset value of the fleet.
 
 
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“Applicable Margin” shall mean 0.80% per annum until the fifth anniversary of
the Effective Date, and thereafter shall be 0.85% per annum; provided however,
that if at any time the Borrower’s Consolidated Indebtedness falls below 70% of
its Consolidated Total Capitalization, then during such period the Applicable
Margin will be 0.75% per annum until the fifth anniversary of the Effective
Date, and thereafter shall be 0.80%.
 
“Appraisal” shall mean, with respect to a Vessel, a written appraisal by an
Approved Appraiser of the fair market value of such Vessel on an individual
charter free basis.
 
“Appraised Value” of any Vessel at any time shall mean the arithmetic average of
the fair market values of such Vessel on an individual charter free basis as set
forth on the Appraisals of at least two Approved Appraisers most recently
delivered to, or obtained by, the Administrative Agent prior to such time
pursuant to Sections 7.08(iv), 8.02(g)(iv) and 10.01(c) or the definition of
Vessel Exchange.
 
 “Approved Appraiser” shall mean H. Clarksons & Company Limited, Fearnleys Ltd.,
R.S. Platou Shipbrokers a.s., ICAP Hyde & Company, Ltd., Simpson Spence & Young
Ltd. or such other independent appraisal firm as may be acceptable to the
Required Lenders.
 
“Assignment and Assumption Agreement” shall mean the Assignment and Assumption
Agreement substantially in the form of Exhibit K (appropriately completed).
 
“Assignment of Charters” shall have the meaning provided in Section 7.05.
 
“Assignment of Construction Contract” shall mean the assignment by the Borrower
or the relevant Subsidiary Guarantor of all its right, title and interest in and
to any construction contract in respect of any Additional Newbuilding Vessel and
its interest in any escrow account established in connection therewith.
 
“Assignment of Earnings” shall have the meaning provided in Section 7.05 and in
the form Exhibit H-1.
 
“Assignment of Insurances” shall have the meaning provided in Section 7.05 and
in the form Exhibit H-2.
 
“Assignment of Purchase Contract” shall mean an assignment by the relevant
Subsidiary Guarantor of all of its right, title and interest in and to the
Purchase Contract including its right to the return of the deposit made or to be
made thereunder and its interest in any escrow account established in connection
therewith.
 
“Authorized Officer” shall mean, with respect to (i) the delivery of Notices of
Borrowing, the chairman of the board, or the treasurer of the Borrower, or any
other officer of the Borrower designated in writing to the Administrative Agent
by the chief executive officer, president or treasurer of the Borrower as being
authorized to give notices under this Agreement, (ii) delivery of financial
documents and officer’s certificates pursuant to this Agreement, the chairman of
the board, the president, any vice president, the treasurer, any other financial
officer or an authorized manager of any Credit Party and (iii) any other matter
in connection with this Agreement or any other Credit Document, any officer (or
a Person or Persons so designated by
 
 
 
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any two officers) of any Credit Party, in each case to the extent reasonably
acceptable to the Administrative Agent.
 
“Available Cash” shall mean, for any period, Consolidated Net Income for such
period plus Consolidated Interest Expense for such period plus, without
duplication, the amortization of deferred finance charges and restricted stock
expenses and Non-Cash Charges for such period and the amount of all depreciation
and amortization deducted in determining Consolidated Net Income for such
period.
 
“Average Consolidated Net Indebtedness” shall mean, on any date of
determination, the average of  the Consolidated Net Indebtedness on the last
Business Day of each calendar month during the most recently ended Test Period
and on such date of determination.
 
“Bankruptcy Code” shall have the meaning provided in Section 12.05.
 
“Base Rate” shall mean, for any day, a rate of interest per annum equal to the
higher of (i) the Prime Rate for such day and (ii) the sum of the Federal Funds
Rate for such day plus ½ of 1% per annum.
 
“Borrower” shall have the meaning provided in the first paragraph of this
Agreement.
 
“Borrowing” shall mean the borrowing of Loans from all the Lenders on a given
date having the same Interest Period.
 
“Borrowing Date” shall mean each date (including the Initial Borrowing Date) on
which Loans are incurred by the Borrower or any Letters of Credit are issued for
the account of the Borrower.
 
“Business Day” shall mean any day except Saturday, Sunday and any day which
shall be in New York City, Hong Kong or London a legal holiday or a day on which
banking institutions are authorized or required by law or other government
action to close.
 
“Capesize Vessel(s)” means each of the nine (9) modern dry-bulk capesize
vessels, two such vessels having been built, completed and delivered in 2007 and
the remaining seven newbuildings to be built and estimated for delivery to the
relevant Subsidiary Guarantor between October 2007 and September 2009 by the
Seller named in the relevant Purchase Contract, each of such Vessels being
identified in Schedule IV.
 
“Capesize Vessel Deposit” means any funds or drawings by the Borrower under the
terms of this Credit Agreement which proceeds shall be utilized to fund the
deposits required under the Purchase Contracts.
 
“Capitalized Lease Obligations” of any Person shall mean all rental obligations
which, under generally accepted accounting principles, are or will be required
to be capitalized on the books of such Person, in each case taken at the amount
thereof accounted for as indebtedness in accordance with such principles.
 
 
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“Cash Equivalents” shall mean (i) securities issued or directly and fully
guaranteed or insured by the United States or any agency or instrumentality
thereof (provided that the full faith and credit of the United States is pledged
in support thereof) having maturities of not more than one year from the date of
acquisition, (ii) time deposits and certificates of deposit of any commercial
bank having, or which is the principal banking subsidiary of a bank holding
company having capital, surplus and undivided profits aggregating in excess of
$200,000,000, with maturities of not more than one year from the date of
acquisition by such Person, (iii) repurchase obligations with a term of not more
than 90 days for underlying securities of the types described in clause
(i) above entered into with any bank meeting the qualifications specified in
clause (ii) above, (iv) commercial paper issued by any Person incorporated in
the United States rated at least A-1 or the equivalent thereof by S&P or at
least P-1 or the equivalent thereof by Moody’s and in each case maturing not
more than one year after the date of acquisition by such Person, and
(v) investments in money market funds substantially all of whose assets are
comprised of securities of the types described in clauses (i) through (iv)
above.
 
“CERCLA” shall mean the Comprehensive Environmental Response, Compensation, and
Liability Act of 1980, as the same may be amended from time to time, 42 U.S.C.
§ 9601 etseq.
 
“Change of Control” shall mean (i) the Borrower shall at any time and for any
reason fail to own, directly or indirectly, 100% of the capital stock or other
equity interests of each Subsidiary Guarantor, (ii) the sale, lease or transfer
of all or substantially all of the Borrower’s assets to any Person or group (as
such term is used in Section 13(d)(3) of the Exchange Act), (iii) the
liquidation or dissolution of the Borrower, (iv) any Person or group (as such
term is used in Section 13(d)(3) of the Exchange Act), other than one or more of
the Permitted Holders, shall at any time become the owner, directly or
indirectly, beneficially or of record, of shares representing more than 30% of
the outstanding voting or economic equity interests of the Borrower, (v) the
replacement of a majority of the directors on the board of directors of the
Borrower over a two-year period from the directors who constituted the board of
directors of the Borrower at the beginning of such period, and such replacement
shall not have been approved by a vote of at least a majority of the board of
directors of the Borrower then still in office who either were members of such
board of directors at the beginning of such period or whose election as a member
of such Board of Directors was previously so approved, (vi) a “change of
control” or similar event shall occur as provided in any outstanding
Indebtedness of Borrower or any of its Subsidiaries (or the documentation
governing the same) or (vii) the Borrower’s common stock shall cease to be
traded on the New York Stock Exchange or any other internationally recognized
stock exchange.
 
“Code” shall mean the Internal Revenue Code of 1986, as amended from time to
time, and the regulations promulgated and rulings issued thereunder.  Section
references to the Code are to the Code as in effect at the date of this
Agreement and any subsequent provisions of the Code, amendatory thereof,
supplemental thereto or substituted therefore.
 
“Collateral” shall mean all property (whether real or personal) with respect to
which any security interests have been granted (or purported to be granted)
pursuant to any Security Document, including, without limitation, all Pledge
Agreement Collateral, all Earnings
 
 
 
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and Insurance Collateral, all Mortgaged Vessels, all  and all cash and Cash
Equivalents at any time delivered as collateral thereunder or as required
hereunder.
 
“Collateral Agent” shall mean the Administrative Agent acting as mortgagee,
security trustee or collateral agent for the Secured Creditors pursuant to the
Security Documents.
 
“Collateral Delivery Date” means the date which is thirty (30) days from the
Effective Date.
 
“Collateral Disposition” shall mean (i) the sale, lease, transfer or other
disposition other than pursuant to a charter by the Borrower or any of its
Subsidiaries to any Person other than the Borrower or a Subsidiary Guarantor of
any Mortgaged Vessel or (ii) any Event of Loss of any Mortgaged Vessel.
 
“Commitment” shall mean, for each Lender, the amount set forth opposite such
Lender’s name in Schedule I hereto, as same may be (x) reduced from time to time
pursuant to Sections 3.02, 3.03, 4.02 and/or 12 or (y) adjusted from time to
time as a result of assignments to or from such Lender pursuant to Section 1.12
or 15.04.
 
“Commitment Commission” shall have the meaning provided in Section 3.01(a).
 
“Consolidated EBIT” shall mean, for any period, the Consolidated Net Income for
such period, before interest expense and provision for taxes based on income and
without giving effect to any extraordinary gains or losses or gains or losses
from sales of assets other than inventory sold in the ordinary course of
business.
 
“Consolidated EBITDA” shall mean, for any period, Consolidated EBIT, adjusted by
adding thereto the amount of (i) all amortization of intangibles and
depreciation, (ii) non-cash management incentive compensation, (iii) the
amortization of fees and expenses paid in connection with the Transaction, and
(iv) any Non-Cash Charges in each case that were deducted in arriving at
Consolidated EBITDA for such period.
 
“Consolidated Indebtedness” shall mean, as at any date of determination, the
aggregate stated balance sheet amount of all Indebtedness (but including in any
event the then outstanding principal amount of all Loans, all Capitalized Lease
Obligations and all letters of credit outstanding but excluding Indebtedness of
a type described in clause (vii) of the definition thereof) of the Borrower and
its Subsidiaries on a consolidated basis as determined in accordance with GAAP;
provided that (i) Indebtedness outstanding pursuant to trade payables and
accrued expenses incurred in the ordinary course of business, and
(ii) guarantees of operating leases assigned to any of the Borrower or any
Wholly-Owned Subsidiary of the Borrower to the extent such lease is not
prohibited hereunder and such obligation does not exceed that which would
otherwise be attributed to such Person under such operating lease, shall be
excluded in determining Consolidated Indebtedness.
 
“Consolidated Interest Coverage Ratio” shall mean, for any period, the ratio of
(i) Consolidated EBITDA for such period to (ii) Consolidated Interest Expense
for such period.
 
 
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“Consolidated Interest Expense” shall mean, for any period, (i) the total
consolidated interest expense of the Borrower and its Subsidiaries for such
period (calculated without regard to any limitations on the payment thereof)
plus, without duplication, that portion of Capitalized Lease Obligations of the
Borrower and its Subsidiaries representing the interest factor for such period,
minus (ii) cash interest income of the Borrower and its Subsidiaries for such
period and the amortization of any deferred financing costs and Non-Cash Charges
incurred in connection with the Transaction to the extent otherwise included in
the calculations thereof.
 
“Consolidated Net Income” shall mean, for any period, the consolidated net after
tax income of the Borrower and its Subsidiaries for such period determined in
accordance with GAAP; provided that solely for any calculation of the “Permitted
Dividend Amount” and “Consolidated EBIT” the “Consolidated Net Income” component
of "Available Cash" shall not include any gains or losses arising from any
Interest Rate Protection Agreement and Other Hedging Agreements.
 
“Consolidated Net Indebtedness” shall mean, as at any date of determination, the
remainder of (i) the Consolidated Indebtedness on such date minus (ii) the
aggregate amount of Unrestricted cash and Cash Equivalents of the Borrower and
its Subsidiaries on such date.
 
“Consolidated Net Worth” shall mean the Net Worth of the Borrower and its
Subsidiaries determined on a consolidated basis in accordance with GAAP after
appropriate deduction for any minority interests in Subsidiaries.
 
“Consolidated Total Capitalization” shall mean, at any time of determination,
the sum of Consolidated Indebtedness at such time and Consolidated Net Worth at
such time.
 
“Contingent Obligation” shall mean, as to any Person, any obligation of such
Person guaranteeing or intended to guarantee any Indebtedness, leases, dividends
or other obligations (“primary obligations”) of any other Person (the “primary
obligor”) in any manner, whether directly or indirectly, including, without
limitation, any obligation of such Person, whether or not contingent, (i) to
purchase any such primary obligation or any property constituting direct or
indirect security therefore, (ii) to advance or supply funds (x) for the
purchase or payment of any such primary obligation or (y) to maintain working
capital or equity capital of the primary obligor or otherwise to maintain the
net worth or solvency of the primary obligor, (iii) to purchase property,
securities or services primarily for the purpose of assuring the owner of any
such primary obligation of the ability of the primary obligor to make payment of
such primary obligation or (iv) otherwise to assure or hold harmless the holder
of such primary obligation against loss in respect thereof; provided, however,
that the term Contingent Obligation shall not include endorsements of
instruments for deposit or collection in the ordinary course of business and any
products warranties extended in the ordinary course of business.  The amount of
any Contingent Obligation shall be deemed to be an amount equal to the stated or
determinable amount of the primary obligation in respect of which such
Contingent Obligation is made (or, if the less, the maximum amount of such
primary obligation for which such Person may be liable pursuant to the terms of
the instrument evidencing such Contingent Obligation) or, if not stated or
determinable, the maximum reasonably anticipated liability in respect thereof
(assuming such Person is required to perform thereunder) as determined by such
Person in good faith.
 
 
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“Credit Documents” shall mean this Agreement, each Note, each Security Document,
the Guaranty and, after the execution and delivery thereof, each additional
guaranty or additional security document executed pursuant to Section 10.11.
 
“Credit Event” shall have the meaning provided in Section 8.01.
 
“Credit Party” shall mean the Borrower, each Subsidiary Guarantor, and any other
Subsidiary of the Borrower which at any time executes and delivers any Credit
Document.
 
“Default” shall mean any event, act or condition which with notice or lapse of
time, or both, would constitute an Event of Default.
 
“Defaulting Lender” shall mean any Lender with respect to which a Lender Default
is in effect.
 
“Dividend” with respect to any Person shall mean that such Person has declared
or paid a dividend or returned any equity capital to its stockholders, partners
or members or authorized or made any other distribution, payment or delivery of
property (other than common stock or the right to purchase any of such stock of
such Person) or cash to its stockholders, partners or members as such, or
redeemed, retired, purchased or otherwise acquired, directly or indirectly, for
a consideration any shares of any class of its capital stock or partnership or
membership interests outstanding on or after the Effective Date (or any options
or warrants issued by such Person with respect to its capital stock), or set
aside any funds for any of the foregoing purposes, or shall have permitted any
of its Subsidiaries to purchase or otherwise acquire for a consideration any
shares of any class of the capital stock of, or equity interests in, such Person
outstanding on or after the Effective Date (or any options or warrants issued by
such Person with respect to its capital stock or other equity
interests).  Without limiting the foregoing, “Dividends” with respect to any
Person shall also include all payments made or required to be made by such
Person with respect to any stock appreciation rights, plans, equity incentive or
achievement plans or any similar plans or setting aside of any funds for the
foregoing purposes.
 
“DOC” means a document of compliance issued to an Operator in accordance with
Rule 13 of the ISM Code.
 
“Dollars” and the sign “$” shall each mean lawful money of the United States.
 
“Drawing” has the meaning provided in Section 2.04(b).
 
“Earnings and Insurance Collateral” shall mean all “Earnings Collateral” and
“Insurance Collateral”, as the case may be, as defined in the respective
Assignment of Earnings and the Assignment of Insurances.
 
“Effective Date” shall have the meaning provided in Section 15.10.
 
“Eligible Transferee” shall mean and include a commercial bank, insurance
company, financial institution, fund or other Person which regularly purchases
interests in loans or extensions of credit of the types made pursuant to this
Agreement, any other Person which would constitute a “qualified institutional
buyer” within the meaning of Rule 144A under the
 
 
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Securities Act as in effect on the Effective Date or other “accredited investor”
(as defined in Regulation D of the Securities Act).
 
“Environmental Claims” shall mean any and all administrative, regulatory or
judicial actions, suits, demands, demand letters, directives, claims, liens,
notices of noncompliance or violation, investigations or proceedings relating in
any way to any Environmental Law or any permit issued, or any approval given,
under any such Environmental Law (hereafter, “Claims”), including, without
limitation, (a) any and all Claims by governmental or regulatory authorities for
enforcement, cleanup, removal, response, remedial or other actions or damages
pursuant to any applicable Environmental Law, and (b) any and all Claims by any
third party seeking damages, contribution, indemnification, cost recovery,
compensation or injunctive relief in connection with alleged injury or threat of
injury to health, safety or the environment due to the presence of Hazardous
Materials.
 
“Environmental Law” shall mean any applicable Federal, state, foreign or local
statute, law, rule, regulation, ordinance, code, binding and enforceable
guideline, binding and enforceable written policy and rule of common law now or
hereafter in effect and in each case as amended, and any judicial or
administrative interpretation thereof, including any judicial or administrative
order, consent decree or judgment, to the extent binding on the Borrower or any
of its Subsidiaries, relating to the environment, and/or Hazardous Materials,
including, without limitation, CERCLA; OPA; the Federal Water Pollution Control
Act, 33 U.S.C. § 1251 etseq.; the Hazardous Material Transportation Act, 49
U.S.C. § 1801 etseq.; the Occupational Safety and Health Act, 29 U.S.C. § 651
etseq. (to the extent it regulates occupational exposure to Hazardous
Materials); and any state and local or foreign counterparts or equivalents, in
each case as amended from time to time.
 
“Environmental Release” shall mean any spilling, leaking, pumping, pouring,
emitting, emptying, discharging, injecting, escaping, leaching, dumping,
disposing or migration into the environment.
 
“Equity Interests” of any Person means any and all shares, interests, rights to
purchase, warrants, options, participations or other equivalents of or interests
in (however designated) equity of such Person, including any preferred stock,
any limited or general partnership interest and any limited liability company
membership interest.
 
“ERISA” shall mean the Employee Retirement Income Security Act of 1974, as
amended from time to time, and the regulations promulgated and rulings issued
thereunder.  Section references to ERISA are to ERISA, as in effect at the date
of this Agreement and any subsequent provisions of ERISA, amendatory thereof,
supplemental thereto or substituted therefore.
 
“ERISA Affiliate” shall mean each person (as defined in Section 3(9) of ERISA)
which together with the Borrower or a Subsidiary of the Borrower would be deemed
to be a “single employer” within the meaning of Section 414(b), (c), (m) or (o)
of the Code.
 
“Event of Default” shall have the meaning provided in Section 12.
 
 
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“Event of Loss” shall mean any of the following events:  (x) the actual or
constructive total loss of a Vessel or the agreed or compromised total loss of a
Vessel; or (y) the capture, condemnation, confiscation, requisition, purchase,
seizure or forfeiture of, or any taking of title to, a Vessel.  An Event of Loss
shall be deemed to have occurred:  (i) in the event of an actual loss of a
Vessel, at the time and on the date of such loss or if that is not known at noon
Greenwich Mean Time on the date which such Vessel was last heard from; (ii) in
the event of damage which results in a constructive or compromised or arranged
total loss of a Vessel, at the time and on the date of the event giving rise to
such damage; or (iii) in the case of an event referred to in clause (y) above,
at the time and on the date on which such event is expressed to take effect by
the Person making the same.  Notwithstanding the foregoing, if such Vessel shall
have been returned to any Credit Party following any event referred to in clause
(y) above prior to the date upon which a mandatory repayment of the Loans is
required to be made under Section 4.02 hereof, no Event of Loss shall be deemed
to have occurred by reason of such event.
 
“Exchange Act” shall mean the Securities Exchange Act of 1934.
 
“Existing Credit Agreement” shall have the same meaning ascribed thereto in the
second Recital.
 
“Existing Indebtedness” shall have the meaning provided in Section 9.19.
 
“Existing Vessel(s)” means those vessels already existing and owned by either
the Borrower or a Subsidiary Guarantor and identified on Schedule III.
 
“Facility Amount” shall mean the amount of the credit facility granted by the
Lenders to the Borrower pursuant to this Credit Agreement available to the
Borrower from time to time pursuant to the terms hereof in principal amount at
no time to exceed One Billion Three Hundred Seventy Seven Million United States
Dollars (US$1,377,000,000).
 
“Facing Fee” shall have the meaning provided in Section 3.01(c).
 
“Federal Funds Rate” shall mean, for any day, an interest rate per annum equal
to the weighted average of the rates on overnight Federal funds transactions
with members of the Federal Reserve System arranged by Federal funds brokers on
such day, as published for such day (or, if such day is not a Business Day, for
the immediately preceding Business Day) by the Federal Reserve Bank of New York,
or, if such rate is not so published for any day which is a Business Day, the
average of the quotations at approximately 11:00 A.M. (New York time) on such
day on such transactions received by the Administrative Agent from three Federal
funds brokers of recognized standing selected by the Administrative Agent in its
sole discretion.
 
“Fee Letter” shall mean the mandate letter dated July 20, 2007 entered into by
and between the Borrower and the Mandated Lead Arranger in respect of the fees
to be paid by the Borrower.
 
“Final Payment” means the amount equal to the sum of (i) thirty percent (30%) of
the Facility Amount plus (ii) the amount which is necessary to repay accrued but
unpaid interest and (iii) any other amounts owing by the Borrower to the Lenders
necessary to reduce the Total
 
 
 
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Commitment to zero on the Maturity Date pursuant to this Agreement or any
Security Document.
 
“Flag Jurisdiction Transfer” shall mean the transfer of the registration and
flag of a Mortgaged Vessel from one Acceptable Flag Jurisdiction to another
Acceptable Flag Jurisdiction, provided that the following conditions are
satisfied with respect to such transfer:
 
(i)  On each Flag Jurisdiction Transfer Date, the Credit Party which is
consummating a Flag Jurisdiction Transfer on such date shall have duly
authorized, executed and delivered, and caused to be recorded in the appropriate
vessel registry a Vessel Mortgage with respect to the Mortgaged Vessel being
transferred (the “Transferred Vessel”) and such Vessel Mortgage shall be
effective to create in favor of the Collateral Agent and/or the Lenders a legal,
valid and enforceable first priority security interest, in and lien upon such
Transferred Vessel, subject only to Permitted Liens.  All filings, deliveries of
instruments and other actions necessary or desirable in the reasonable opinion
of the Collateral Agent to perfect and preserve such security interests shall
have been duly effected and the Collateral Agent shall have received evidence
thereof in form and substance reasonably satisfactory to the Collateral Agent.
 
(ii)  On each Flag Jurisdiction Transfer Date, the Administrative Agent shall
have received from counsel to the Credit Parties consummating the relevant Flag
Jurisdiction Transfer reasonably satisfactory to the Administrative Agent
practicing in those jurisdictions in which the Transferred Vessel is registered
and/or the Credit Party owning such Transferred Vessel is organized, opinions
which shall be addressed to the Administrative Agent and each of the Lenders and
dated such Flag Jurisdiction Transfer Date, which shall (x) be in form and
substance reasonably acceptable to the Administrative Agent and (y) cover the
perfection of the security interests granted pursuant to the Vessel Mortgage(s)
and such other matters incident thereto as the Administrative Agent may
reasonably request.
 
(iii)  On each Flag Jurisdiction Transfer Date:
 
(A)  The Administrative Agent shall have received (x) certificates of ownership
from appropriate authorities showing (or confirmation updating previously
reviewed certificates and indicating) the registered ownership of the
Transferred Vessel transferred on such date by the relevant Subsidiary Guarantor
and (y) the results of maritime registry searches with respect to the
Transferred Vessel transferred on such date, indicating no record liens other
than Liens in favor of the Collateral Agent and/or the Lenders and Permitted
Liens; and
 
(B)  The Administrative Agent shall have received a report, in form and scope
reasonably satisfactory to the Administrative Agent, from a firm of independent
marine insurance brokers reasonably acceptable to the Administrative Agent with
respect to the insurance maintained by the Credit Party in respect of the
Transferred Vessel transferred on such date, together with a certificate from
such broker certifying that such insurances (i) are placed with such insurance
companies and/or underwriters and/or clubs, in such amounts, against such risks,
and in such form, as are customarily insured against by
 
 
 
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similarly situated insureds for the protection of the Administrative Agent
and/or the Lenders as mortgagee and (ii) conform with the insurance requirements
of the respective Vessel Mortgages.
 
(iv)  On or prior to each Flag Jurisdiction Transfer Date, the Administrative
Agent shall have received a certificate, dated the Flag Jurisdiction Transfer
Date, signed by an Authorized Officer, member or general partner of the Credit
Party consummating such Flag Jurisdiction Transfer, certifying that (A) all
necessary governmental (domestic and foreign) and third party approvals and/or
consents in connection with the Flag Jurisdiction Transfer being consummated on
such date and otherwise referred to herein shall have been obtained and remain
in effect, (B) there exists no judgment, order, injunction or other restraint
prohibiting or imposing materially adverse conditions upon such Flag
Jurisdiction Transfer or the other transactions contemplated by this Agreement
and (C) copies of resolutions approving the Flag Jurisdiction Transfer of such
Credit Party and any other matters the Administrative Agent may reasonably
request.
 
(v)  On each Flag Jurisdiction Transfer Date, the Administrative Agent shall
have received such other agreements, documents and certificates as it shall have
reasonably requested.
 
“Flag Jurisdiction Transfer Date” shall mean the date on which a Flag
Jurisdiction Transfer occurs.
 
“Fleet Maintenance Reserve” shall mean for a fiscal quarter one quarter of the
Annual Fleet Maintenance Reserve Amount for the fiscal year in which such fiscal
quarter occurs.
 
“Fleet Renewal Reserve” shall mean for a fiscal quarter one quarter of the
Annual Fleet Reserve Renewal Amount for the fiscal year in which such fiscal
quarter occurs.
 
“Foreign Pension Plan” shall mean any plan, fund (including, without limitation,
any superannuation fund) or other similar program established or maintained
outside the United States of America by the Borrower or any one or more of its
Subsidiaries primarily for the benefit of employees of the Borrower or such
Subsidiaries residing outside the United States of America, which plan, fund or
other similar program provides, or results in, retirement income, a deferral of
income in contemplation of retirement or payments to be made upon termination of
employment, and which plan is not subject to ERISA or the Code.
 
 “GAAP” shall have the meaning provided in Section 15.07(a).
 
“Guaranty” shall have the meaning provided in Section 5.06.
 
“Hazardous Materials” shall mean: (a) any petroleum or petroleum products,
radioactive materials, asbestos in any form that is or could become friable,
urea formaldehyde foam insulation, transformers or other equipment that contain
dielectric fluid containing levels of polychlorinated biphenyls, and radon gas;
(b) any chemicals, materials or substances defined as or included in the
definition of “hazardous substances,” “hazardous waste,” “hazardous materials,”
“extremely hazardous substances,” “restricted hazardous waste,” “toxic
substances,”
 
 
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“toxic pollutants,” “contaminants,” or “pollutants,” or words of similar import,
under any applicable Environmental Law; and (c) any other chemical, material or
substance, exposure to which is prohibited, limited or regulated by any
governmental authority under Environmental Laws.
 
“Indebtedness” shall mean, as to any Person, without duplication, (i) all
indebtedness (including principal, interest, fees and charges) of such Person
for borrowed money or for the deferred purchase price of property or services,
(ii) the maximum amount available to be drawn under all letters of credit
(including Letters of Credit) issued for the account of such Person and all
unpaid drawings (including Unpaid Drawings) in respect of such letters of
credit, (iii) all Indebtedness of the types described in clause (i), (ii), (iv),
(v), (vi) or (vii) of this definition secured by any Lien on any property owned
by such Person, whether or not such Indebtedness has been assumed by such Person
(to the extent of the value of the respective property), (iv) the aggregate
amount required to be capitalized under leases under which such Person is the
lessee, (v) all obligations of such person to pay a specified purchase price for
goods or services, whether or not delivered or accepted, i.e., take-or-pay and
similar obligations, (vi) all Contingent Obligations of such Person and
(vii) all obligations under any Interest Rate Protection Agreement or Other
Hedging Agreement or under any similar type of agreement; provided that
Indebtedness shall in any event not include trade payables and expenses accrued
in the ordinary course of business.
 
“Initial Borrowing Date” shall mean the date occurring on or after the Effective
Date on which the initial Borrowing of Loans hereunder occurs.
 
“Interest Determination Date” shall mean, with respect to any Loan, the second
Business Day prior to the commencement of any Interest Period relating to such
Loan.
 
“Interest Period” shall have the meaning provided in Section 1.08.
 
“Interest Rate Protection Agreement” shall mean any interest rate swap
agreement, interest rate cap agreement, interest collar agreement, interest rate
hedging agreement, interest rate floor agreement or other similar agreement or
arrangement.
 
“Investments” shall have the meaning provided in Section 11.05.
 
“ISM Code” means the International Safety Management Code for the Safe Operating
of Ships and for Pollution Prevention constituted pursuant to Resolution A.
741(18) of the International Maritime Organization and incorporated into the
Safety of Life at Sea Convention and includes any amendments or extensions
thereto and any regulation issued pursuant thereto.
 
“ISPS Code” means the International Ship and Port Facility Code adopted by the
International Maritime Organization at a conference in December 2002 and
amending the Safety of Life at Sea Convention and includes any amendments or
extensions thereto and any regulation issued pursuant thereto
 
“Issuing Lender” shall mean the Administrative Agent and any Lender (which, for
purposes of this definition, also shall include any banking affiliate of any
Lender which has
 
 
 
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agreed to issue Letters of Credit under this Agreement) which at the request of
the Borrower and with the consent of the Administrative Agent (which consent
shall not be unreasonably withheld) agrees, in such Lender’s sole discretion, to
become an Issuing Lender for the purpose of issuing Letters of Credit pursuant
to Section 2.01.
 
“Jinhui” means Jinhui Shipping and Transportation Limited a company limited by
shares formed under the laws of Bermuda and whose capital stock is listed on the
Oslo Stock Exchange.
 
“Jinhui Pledge” shall mean that certain Pledge of all shares in Jinhui owned by
the Borrower to be executed pursuant to Section 7.04 in form and substance
acceptable to the Administrative Agent.
 
 “Leaseholds” of any Person means all the right, title and interest of such
Person as lessee or licensee in, to and under leases or licenses of land,
improvements and/or fixtures.
 
“Lender” shall mean each financial institution listed on Schedule I, as well as
any Person which becomes a “Lender” hereunder pursuant to 15.04(b).
 
“Lender Default” shall mean (i) the refusal (which has not been retracted) or
other failure (which has not been cured) of a Lender to make available its
portion of any Borrowing required to be made in accordance with the terms of
this Agreement as then in effect or (ii) a Lender having notified in writing the
Borrower and/or the Administrative Agent that it does not intend to comply with
its obligations under Section 1.01 or Section 2.03.
 
“Letter of Credit” shall have the meaning provided in Section 2.01(a).
 
“Letter of Credit Fee” shall have the meaning provided in Section 3.01(b).
 
“Letter of Credit Outstandings” shall mean, at any time, the sum of (i) the
aggregate Stated Amount of all outstanding Letters of Credit and (ii) the amount
of all Unpaid Drawings.
 
“Letter of Credit Request” shall have the meaning provided in Section 2.02(a).
 
“Leverage Ratio” shall mean, at any date of determination, the ratio of Average
Consolidated Net Indebtedness on such date of determination to Consolidated
EBITDA for the most recently ended Test Period.
 
“LIBOR” shall mean (a) the rate (rounded upward to the nearest 1/16th of one
percent) for deposits of Dollars for a period equivalent to the relevant
Interest Period at or about 11:00 AM (London time) on the second London Business
Day before the first day of such period as displayed on Telerate page 3750
(British Bankers’ Association Interest Settlement Rates)(or such other page as
may replace such page 3750 on such system or on any other system of the
information vendor for the time being designated by the British Bankers’
Association to calculate BBA Interest Settlement (as defined in the British
Bankers’ Association’s Recommended Terms and Conditions (“BBAIRS” terms) dated
August 1985)), provided that if on such date no such rate is so displayed for
the relevant Interest Period, LIBOR for such period
 
 
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shall be the arithmetic mean (rounded upward to four decimal places) of the
rates respectively quoted to the Administrative Agent by a Lender at the request
of the Administrative Agent as the offered rate for deposits of Dollars in an
amount approximately equal to the amount in relation to which LIBOR is to be
determined for a period equivalent to the relevant Interest Period to prime
banks in the London Interbank Market at or about 11:00 a.m. (London time) on the
second Banking Day before the first day of such period divided by (b) a number
equal to 1.00 minus the LIBOR Rate Reserve Percentage.
 
“LIBOR Rate Reserve Percentage” means, for any day, the maximum percentage
(expressed as a decimal) specified from time to time by the Board of Governors
of the Federal Reserve System (or any successor) for determining the maximum
reserve requirements (including, but not limited to supplemental, marginal or
emergency reserves) with respect to eurocurrency funding or a member bank in
such system or a similar requirement of the applicable regulatory agency having
jurisdiction over the Lender.
 
“Lien” shall mean any mortgage, pledge, hypothecation, assignment, deposit
arrangement, encumbrance, lien (statutory or other), preference, priority or
other security agreement of any kind or nature whatsoever (including, without
limitation, any conditional sale or other title retention agreement, any
financing or similar statement or notice filed under the UCC or any other
similar recording or notice statute, and any lease having substantially the same
effect as any of the foregoing).
 
“Loan” shall have the meaning provided in Section 1.01.
 
“Management Agreements” shall have the meaning provided in Section 7.09.
 
“Mandated Lead Arranger” shall have the meaning provided in the first paragraph
of the Recital of this Agreement.
 
“Margin Stock” shall have the meaning provided in Regulation U.
 
“Material Adverse Effect” shall mean a material adverse effect on the
(i) Transaction, (ii) business, property, assets, liabilities, condition
(financial or otherwise), operations or prospects (x) of the Mortgaged Vessels
or (y) the Borrower and the Subsidiary Guarantors taken as a whole, (iii) the
rights and remedies of the Administrative Agent or the Lenders or (iv) the
ability of any Credit Party to perform its obligations under the Credit
Documents to which it is a party.
 
“Maturity Date” shall mean the tenth anniversary of the Effective Date.
 
“Memorandum of Agreement” means any memorandum of agreement and ancillary
documents evidencing any agreement between the Borrower or respective Subsidiary
Guarantor and any Seller so named in the agreement for the purchase of an
Additional Vessel.
 
“Minimum Borrowing Amount” shall mean US$5,000,000 with any additional drawings
in increments of US$ 1,000,000.
 
 
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“Minimum Consolidated Net Worth” shall mean not less than US$263,300,000 plus
80% of the Net Proceeds received as a result of any new equity issues by the
Borrower from and after June 30, 2007.
 
“Moody’s” shall mean Moody’s Investors Service, Inc. and its successors.
 
“Mortgaged Vessels” shall mean, collectively, all Existing Vessels and each
Additional Vessel acquired by the Borrower or a Subsidiary Guarantor and
mortgaged to the Collateral Agent hereunder and individually, any of such
vessels.
 
“Multiemployer Plan” shall mean a Plan which is defined in Section 3(37) of
ERISA.
 
“NAIC” shall mean the National Association of Insurance Commissioners (and its
successors from time to time).
 
“Net Cash Flow” means the net change in cash for each fiscal quarter after
taking into consideration the net change in operating activities, investment
activities and financing activities in the Borrower’s consolidated statement of
cash flows.
 
“Net Worth” shall mean, as to any Person, the sum of its capital stock, capital
in excess of par or stated value of shares of its capital stock, retained
earnings and any other account which, in accordance with GAAP, constitutes
stockholders’ equity, but excluding any treasury stock.
 
“Non-Cash Charges” means the unamortized charges incurred by the Borrower
associated with the Existing Credit Facility and Revolving Credit Facility that
is charged to expense due to the refinancing of the aforementioned.
 
“Note” shall have the meaning provided in Section 1.05(a).
 
“Notice of Borrowing” shall have the meaning provided in Section 1.03(a).
 
“Notice Office” shall mean the office of the Administrative Agent located at 200
Park Avenue, 31st Floor, New York, NY 10166-0396, or such other office as the
Administrative Agent may hereafter designate in writing as such to the other
parties hereto.
 
“Obligations” shall mean all amounts owing to the Administrative Agent, the
Collateral Agent, each Issuing Lender or any Lender pursuant to the terms of
this Agreement or any other Credit Document.
 
“OPA” shall mean the Oil Pollution Act of 1990, as amended, 33 U.S.C. § 2701
etseq.
 
“Operating Account” shall mean all of the Borrower’s and Subsidiary Guarantor’s
deposit accounts maintained with Nordea Bank Finland PLC, New York Branch or any
other financial institution reasonably acceptable to the Administrative Agent.
 
 
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“Other Hedging Agreement” shall mean any foreign exchange contracts, currency
swap agreements, commodity agreements, forward freight agreements or other
similar agreements or arrangements designed to protect against the fluctuations
in currency or commodity values.
 
“Participant” shall have the meaning provided in Section 2.03(a).
 
“PATRIOT Act” shall have the meaning provided in Section 15.21.
 
“Payment Date” shall mean the first Business Day of each April, July, October
and January, commencing with October 2007 and through, and including, the
Maturity Date.
 
“Payment Office” shall mean the office of the Administrative Agent located at
200 Park Avenue, 31st Floor, New York, NY 10166-0396, or such other office as
the Administrative Agent may hereafter designate in writing as such to the other
parties hereto.
 
“PBGC” shall mean the Pension Benefit Guaranty Corporation established pursuant
to Section 4002 of ERISA, or any successor thereto.
 
“Percentage” of any Lender at any time shall mean a fraction (expressed as a
percentage) the numerator of which is the Commitment of such Lender at such time
and the denominator of which is the Total Commitment at such time, provided that
if the Percentage of any Lender is to be determined after the Total Commitment
has been terminated, then the Percentages of the Lenders shall be determined
immediately prior (and without giving effect) to such termination.
 
“Permitted Dividend Amount” shall mean, for each fiscal quarter of the Borrower,
(i) the sum of (x) Available Cash for such fiscal quarter and (y) the Permitted
Dividend Carry Forward Amount for the immediately preceding fiscal quarter minus
(ii) the sum of (a) the Fleet Maintenance Reserve for such fiscal quarter (b)
the Fleet Renewal Reserve for such fiscal quarter, and (c) Consolidated Interest
Expense for such fiscal quarter; providedthat the aggregate amount of all
Dividends made pursuant to sub-clause (y) and Section 11.03(ii) (after giving
effect to such carry forward) shall not exceed US$150,000,000.
 
“Permitted Dividend Carry Forward Amount” shall mean (i) for the fiscal quarter
ending June 30, 2005, zero, and (ii) for each fiscal quarter thereafter, the
Permitted Dividend Amount for such fiscal quarter; provided that to the extent
the Permitted Dividend Amount for any fiscal quarter is a positive amount, only
the portion of the Permitted Dividend Amount that has not been distributed as a
Dividend pursuant to Section 9.03(ii) shall be included in the calculation of
this clause (ii).
 
“Permitted Encumbrance” shall mean easements, rights-of-way, restrictions,
encroachments, exceptions to title and other similar charges or encumbrances on
any Mortgaged Vessel or any other property of the Borrower or any of its
Subsidiaries arising in the ordinary course of business which do not materially
detract from the value of such Mortgaged Vessel or the property subject thereto.
 
 
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“Permitted Holders” shall mean (i) Peter Georgiopoulos (including his immediate
family members and trusts for his benefit and/or for the benefit of his
immediate family members) and any corporation or other entity directly or
indirectly controlled by Peter Georgiopoulos and (ii) Oaktree Capital
Management, LLC and any corporation or other entity directly or indirectly
controlled by Oaktree Capital Management, LLC.
 
“Permitted Liens” shall have the meaning provided in Section 11.01.
 
“Person” shall mean any individual, partnership, joint venture, firm,
corporation, association, trust or other enterprise or any government or
political subdivision or any agency, department or instrumentality thereof.
 
“Plan” shall mean any pension plan as defined in Section 3(2) of ERISA, which is
maintained or contributed to by (or to which there is an obligation to
contribute of) the Borrower or a Subsidiary of the Borrower or any ERISA
Affiliate, and each such plan for the five-year period immediately following the
latest date on which the Borrower, or a Subsidiary of the Borrower or any ERISA
Affiliate maintained, contributed to or had an obligation to contribute to such
plan.
 
“Pledge Agreement” shall have the meaning provided in Section 5.07.
 
“Pledge Agreement Collateral” shall mean all “Collateral” as defined in the
Pledge Agreements.
 
“Pledged Securities” shall mean “Securities” as defined in the Pledge Agreements
pledged (or required to be pledged) pursuant thereto.
 
“Pre-Delivery Installment” means any installment required to be made by a
Subsidiary Guarantor under a construction contract for an Additional Newbuilding
Vessel.
 
“Prime Rate” shall mean the rate which the Administrative Agent announces from
time to time as its prime lending rate, the Prime Rate to change when and as
such prime lending rate changes.  The Prime Rate is a reference rate and does
not necessarily represent the lowest or best rate actually charged to any
customer. The Administrative Agent may make commercial loans or other loans at
rates of interest at, above or below the Prime Rate.
 
“Purchase Contract” means one or more of the Memoranda of Agreement entered into
on July 18, 2007 in respect of the Capesize Vessels.
 
“Real Property” of any Person shall mean all the right, title and interest of
such Person in and to land, improvements and fixtures, including Leaseholds.
 
“Refinancing Loan” means the Loan to be borrowed in order to refinance all
outstanding indebtedness under the Existing Credit Facility and the Revolving
Credit Facility.
 
“Register” shall have the meaning provided in Section 15.17.
 
 
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“Regulation D” shall mean Regulation D of the Board of Governors of the Federal
Reserve System as from time to time in effect and any successor to all or a
portion thereof establishing reserve requirements.
 
“Regulation T” shall mean Regulation T of the Board of Governors of the Federal
Reserve System as from time to time in effect and any successor to all or a
portion thereof.
 
“Regulation U” shall mean Regulation U of the Board of Governors of the Federal
Reserve System as from time to time in effect and any successor to all or a
portion thereof.
 
“Regulation X” shall mean Regulation X of the Board of Governors of the Federal
Reserve System as from time to time in effect and any successor to all or a
portion thereof.
 
“Replaced Lender” shall have the meaning provided in Section 1.12.
 
“Replacement Lender” shall have the meaning provided in Section 1.12.
 
“Reportable Event” shall mean an event described in Section 4043(c) of ERISA
with respect to a Plan that is subject to Title IV of ERISA other than those
events as to which the 30-day notice period is waived under subsection .22, .23,
.25, .27 or .28 of PBGC Regulation Section 4043.
 
“Required Lenders” shall mean Lenders the sum of whose outstanding Commitments
(or after the termination thereof, outstanding Loans and Percentage of Letter of
Credit Outstanding) at such time represent 50% of the Total Commitments at such
time (or, after termination thereof, the then principal amount of all
outstanding Loans and all Letter of Credit Outstandings at such time); provided
that in the event the Mandated Lead Arrangers have Commitments, in the
aggregate, constituting 50% or more of the Total Commitments, the Required
Lenders shall mean Lenders, the sum of whose outstanding Commitments (or after
the termination thereof, outstanding Loans and Percentages of Letters of Credit
Outstanding) at such time represent 66-2/3% of the Total Commitment (or after
the termination thereof, outstanding Loans and Percentages of Letters of Credit
Outstanding).
 
“Restricted” shall mean, when referring to cash or Cash Equivalents of the
Borrower or any of its Subsidiaries, that such cash or Cash Equivalents (i)
appears (or would be required to appear) as “restricted” on a consolidated
balance sheet of the Borrower or of any such Subsidiary (unless such appearance
is related to the Credit Documents or Liens created thereunder), (ii) are
subject to any Lien in favor of any Person other than the Collateral Agent for
the benefit of the Secured Creditors or (iii) are not otherwise generally
available for use by the Borrower or such Subsidiary.
 
“Returns” shall have the meaning provided in Section 9.09.
 
“Revolving Credit Agreement” shall have the meaning ascribed thereto in the
third Recital.
 
 
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“S&P” shall mean Standard & Poor’s Rating Services, a division of the
McGraw-Hill Companies, Inc., and its successors.
 
“Secured Creditors” shall mean the “Secured Creditors” as defined in the
Security Documents.
 
“Securities Act” shall mean the Securities Act of 1933, as amended.
 
“Security Documents” shall mean the Vessel Acquisition Document Assignment, each
Pledge Agreement, each Assignment of Earnings, each Assignment of Insurances,
each Assignment of Charters, each Vessel Mortgage, each Assignment of Purchase
Contract and, after the execution and delivery thereof, each additional security
document executed pursuant to Section 10.11.
 
“Service Agreements” shall have the meaning provided in Section 7.09.
 
“Shareholder Rights Agreement” shall mean the Shareholders Rights Agreement
entered into as of March 1, 2007 by and between the Borrower and Mellon Investor
Services LLC, a New Jersey limited liability company, as Rights Agent without
giving effect to any amendments, modifications or supplements thereto.
 
“SMC” means a safety management certificate issued in respect of the Collateral
Rigs in accordance with Rule 13 of the ISM Code.
 
“Stated Amount” of each Letter of Credit shall, at any time, mean the maximum
amount available to be drawn thereunder (in each case determined without regard
to whether any conditions to drawing could then be met).
 
“Subsidiary” shall mean, as to any Person, (i) any corporation more than 50% of
whose stock of any class or classes having by the terms thereof ordinary voting
power to elect a majority of the directors of such corporation (irrespective of
whether or not at the time stock of any class or classes of such corporation
shall have or might have voting power by reason of the happening of any
contingency) is at the time owned by such Person and/or one or more Subsidiaries
of such Person and (ii) any partnership, limited liability company, association,
joint venture or other entity in which such Person and/or one or more
Subsidiaries of such Person has more than a 50% equity interest at the time.
 
“Subsidiary Guarantor” shall mean each direct and indirect Subsidiary of the
Borrower which is party to the Guaranty, or which executes a counterpart thereof
after the Effective Date.
 
“Tax Benefit” shall have the meaning provided in Section 4.04(c).
 
“Taxes” shall have the meaning provided in Section 4.04(a).
 
“Test Period” shall mean each period of four consecutive fiscal quarters then
last ended, in each case taken as one accounting period, provided that in the
case of any first quarter ending prior to December 31, 2007, the “Test Period”
shall be the period commencing on January 1, 2007 and ending on the last day of
such fiscal quarter.
 
 
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“Total Commitment” shall mean, at any time, the sum of the Commitments of each
of the Lenders at such time.
 
“Total Facility Amount” has the meaning provided in the fifth (5th) recital
paragraph.“Transaction” shall mean, collectively, (i)  the entering into of the
Credit Documents and the incurrence of Loans hereunder, and (ii) the payment of
all fees and expenses in connection with the foregoing.
 
“Transferred Vessel” shall have the meaning provided in the definition of “Flag
Jurisdiction Transfer” in this Section 11.
 
“UCC” shall mean the Uniform Commercial Code as from time to time in effect in
the relevant jurisdiction.
 
“Unfunded Current Liability” of any Plan shall mean the amount, if any, by which
the value of the accumulated plan benefits under the Plan determined on a plan
termination basis in accordance with actuarial assumptions at such time
consistent with those prescribed by the PBGC for purposes of Section 4044 of
ERISA, exceeds the fair market value of all plan assets allocable to such
liabilities under Title IV of ERISA (excluding any accrued but unpaid
contributions).
 
“United States” and “U.S.” shall each mean the United States of America.
 
“Unpaid Drawing” shall have the meaning provided in Section 2.04(a).
 
“Unrestricted” shall mean, when referring to cash or Cash Equivalents of the
Borrower or any of its Subsidiaries, that such cash or Cash Equivalents are not
Restricted.
 
“Unutilized Commitment” shall mean, with respect to any Lender, at any time, an
amount equal to (i) such Lender’s Commitment at such time, less (ii) the sum of
the aggregate principal amount of Loans made by such Lender then outstanding and
such Lender’s Percentage of Letter of Credit Outstandings at such time.
 
“Vessel” shall mean sea going vessels and tankers.
 
“Vessel Acquisition” shall mean the acquisition of any Additional Vessel.
 
“Vessel Acquisition Borrowing Date” shall have the meaning provided in Section
6.02(a).
 
“Vessel Acquisition Loan” shall mean any Loans to the Borrower pursuant to this
Credit Agreement the proceeds of which shall be utilized to fund the acquisition
of Additional Vessels; provided that any proceeds utilized to fund the Capesize
Deposit shall not be considered a Vessel Acquisition Loan within the meaning of
this term.
 
 
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“Vessel Exchange” shall mean the exchange of a Mortgaged Vessel for a Vessel
which Vessel shall constitute an Acceptable Replacement Vessel and provided that
the following conditions are satisfied with respect to such exchange:
 
(i)  On each Vessel Exchange Date, if the Subsidiary owning the Acceptable
Replacement Vessel is not a Credit Party, (A) such Subsidiary shall (1) grant to
the Collateral Agent a first priority Lien (subject only to Permitted Liens) on
all property of such Subsidiary by executing and delivering a counterpart of the
Pledge Agreement, taking all actions required pursuant to Section 25 of the
Pledge Agreement to become a Pledgor thereunder, and taking any other action
reasonably requested by the Administrative Agent and (2) execute and deliver a
counterpart of the Guaranty and (B) the Borrower shall pledge and deliver, or
cause to be pledged and delivered, all of the capital stock of such Subsidiary
owned by any Credit Party to the Collateral Agent.
 
(ii)  On each Vessel Exchange Date, the Administrative Agent shall have received
from counsel to the Credit Parties acceptable to the Administrative Agent
consummating the relevant Vessel Exchange opinions reasonably satisfactory to
the Administrative Agent practicing in those jurisdictions in which the
Acceptable Replacement Vessel is registered and/or the Credit Party owning such
Acceptable Replacement Vessel is organized, which opinions shall be addressed to
the Administrative Agent and each of the Lenders and dated such Vessel Exchange
Date, which shall (x) be in form and substance reasonably acceptable to the
Administrative Agent and (y) cover the perfection of the security interests
granted pursuant to the Vessel Mortgage(s) and such other matters incident
thereto as the Administrative Agent may reasonably request.
 
(iii)  On each Vessel Exchange Date, the Credit Party which is consummating a
Vessel Exchange on such date shall have duly authorized, executed and delivered
an Assignment of Earnings, an Assignment of Insurances, and (if applicable) an
Assignment of Charters, together covering all of such Credit Party’s present and
future Earnings and Insurance Collateral, in each case together with:
 
(A)  proper Financing Statements (Form UCC-1) fully executed for filing under
the UCC or in other appropriate filing offices of each jurisdiction as may be
necessary or, in the reasonable opinion of the Collateral Agent, desirable to
perfect the security interests purported to be created by the Assignment of
Earnings, the Assignment of Insurances and the Assignment of Charters;
 
(B)  certified copies of Requests for Information or Copies (Form UCC-11), or
equivalent reports, listing all effective financing statements that name any
Credit Party as debtor and that are filed in the jurisdictions referred to in
clause (A) above, together with copies of such other financing statements (none
of which shall cover the Collateral except to the extent evidencing Permitted
Liens unless in respect of which the Collateral Agent shall have received Form
UCC-3 Termination Statements (or such other termination statements as shall be
required by local law) fully executed for filing if required by applicable
laws); and
 
 
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(C)  evidence that all other actions necessary or, in the reasonable opinion of
the Collateral Agent, desirable to perfect and protect the security interests
purported to be created by the Assignment of Earnings, the Assignment of
Insurances and (if applicable) the Assignment of Charters have been taken.
 
(iv)  On each Vessel Exchange Date, the Credit Party which is consummating a
Vessel Exchange on such date shall have duly authorized, executed and delivered,
and caused to be recorded in the appropriate vessel registry a Vessel Mortgage
with respect to each of such Acceptable Replacement Vessel and such Vessel
Mortgages shall be effective to create in favor of the Collateral Agent and/or
the Lenders a legal, valid and enforceable first priority security interest, in
and lien upon such Acceptable Replacement Vessels, subject only to Permitted
Liens.  Except as specifically provided above, all filings, deliveries of
instruments and other actions necessary or desirable in the reasonable opinion
of the Administrative Agent to perfect and preserve such security interests
shall have been duly effected and the Administrative Agent shall have received
evidence thereof in form and substance reasonably satisfactory to the
Administrative Agent.
 
(v)  On each Vessel Exchange Date, the Administrative Agent shall have received
each of the following with respect to the relevant Acceptable Replacement
Vessel:
 
(A)  certificates of ownership from appropriate authorities showing (or
confirmation updating previously reviewed certificates and indicating) the
registered ownership of such Acceptable Replacement Vessel by the relevant
Subsidiary Guarantor,
 
(B)  the results of maritime registry searches with respect to such Acceptable
Replacement Vessel, indicating no record liens other than Liens in favor of the
Collateral Agent and/or the Lenders and Permitted Liens,
 
(C)  class certificates from a classification society listed on Schedule IX
hereto or another internationally recognized classification society acceptable
to the Administrative Agent, indicating that such Acceptable Replacement Vessel
meets the criteria specified in Section 9.23,
 
(D)  Appraisals of recent date and from at least two Approved Appraisers in
scope, form and substance reasonably satisfactory to the Administrative Agent,
and
 
(E)  a report, in form and scope reasonably satisfactory to the Administrative
Agent, from a firm of independent marine insurance brokers reasonably acceptable
to the Administrative Agent with respect to the insurance maintained by the
Credit Party in respect of such Acceptable Replacement Vessel, together with a
certificate from such broker certifying that such insurances (i) are placed with
such insurance companies and/or underwriters and/or clubs, in such amounts,
against such risks, and in such form, as are customarily insured against by
similarly situated insureds for the protection of the Administrative Agent
 
 
 
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and/or the Lenders as mortgagee and (ii) conform with the insurance requirements
of the respective Vessel Mortgages.
 
(vi)  On or prior to each Vessel Exchange Date:
 
(A)  the Administrative Agent shall have received a certificate, dated the
Vessel Exchange Date, signed by the senior financial officer of the Borrower
which certificate shall set forth the calculations required to establish whether
the Borrower is in compliance with the provisions of Section 9.09 after giving
effect to such Vessel Exchange,
 
(B)  the Administrative Agent shall have received a certificate, dated the
Vessel Exchange Date, signed by an Authorized Officer, member or general partner
of the Credit Party commencing such Vessel Exchange, certifying that (1) all
necessary governmental (domestic and foreign) and third party approvals and/or
consents (including any necessary anti-trust approvals or consents) in
connection with the Vessel Exchange being consummated on such date and otherwise
referred to herein shall have been obtained and remain in effect, and all
applicable waiting periods shall have expired without any action being taken by
any competent authority which, in the reasonable judgment of the Administrative
Agent, restrains, prevents or imposes materially adverse conditions upon the
consummation of such Vessel Exchange or the transactions contemplated by this
Agreement and (2) there exists no judgment, order, injunction or other restraint
prohibiting or imposing materially adverse conditions upon such Vessel Exchange
or the other transactions contemplated by this Agreement, and
 
(C)  the Administrative Agent shall have received such other documents,
certificates and opinions as it shall have reasonably requested.
 
“Vessel Exchange Date” shall mean each date on which a Vessel Exchange is
consummated.
 
“Vessel Mortgage” shall mean a first preferred mortgage in substantially the
form of Exhibit L-1 or L-2, or such other form as may be reasonably satisfactory
to the Administrative Agent, as such first preferred mortgage may be amended,
modified or supplemented from time to time in accordance with the terms hereof
and thereof.
 
“Wholly-Owned Subsidiary” shall mean, as to any Person, (i) any corporation 100%
of whose capital stock (other than director’s qualifying shares) is at the time
owned by such Person and/or one or more Wholly-Owned Subsidiaries of such Person
and (ii) any partnership, limited liability company, association, joint venture
or other entity in which such Person and/or one or more Wholly-Owned
Subsidiaries of such Person has a 100% equity interest at such time.
 
 
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SECTION 14.  Agency and Security Trustee Provisions.
 
14.01  Appointment.  (a)  The Lenders hereby designate DnB NOR Bank ASA, New
York Branch, as Administrative Agent (for purposes of this Section 12, the term
“Administrative Agent” shall include DnB NOR ASA, New York Branch (and/or any of
its affiliates) in its capacity as Collateral Agent pursuant to the Security
Documents and in its capacity as security trustee pursuant to the Vessel
Mortgages) to act as specified herein and in the other Credit Documents.  The
Lenders hereby designate DnB NOR Bank ASA, New York Branch, as Mandated Lead
Arranger to act as specified herein and in the other Credit Documents.  Each
Lender hereby irrevocably authorizes, and each holder of any Note by the
acceptance of such Note shall be deemed irrevocably to authorize, the Agents to
take such action on its behalf under the provisions of this Agreement, the other
Credit Documents and any other instruments and agreements referred to herein or
therein and to exercise such powers and to perform such duties hereunder and
thereunder as are specifically delegated to or required of the Agents by the
terms hereof and thereof and such other powers as are reasonably incidental
thereto.  The Agents may perform any of its duties hereunder by or through its
respective officers, directors, agents, employees or affiliates and, may assign
from time to time any or all of its rights, duties and obligations hereunder and
under the Security Documents to any of its banking affiliates.
 
(b)  The Lenders hereby irrevocably appoint DnB NOR ASA, New York Branch as
security trustee solely or the purpose of holding legal title to the Vessel
Mortgages on each of the flag vessels of an Acceptable Flag Jurisdiction on
behalf of the applicable Lenders, from time to time, with regard to the
(i) security, powers, rights, titles, benefits and interests (both present and
future) constituted by and conferred on the Lenders or any of them or for the
benefit thereof under or pursuant to the Vessel Mortgages (including, without
limitation, the benefit of all covenants, undertakings, representations,
warranties and obligations given, made or undertaken by any Lender in the Vessel
Mortgages), (ii) all money, property and other assets paid or transferred to or
vested in any Lender or any agent of any Lender or received or recovered by any
Lender or any agent of any Lender pursuant to, or in connection with the Vessel
Mortgages, whether from the Borrower or any Subsidiary Guarantor or any other
person and (iii) all money, investments, property and other assets at any time
representing or deriving from any of the foregoing, including all interest,
income and other sums at any time received or receivable by any Lender or any
agent of any Lender in respect of the same (or any part thereof).  DnB Nor Bank
ASA, New York Branch, hereby accepts such appointment as security trustee.
 
14.02  Nature of Duties.  The Agents shall have no duties or responsibilities
except those expressly set forth in this Agreement and the Security
Documents.  None of the Agents nor any of their respective officers, directors,
agents, employees or affiliates shall be liable for any action taken or omitted
by it or them hereunder or under any other Credit Document or in connection
herewith or therewith, unless caused by such Person’s gross negligence or
willful misconduct (any such liability limited to the applicable Agent to whom
such Person relates).  The duties of each of the Agents shall be mechanical and
administrative in nature; none of the Agents shall have by reason of this
Agreement or any other Credit Document any fiduciary relationship in respect of
any Lender or the holder of any Note; and nothing in this Agreement or any other
Credit Document, expressed or implied, is intended to or shall be so
 
 
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construed as to impose upon any Agents any obligations in respect of this
Agreement or any other Credit Document except as expressly set forth herein or
therein.
 
14.03  Lack of Reliance on the Agents.  Independently and without reliance upon
the Agents, each Lender and the holder of each Note, to the extent it deems
appropriate, has made and shall continue to make (i) its own independent
investigation of the financial condition and affairs of the Borrower and its
Subsidiaries in connection with the making and the continuance of the Loans and
the taking or not taking of any action in connection herewith and (ii) its own
appraisal of the creditworthiness of the Borrower and its Subsidiaries and,
except as expressly provided in this Agreement, none of the Agents shall have
any duty or responsibility, either initially or on a continuing basis, to
provide any Lender or the holder of any Note with any credit or other
information with respect thereto, whether coming into its possession before the
making of the Loans or at any time or times thereafter.  None of the Agents
shall be responsible to any Lender or the holder of any Note for any recitals,
statements, information, representations or warranties herein or in any
document, certificate or other writing delivered in connection herewith or for
the execution, effectiveness, genuineness, validity, enforceability, perfection,
collectibility, priority or sufficiency of this Agreement or any other Credit
Document or the financial condition of the Borrower and its Subsidiaries or be
required to make any inquiry concerning either the performance or observance of
any of the terms, provisions or conditions of this Agreement or any other Credit
Document, or the financial condition of the Borrower and its Subsidiaries or the
existence or possible existence of any Default or Event of Default.
 
14.04  Certain Rights of the Agents.  If any of the Agents shall request
instructions from the Required Lenders with respect to any act or action
(including failure to act) in connection with this Agreement or any other Credit
Document, the Agents shall be entitled to refrain from such act or taking such
action unless and until the Agents shall have received instructions from the
Required Lenders; and the Agents shall not incur liability to any Person by
reason of so refraining.  Without limiting the foregoing, no Lender or the
holder of any Note shall have any right of action whatsoever against the Agents
as a result of any of the Agents acting or refraining from acting hereunder or
under any other Credit Document in accordance with the instructions of the
Required Lenders.
 
14.05  Reliance.  Each of the Agents shall be entitled to rely, and shall be
fully protected in relying, upon any note, writing, resolution, notice,
statement, certificate, telex, teletype or telecopier message, cablegram,
radiogram, order or other document or telephone message signed, sent or made by
any Person that the applicable Agent believed to be the proper Person, and, with
respect to all legal matters pertaining to this Agreement and any other Credit
Document and its duties hereunder and thereunder, upon advice of counsel
selected by the Administrative Agent.
 
14.06  Indemnification.  To the extent any of the Agents is not reimbursed and
indemnified by the Borrower, the Lenders will reimburse and indemnify the
applicable Agents, in proportion to their respective “percentages” as used in
determining the Required Lenders, for and against any and all liabilities,
obligations, losses, damages, penalties, claims, actions, judgments, costs,
expenses or disbursements of whatsoever kind or nature which may be imposed on,
asserted against or incurred by such Agents in performing their respective
duties hereunder or under any other Credit Document, in any way relating to or
arising out of this
 
 
 
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Agreement or any other Credit Document; provided that no Lender shall be liable
in respect to an Agent for any portion of such liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
resulting from such Agent’s gross negligence or willful misconduct.
 
14.07  The Administrative Agent in its Individual Capacity.  With respect to its
obligation to make Loans under this Agreement, each of the Agents shall have the
rights and powers specified herein for a “Lender” and may exercise the same
rights and powers as though it were not performing the duties specified herein;
and the term “Lenders,” “Secured Creditors”, “Required Lenders”, “holders of
Notes” or any similar terms shall, unless the context clearly otherwise
indicates, include each of the Agents in their respective individual
capacity.  Each of the Agents may accept deposits from, lend money to, and
generally engage in any kind of banking, trust or other business with any Credit
Party or any Affiliate of any Credit Party as if it were not performing the
duties specified herein, and may accept fees and other consideration from the
Borrower or any other Credit Party for services in connection with this
Agreement and otherwise without having to account for the same to the Lenders.
 
14.08  Holders.  The Administrative Agent may deem and treat the payee of any
Note as the owner thereof for all purposes hereof unless and until a written
notice of the assignment, transfer or endorsement thereof, as the case may be,
shall have been filed with the Administrative Agent.  Any request, authority or
consent of any Person who, at the time of making such request or giving such
authority or consent, is the holder of any Note shall be conclusive and binding
on any subsequent holder, transferee, assignee or endorsee, as the case may be,
of such Note or of any Note or Notes issued in exchange therefore.
 
14.09  Resignation by the Administrative Agent.  (a)  The Administrative Agent
may resign from the performance of all its functions and duties hereunder and/or
under the other Credit Documents at any time by giving 15 Business Days’ prior
written notice to the Borrower and the Lenders.  Such resignation shall take
effect upon the appointment of a successor Administrative Agent pursuant to
clauses (b) and (c) below or as otherwise provided below.  
 
(b)  Upon any such notice of resignation by the Administrative Agent, the
Required Lenders shall appoint a successor Administrative Agent hereunder or
thereunder who shall be a commercial bank or trust company reasonably acceptable
to the Borrower.
 
(c)  If a successor Administrative Agent shall not have been so appointed within
such 15 Business Day period, the Administrative Agent, with the consent of the
Borrower (which shall not be unreasonably withheld or delayed), shall then
appoint a commercial bank or trust company with capital and surplus of not less
than $500,000,000 as successor Administrative Agent who shall serve as
Administrative Agent hereunder or thereunder until such time, if any, as the
Lenders appoint a successor Administrative Agent as provided above.
 
(d)  If no successor Administrative Agent has been appointed pursuant to clause
(b) or (c) above by the 25th Business Day after the date such notice of
resignation was given by the Administrative Agent, the Administrative Agent’s
resignation shall become effective and the Required Lenders shall thereafter
perform all the duties of the Administrative
 
 
 
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Agent hereunder and/or under any other Credit Document until such time, if any,
as the Required Lenders appoint a successor Administrative Agent as provided
above.
 
SECTION 15.  Miscellaneous.
 
15.01  Payment of Expenses, etc.  The Borrower agrees that it
shall:  (i) whether or not the transactions herein contemplated are consummated,
pay all reasonable out-of-pocket costs and expenses of each of the Agents
(including, without limitation, the reasonable fees and disbursements of Seward
& Kissel LLP, Johnson Stokes & Master, other counsel to the Administrative Agent
and the Mandated Lead Arranger and local counsel) in connection with the
preparation, execution and delivery of this Agreement and the other Credit
Documents and the documents and instruments referred to herein and therein and
any amendment, waiver or consent relating hereto or thereto, of the Agents in
connection with their respective syndication efforts with respect to this
Agreement and of the Agents and each of the Lenders in connection with the
enforcement of this Agreement and the other Credit Documents and the documents
and instruments referred to herein and therein (including, without limitation,
the reasonable fees and disbursements of counsel (including in-house counsel)
for each of the Agents and for each of the Lenders); (ii) pay and hold each of
the Lenders harmless from and against any and all present and future stamp,
documentary, transfer, sales and use, value added,  excise and other similar
taxes with respect to the foregoing matters and save each of the Lenders
harmless from and against any and all liabilities with respect to or resulting
from any delay or omission (other than to the extent attributable to such
Lender) to pay such taxes; and (iii) indemnify the Agents, the Collateral Agent
and each Lender, and each of their respective officers, directors, trustees,
employees, representatives and agents from and hold each of them harmless
against any and all liabilities, obligations (including removal or remedial
actions), losses, damages, penalties, claims, actions, judgments, suits, costs,
expenses and disbursements (including reasonable attorneys’ and consultants’
fees and disbursements) incurred by, imposed on or assessed against any of them
as a result of, or arising out of, or in any way related to, or by reason of,
(a) any investigation, litigation or other proceeding (whether or not any of the
Agents, the Collateral Agent or any Lender is a party thereto) related to the
entering into and/or performance of this Agreement or any other Credit Document
or the proceeds of any Loans hereunder or the consummation of any transactions
contemplated herein, or in any other Credit Document or the exercise of any of
their rights or remedies provided herein or in the other Credit Documents, or
(b) the actual or alleged presence of Hazardous Materials on any Vessel or in
the air, surface water or groundwater or on the surface or subsurface of any
property at any time owned or operated by the Borrower or any of its
Subsidiaries, the generation, storage, transportation, handling, disposal or
Environmental Release of Hazardous Materials at any location, whether or not
owned or operated by the Borrower or any of its Subsidiaries, the non-compliance
of any Vessel or property with foreign, federal, state and local laws,
regulations, and ordinances (including applicable permits thereunder) applicable
to any Vessel or property, or any Environmental Claim asserted against the
Borrower, any of its Subsidiaries or any Vessel or property at any time owned or
operated by the Borrower or any of its Subsidiaries, including, in each case,
without limitation, the reasonable fees and disbursements of counsel and other
consultants incurred in connection with any such investigation, litigation or
other proceeding (but excluding any losses, liabilities, claims, damages,
penalties, actions, judgments, suits, costs, disbursements or expenses to the
extent incurred by reason of the gross negligence or willful misconduct of the
Person to be indemnified).  To the extent that the undertaking to indemnify,
 
 
 
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pay or hold harmless each of the Agents or any Lender set forth in the preceding
sentence may be unenforceable because it violates any law or public policy, the
Borrower shall make the maximum contribution to the payment and satisfaction of
each of the indemnified liabilities which is permissible under applicable
law.  Notwithstanding the foregoing, neither any Agent nor any Lender, nor any
of their respective Affiliates, Subsidiaries, officers, directors and employees
shall be responsible to any Person for any consequential, indirect, special or
punitive damages which may be alleged by such Person arising out of this
Agreement or the other Credit Documents.
 
15.02  Right of Setoff.  In addition to any rights now or hereafter granted
under applicable law or otherwise, and not by way of limitation of any such
rights, upon the occurrence and during the continuance of an Event of Default,
each Lender is hereby authorized at any time or from time to time, without
presentment, demand, protest or other notice of any kind to any Subsidiary or
the Borrower or to any other Person, any such notice being hereby expressly
waived, to set off and to appropriate and apply any and all deposits (general or
special) and any other Indebtedness at any time held or owing by such Lender
(including, without limitation, by branches and agencies of such Lender wherever
located) to or for the credit or the account of the Borrower or any Subsidiary
but in any event excluding assets held in trust for any such Person against and
on account of the Obligations and liabilities of the Borrower or such
Subsidiary, as applicable, to such Lender under this Agreement or under any of
the other Credit Documents, including, without limitation, all interests in
Obligations purchased by such Lender pursuant to Section 15.06(b), and all other
claims of any nature or description arising out of or connected with this
Agreement or any other Credit Document, irrespective of whether or not such
Lender shall have made any demand hereunder and although said Obligations,
liabilities or claims, or any of them, shall be contingent or unmatured.
 
15.03  Notices.  Except as otherwise expressly provided herein, all notices and
other communications provided for hereunder shall be in writing (including
telexed, telegraphic or telecopier communication) and mailed, telexed,
telecopied or delivered:  if to the Borrower, at the Borrower’s address
specified under its signature below; if to any Lender, at its address specified
opposite its name on Schedule II below; and if to the Administrative Agent, at
its Notice Office; or, as to any other Credit Party, at such other address as
shall be designated by such party in a written notice to the other parties
hereto and, as to each Lender, at such other address as shall be designated by
such Lender in a written notice to the Borrower and the Administrative
Agent.  All such notices and communications shall, (i) when mailed, be effective
three Business Days after being deposited in the mails, prepaid and properly
addressed for delivery, (ii) when sent by overnight courier, be effective one
Business Day after delivery to the overnight courier prepaid and properly
addressed for delivery on such next Business Day, or (iii) when sent by telex or
telecopier, be effective when sent by telex or telecopier, except that notices
and communications to the Administrative Agent shall not be effective until
received by the Administrative Agent.
 
15.04  Benefit of Agreement.  (a)  This Agreement shall be binding upon and
inure to the benefit of and be enforceable by the respective successors and
assigns of the parties hereto; provided, however, that (i) no Credit Party may
assign or transfer any of its rights, obligations or interest hereunder or under
any other Credit Document without the prior written consent of the Lenders,
(ii) although any Lender may transfer, assign or grant participations in its
 
 
 
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rights hereunder, such Lender shall remain a “Lender” for all purposes hereunder
(and may not transfer or assign all or any portion of its Commitments hereunder
except as provided in Section 15.04(b)) and the transferee, assignee or
participant, as the case may be, shall not constitute a “Lender” hereunder and
(iii) no Lender shall transfer or grant any participation under which the
participant shall have rights to approve any amendment to or waiver of this
Agreement or any other Credit Document except to the extent such amendment or
waiver would (x) extend the final scheduled maturity of any Loan or Note in
which such participant is participating, or reduce the rate or extend the time
of payment of interest or Commitment Commission thereon (except in connection
with a waiver of applicability of any post-default increase in interest rates)
or reduce the principal amount thereof, or increase the amount of the
participant’s participation over the amount thereof then in effect (it being
understood that a waiver of any Default or Event of Default or of a mandatory
reduction in the Total Commitments shall not constitute a change in the terms of
such participation, and that an increase in any Commitment or Loan shall be
permitted without the consent of any participant if the participant’s
participation is not increased as a result thereof), (y) consent to the
assignment or transfer by the Borrower of any of its rights and obligations
under this Agreement or (z) release all or substantially all of the Collateral
under all of the Security Documents (except as expressly provided in the Credit
Documents) securing the Loans hereunder in which such participant is
participating.  In the case of any such participation, the participant shall not
have any rights under this Agreement or any of the other Credit Documents (the
participant’s rights against such Lender in respect of such participation to be
those set forth in the agreement executed by such Lender in favor of the
participant relating thereto) and all amounts payable by the Borrower hereunder
shall be determined as if such Lender had not sold such participation.
 
(b)  Notwithstanding the foregoing, any Lender (or any Lender together with one
or more other Lenders) may (x) assign all or a portion of its Commitment and/or
its outstanding Loans to its (i) parent company and/or any affiliate of such
Lender which is at least 50% owned by such Lender or its parent company or
(ii) in the case of any Lender that is a fund that invests in bank loans, any
other fund that invests in bank loans and is managed or advised by the same
investment advisor of such Lender or by an Affiliate of such investment advisor
or (iii) to one or more Lenders or (y) assign with the consent of the Borrower
(which consent shall not be unreasonably withheld or delayed and shall not be
required if any Event of Default is then in existence) all, or if less than all,
a portion equal to at least $5,000,000 in the aggregate for the assigning Lender
or assigning Lenders, of such Commitments and outstanding principal amount of
Loans hereunder to one or more Eligible Transferees (treating any fund that
invests in bank loans and any other fund that invests in bank loans and is
managed or advised by the same investment advisor of such fund or by an
Affiliate of such investment advisor as a single Eligible Transferee), each of
which assignees shall become a party to this Agreement as a Lender by execution
of an Assignment and Assumption Agreement, provided that (i) at such time
Schedule I shall be deemed modified to reflect the Commitments (and/or
outstanding Loans, as the case may be) of such new Lender and of the existing
Lenders, (ii) new Notes will be issued, at the Borrower’s expense, to such new
Lender and to the assigning Lender upon the request of such new Lender or
assigning Lender, such new Notes to be in conformity with the requirements of
Section 1.05 (with appropriate modifications) to the extent needed to reflect
the revised Commitments (and/or outstanding Loans, as the case may be),
(iii) the consent of the Administrative Agent and each Issuing Bank shall be
required in connection with any assignment pursuant to preceding clause
(y) (which consent shall not be unreasonably withheld
 
 
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or delayed), and (iv) the Administrative Agent shall receive at the time of each
such assignment, from the assigning or assignee Lender, the payment of a
non-refundable assignment fee of $3,000.  To the extent of any assignment
pursuant to this Section 15.04(b), the assigning Lender shall be relieved of its
obligations hereunder with respect to its assigned Commitments (it being
understood that the indemnification provisions under this Agreement (including,
without limitation, Sections 1.09, 1.10, 2.05, 4.04, 15.01 and 15.06) shall
survive as to such assigning Lender).  To the extent that an assignment of all
or any portion of a Lender’s Commitments and related outstanding Obligations
pursuant to Section 1.12 or this Section 15.04(b) would, at the time of such
assignment, result in increased costs under Section 1.09, 1.10, 2.05 or 4.04
from those being charged by the respective assigning Lender prior to such
assignment, then the Borrower shall not be obligated to pay such increased costs
(although the Borrower shall be obligated to pay any other increased costs of
the type described above resulting from changes after the date of the respective
assignment).
 
(c)  Nothing in this Agreement shall prevent or prohibit any Lender from
pledging its Loans and Notes hereunder to a Federal Reserve Bank in support of
borrowings made by such Lender from such Federal Reserve Bank and, with the
consent of the Administrative Agent, any Lender which is a fund may pledge all
or any portion of its Notes or Loans to a trustee for the benefit of investors
and in support of its obligation to such investors.
 
15.05  No Waiver; Remedies Cumulative.  No failure or delay on the part of the
Administrative Agent or any Lender or any holder of any Note in exercising any
right, power or privilege hereunder or under any other Credit Document and no
course of dealing between the Borrower or any other Credit Party and the
Administrative Agent or any Lender or the holder of any Note shall operate as a
waiver thereof; nor shall any single or partial exercise of any right, power or
privilege hereunder or under any other Credit Document preclude any other or
further exercise thereof or the exercise of any other right, power or privilege
hereunder or thereunder.  The rights, powers and remedies herein or in any other
Credit Document expressly provided are cumulative and not exclusive of any
rights, powers or remedies which the Administrative Agent or any Lender or the
holder of any Note would otherwise have.  No notice to or demand on any Credit
Party in any case shall entitle any Credit Party to any other or further notice
or demand in similar or other circumstances or constitute a waiver of the rights
of the Administrative Agent or any Lender or the holder of any Note to any other
or further action in any circumstances without notice or demand.
 
15.06  Payments Pro Rata.  (a)  Except as otherwise provided in this Agreement,
the Administrative Agent agrees that promptly after its receipt of each payment
from or on behalf of the Borrower in respect of any Obligations hereunder, it
shall distribute such payment to the Lenders (other than any Lender that has
consented in writing to waive its pro rata share of any such payment) pro rata
based upon their respective shares, if any, of the Obligations with respect to
which such payment was received.
 
(b)  Each of the Lenders agrees that, if it should receive any amount hereunder
(whether by voluntary payment, by realization upon security, by the exercise of
the right of setoff or banker’s lien, by counterclaim or cross action, by the
enforcement of any right under the Credit Documents, or otherwise), which is
applicable to the payment of the principal of, or interest on, the Loans or
Commitment Commission, of a sum which with respect to the related
 
 
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sum or sums received by other Lenders is in a greater proportion than the total
of such Obligation then owed and due to such Lender bears to the total of such
Obligation then owed and due to all of the Lenders immediately prior to such
receipt, then such Lender receiving such excess payment shall purchase for cash
without recourse or warranty from the other Lenders an interest in the
Obligations of the respective Credit Party to such Lenders in such amount as
shall result in a proportional participation by all the Lenders in such amount;
provided that if all or any portion of such excess amount is thereafter
recovered from such Lender, such purchase shall be rescinded and the purchase
price restored to the extent of such recovery, but without interest.
 
15.07  Calculations; Computations.  (a)  The financial statements to be
furnished to the Lenders pursuant hereto shall be made and prepared in
accordance with generally accepted accounting principles in the United States
consistently applied throughout the periods involved (except as set forth in the
notes thereto or as otherwise disclosed in writing by the Borrower to the
Lenders).  In addition, all computations determining compliance with Sections
11.07 through 11.11, inclusive, shall utilize accounting principles and policies
in conformity with those in effect on the Effective Date (with the foregoing
generally accepted accounting principles, subject to the preceding proviso,
herein called “GAAP”).  Unless otherwise noted, all references in this Agreement
to “generally accepted accounting principles” shall mean generally accepted
accounting principles as in effect in the United States.
 
(b)  All computations of interest and Commitment Commission hereunder shall be
made on the basis of a year of 360 days for the actual number of days (including
the first day but excluding the last day) occurring in the period for which such
interest or Commitment Commission are payable.
 
15.08  GOVERNING LAW; SUBMISSION TO JURISDICTION; VENUE; WAIVER OF JURY
TRIAL.  (a)  THIS AGREEMENT AND THE OTHER CREDIT DOCUMENTS AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HEREUNDER AND THEREUNDER SHALL, EXCEPT AS OTHERWISE
PROVIDED IN CERTAIN OF THE VESSEL MORTGAGES, BE CONSTRUED IN ACCORDANCE WITH AND
BE GOVERNED BY THE LAW OF THE STATE OF NEW YORK WITHOUT REGARD TO ITS CONFLICT
OF LAWS RULES (OTHER THAN TITLE 14 OF ARTICLE 5 OF THE GENERAL OBLIGATIONS
LAW).  ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY
OTHER CREDIT DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF NEW YORK
LOCATED IN THE COUNTY OF NEW YORK OR OF THE UNITED STATES FOR THE SOUTHERN
DISTRICT OF NEW YORK, AND, BY EXECUTION AND DELIVERY OF THIS AGREEMENT, THE
BORROWER HEREBY IRREVOCABLY ACCEPTS FOR ITSELF AND IN RESPECT OF ITS PROPERTY,
GENERALLY AND UNCONDITIONALLY, THE JURISDICTION OF THE AFORESAID COURTS.  THE
BORROWER FURTHER IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS OUT OF ANY OF
THE AFOREMENTIONED COURTS IN ANY SUCH ACTION OR PROCEEDING BY THE MAILING OF
COPIES THEREOF BY REGISTERED MAIL, POSTAGE PREPAID, TO THE BORROWER AT ITS
ADDRESS SET FORTH OPPOSITE ITS SIGNATURE BELOW, SUCH SERVICE TO BECOME EFFECTIVE
30 DAYS AFTER SUCH MAILING.  NOTHING HEREIN SHALL AFFECT THE RIGHT OF THE
ADMINISTRATIVE AGENT UNDER THIS
 
 
 
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AGREEMENT, ANY LENDER OR THE HOLDER OF ANY NOTE TO SERVE PROCESS IN ANY OTHER
MANNER PERMITTED BY LAW OR TO COMMENCE LEGAL PROCEEDINGS OR OTHERWISE PROCEED
AGAINST ANY CREDIT PARTY IN ANY OTHER JURISDICTION.  IF AT ANY TIME DURING WHICH
THIS AGREEMENT OR ANY OTHER CREDIT DOCUMENT REMAINS IN EFFECT, THE BORROWER DOES
NOT MAINTAIN A REGULARLY FUNCTIONING OFFICE IN NEW YORK CITY, IT WILL DULY
APPOINT, AND AT ALL TIMES MAINTAIN, AN AGENT IN NEW YORK CITY FOR THE SERVICE OF
PROCESS OR SUMMONS, AND WILL PROVIDE TO THE ADMINISTRATIVE AGENT AND THE LENDERS
WRITTEN NOTICE OF THE IDENTITY AND ADDRESS OF SUCH AGENT FOR SERVICE OF PROCESS
OR SUMMONS; PROVIDED THAT ANY FAILURE ON THE PART OF  THE BORROWER TO COMPLY
WITH THE FOREGOING PROVISIONS OF THIS SENTENCE SHALL NOT IN ANY WAY PREJUDICE OR
LIMIT THE SERVICE OF PROCESS OR SUMMONS IN ANY OTHER MANNER DESCRIBED ABOVE IN
THIS SECTION 15.08 OR OTHERWISE PERMITTED BY LAW.
 
(b)  THE BORROWER HEREBY IRREVOCABLY WAIVES ANY OBJECTION WHICH IT MAY NOW OR
HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY OF THE AFORESAID ACTIONS OR
PROCEEDINGS ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT OR ANY OTHER
CREDIT DOCUMENT BROUGHT IN THE COURTS REFERRED TO IN CLAUSE (a) ABOVE AND HEREBY
FURTHER IRREVOCABLY WAIVES AND AGREES NOT TO PLEAD OR CLAIM IN ANY SUCH COURT
THAT ANY SUCH ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN
AN INCONVENIENT FORUM.
 
(c)  EACH OF THE PARTIES TO THIS AGREEMENT HEREBY IRREVOCABLY WAIVES ALL RIGHT
TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR
RELATING TO THIS AGREEMENT, THE OTHER CREDIT DOCUMENTS OR THE TRANSACTIONS
CONTEMPLATED HEREBY OR THEREBY.
 
15.09  Counterparts.  This Agreement may be executed in any number of
counterparts and by the different parties hereto on separate counterparts, each
of which when so executed and delivered shall be an original, but all of which
shall together constitute one and the same instrument.  A set of counterparts
executed by all the parties hereto shall be lodged with the Borrower and the
Administrative Agent.
 
15.10  Effectiveness.  This Agreement shall become effective on the date (the
“Effective Date”) on which the Borrower, the Administrative Agent and each of
the Lenders who are initially parties hereto shall have signed a counterpart
hereof (whether the same or different counterparts) and shall have delivered the
same to the Administrative Agent or, in the case of the Lenders, shall have
given to the Administrative Agent telephonic (confirmed in writing), written or
facsimile notice (actually received) at such office that the same has been
signed and mailed to it.  The Administrative Agent will give the Borrower and
each Lender prompt written notice of the occurrence of the Effective Date.
 
 
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15.11  Headings Descriptive.  The headings of the several sections and
subsections of this Agreement are inserted for convenience only and shall not in
any way affect the meaning or construction of any provision of this Agreement.
 
15.12  Amendment or Waiver; etc.  (a)  Neither this Agreement nor any other
Credit Document nor any terms hereof or thereof may be changed, waived,
discharged or terminated unless such change, waiver, discharge or termination is
in writing signed by the respective Credit Parties party thereto and the
Required Lenders, provided that no such change, waiver, discharge or termination
shall, without the consent of each Lender (with Obligations being directly
affected in the case of following clause (i) and, in the case of the following
clause (vi), to the extent that any such Lender would be required to make a Loan
in excess of its pro rata portion provided for in this Agreement or would
receive a payment or prepayment of Loans or a commitment reduction that (in any
case) is less than its pro rata portion provided for in this Agreement, in each
case, as a result of any such amendment, modification or waiver referred to in
the following clause (vi)), (i) extend the final scheduled maturity of any Loan
or Note, extend the timing for or reduce the principal amount of any Commitment
reduction pursuant to Section 3.03(b) or (c) or reduce the rate or extend the
time of payment of interest on any Loan or Note or Letter of Credit Fee or
Commitment Commission (except in connection with the waiver of applicability of
any post-default increase in interest rates), or reduce the principal amount
thereof (except to the extent repaid in cash), (ii) release any Vessel Mortgage
(except as expressly provided in the Credit Documents), (iii) amend, modify or
waive any provision of this Section 15.12(a), (iv) reduce the percentage
specified in the definition of Required Lenders (it being understood that, with
the consent of the Required Lenders, additional extensions of credit pursuant to
this Agreement may be included in the determination of the Required Lenders on
substantially the same basis as the extensions of Loans and Commitments are
included on the Effective Date), (v) consent to the assignment or transfer by
the Borrower of any of its rights and obligations under this Agreement,
(vi) amend, modify or waive Section 1.06 or amend, modify or waive any other
provision in this Agreement to the extent providing for payments or prepayments
of Loans or reductions in Commitments, in each case, to be applied pro rata
among the Lenders entitled to such payments or prepayments of Loans or
reductions in Commitments (it being understood that the provision of additional
extensions of credit pursuant to this Agreement, or the waiver of reduction or
any mandatory prepayment of Loans by the Required Lenders shall not constitute
an amendment, modification or waiver for purposes of this clause (vi)), or
(vii) release any Subsidiary Guarantor from a Guaranty to the extent same owns a
Mortgaged Vessel; provided, further, that no such change, waiver, discharge or
termination shall (u) increase the Commitments of any Lender over the amount
thereof then in effect without the consent of such Lender (it being understood
that waivers or modifications of conditions precedent, covenants, Defaults or
Events of Default shall not constitute an increase of the Commitment of any
Lender, and that an increase in the available portion of any Commitment of any
Lender shall not constitute an increase in the Commitment of such Lender),
(v) without the consent of each Agent, amend, modify or waive any provision of
Section 14 as same applies to such Agent or any other provision as same relates
to the rights or obligations of such Agent, (w) without the consent of each
Issuing Lender, amend, modify or waive any provision of Section 2 or alter its
rights or obligations with respect to Letters of Credit or (x) without the
consent of the Collateral Agent, amend, modify or waive any provision relating
to the rights or obligations of the Collateral Agent.  
 
 
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(b)  If, in connection with any proposed change, waiver, discharge or
termination to any of the provisions of this Agreement as contemplated by
clauses (i) through (v), inclusive, of the first proviso to Sections 15.12(a),
the consent of the Required Lenders is obtained but the consent of one or more
of such other Lenders whose consent is required is not obtained, then the
Borrower shall have the right, so long as all non-consenting Lenders whose
individual consent is required are treated as described in either clauses (A) or
(B) below, to either (A) replace each such non-consenting Lender or Lenders with
one or more Replacement Lenders pursuant to Section 1.12 so long as at the time
of such replacement, each such Replacement Lender consents to the
proposed  change, waiver, discharge or termination or (B) terminate such
non-consenting Lender’s Commitment, and repay such non-consenting Lender’s
outstanding Loans, in accordance with Sections 3.02(b) and/or 4.01(iv), provided
that, unless the Commitments are terminated, and Loans repaid, pursuant to
preceding clause (B) are immediately replaced in full at such time through the
addition of new Lenders or the increase of the Commitments and/or outstanding
Loans of existing Lenders (who in each case must specifically consent thereto),
then in the case of any action pursuant to preceding clause (B) the Required
Lenders (determined before giving effect to the proposed action) shall
specifically consent thereto, provided, further, that in any event the Borrower
shall not have the right to replace a Lender, terminate its Commitment or repay
its Loans solely as a result of the exercise of such Lender’s rights (and the
withholding of any required consent by such Lender) pursuant to the second
proviso to Section 15.12(a).
 
15.13  Survival.  All indemnities set forth herein including, without
limitation, in Sections 1.09, 1.10, 2.05, 4.04, 15.01 and 15.06 shall, subject
to Section 15.15 (to the extent applicable), survive the execution, delivery and
termination of this Agreement and the Notes and the making and repayment of the
Loans.
 
15.14  Domicile of Loans.  Each Lender may transfer and carry its Loans at, to
or for the account of any office, Subsidiary or Affiliate of such
Lender.  Notwithstanding anything to the contrary contained herein, to the
extent that a transfer of Loans pursuant to this Section 15.14 would, at the
time of such transfer, result in increased costs under Section 1.09, 1.10, 2.05,
or 4.04 from those being charged by the respective Lender prior to such
transfer, then the Borrower shall not be obligated to pay such increased costs
(although the Borrower shall be obligated to pay any other increased costs of
the type described above resulting from changes after the date of the respective
transfer).
 
15.15  Limitation on Additional Amounts, etc.  Notwithstanding anything to the
contrary contained in Sections 1.09, 1.10, 2.05 or 4.04 of this Agreement,
unless a Lender gives notice to the Borrower that it is obligated to pay an
amount under any such Section within one year after the later of (x) in the case
of Taxes, the date the Lender receives notice from the relevant taxing authority
of the respective increased cost, Tax, loss, expense or liability, and in all
other cases the date the Lender incurs the respective increased cost, loss,
expense or liability, reduction in amounts received or receivable or reduction
in return on capital or (y) the date such Lender has actual knowledge of its
incurrence of the respective increased costs, Taxes, loss, expense or liability,
reductions in amounts received or receivable or reduction in return on capital,
then such Lender shall only be entitled to be compensated for such amount by the
Borrower pursuant to said Section 1.09, 1.10, 2.05 or 4.04, as the case may be,
to the extent the costs, Taxes, loss, expense or liability, reduction in amounts
received or receivable or reduction
 
 
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in return on capital are incurred or suffered on or after the date which occurs
one year prior to such Lender giving notice to the Borrower that it is obligated
to pay the respective amounts pursuant to said Section 1.09, 1.10, 2.05 or 4.04,
as the case may be.  This Section 15.15 shall have no applicability to any
Section of this Agreement other than said Sections 1.09, 1.10, 2.05 and 4.04.
 
15.16  Confidentiality.  (a)  Subject to the provisions of clause (b) of this
Section 15.16, each Lender agrees that it will use its best efforts not to
disclose without the prior consent of the Borrower (other than to its employees,
auditors, advisors or counsel or to another Lender if the Lender or such
Lender’s holding or parent company or board of trustees in its sole discretion
determines that any such party should have access to such information, provided
such Persons shall be subject to the provisions of this Section 15.16 to the
same extent as such Lender) any  information with respect to the Borrower or any
of its Subsidiaries which is now or in the future furnished pursuant to this
Agreement or any other Credit Document, provided that any Lender may disclose
any such information (a) as has become generally available to the public other
than by virtue of a breach of this Section 15.16(a) by the respective Lender,
(b) as may be required in any report, statement or testimony submitted to any
municipal, state or Federal regulatory body having or claiming to have
jurisdiction over such Lender or to the Federal Reserve Board or the Federal
Deposit Insurance Corporation or similar organizations (whether in the United
States or elsewhere) or their successors, (c) as may be required in respect to
any summons or subpoena or in connection with any litigation, (d) in order to
comply with any law, order, regulation or ruling applicable to such Lender,
(e) to the Administrative Agent or the Collateral Agent and (f) to any
prospective or actual transferee or participant in connection with any
contemplated transfer or participation of any of the Notes or Commitments or any
interest therein by such Lender, provided that such prospective transferee
expressly agrees to be bound by the confidentiality provisions contained in this
Section 15.16.
 
(b)  The Borrower hereby acknowledges and agrees that each Lender may share with
any of its affiliates any information related to the Borrower or any of its
Subsidiaries (including, without limitation, any nonpublic customer information
regarding the creditworthiness of the Borrower or its Subsidiaries), provided
such Persons shall be subject to the provisions of this Section 15.16 to the
same extent as such Lender.
 
15.17  Register.  The Borrower hereby designates the Administrative Agent to
serve as the Borrower’s agent, solely for purposes of this Section 15.17, to
maintain a register (the “Register”) on which it will record the Commitments
from time to time of each of the Lenders, the Loans made by each of the Lenders
and each repayment and prepayment in respect of the principal amount of the
Loans of each Lender.  Failure to make any such recordation, or any error in
such recordation  shall not affect the Borrower’s obligations in respect of such
Loans.  With respect to any Lender, the transfer of the Commitments of such
Lender and the rights to the principal of, and interest on, any Loan made
pursuant to such Commitments shall not be effective until such transfer is
recorded on the Register maintained by the Administrative Agent with respect to
ownership of such Commitments and Loans and prior to such recordation all
amounts owing to the transferor with respect to such Commitments and Loans shall
remain owing to the transferor.  The registration of assignment or transfer of
all or part of any Commitments and Loans shall be recorded by the Administrative
Agent on the Register only upon the acceptance by the Administrative Agent of a
properly executed and delivered
 
 
 
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Assignment and Assumption Agreement pursuant to Section 15.04(b).  Coincident
with the delivery of such an Assignment and Assumption Agreement to the
Administrative Agent for acceptance and registration of assignment or transfer
of all or part of a Loan, or as soon thereafter as practicable, the assigning or
transferor Lender shall surrender the Note evidencing such Loan, and thereupon
one or more new Notes in the same aggregate principal amount shall be issued to
the assigning or transferor Lender and/or the new Lender.  The Borrower agrees
to indemnify the Administrative Agent from and against any and all losses,
claims, damages and liabilities of whatsoever nature which may be imposed on,
asserted against or incurred by the Administrative Agent in performing its
duties under this Section 15.17, except to the extent caused by the
Administrative Agent’s own gross negligence or willful misconduct.
 
15.18  Judgment Currency.  If for the purposes of obtaining judgment in any
court it is necessary to convert a sum due from the Borrower hereunder or under
any of the Notes in the currency expressed to be payable herein or under the
Notes (the “specified currency”) into another currency, the parties hereto
agree, to the fullest extent that they may effectively do so, that the rate of
exchange used shall be that at which in accordance with normal banking
procedures the Administrative Agent could purchase the specified currency with
such other currency at the Administrative Agent’s New York office on the
Business Day preceding that on which final judgment is given.  The obligations
of the Borrower in respect of any sum due to any Lender or the Administrative
Agent hereunder or under any Note shall, notwithstanding any judgment in a
currency other than the specified currency, be discharged only to the extent
that on the Business Day following receipt by such Lender or the Administrative
Agent (as the case may be) of any sum adjudged to be so due in such other
currency such Lender or the Administrative Agent (as the case may be) may in
accordance with normal banking procedures purchase the specified currency with
such other currency; if the amount of the specified currency so purchased is
less than the sum originally due to such Lender or the Administrative Agent, as
the case may be, in the specified currency, the Borrower agrees, to the fullest
extent that it may effectively do so, as a separate obligation and
notwithstanding any such judgment, to indemnify such Lender or the
Administrative Agent, as the case may be, against such loss, and if the amount
of the specified currency so purchased exceeds the sum originally due to any
Lender or the Administrative Agent, as the case may be, in the specified
currency, such Lender or the Administrative Agent, as the case may be, agrees to
remit such excess to the Borrower.
 
15.19  Language.  All correspondence, including, without limitation, all
notices, reports and/or certificates, delivered by any Credit Party to the
Administrative Agent, the Collateral Agent or any Lender shall, unless otherwise
agreed by the respective recipients thereof, be submitted in the English
language or, to the extent the original of such document is not in the English
language, such document shall be delivered with a certified English translation
thereof.
 
15.20  Waiver of Immunity.  The Borrower, in respect of itself, each other
Credit Party, its and their process agents, and its and their properties and
revenues, hereby irrevocably agrees that, to the extent that the Borrower, any
other Credit Party or any of its or their properties has or may hereafter
acquire any right of immunity from any legal proceedings, whether in the United
States, the Republic of the Marshall Islands, Hong Kong or elsewhere, to enforce
or collect upon the Obligations of the Borrower or any other Credit Party
related to or arising from the transactions contemplated by any of the Credit
Documents, including, without limitation,
 
 
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immunity from service of process, immunity from jurisdiction or judgment of any
court or tribunal, immunity from execution of a judgment, and immunity of any of
its property from attachment prior to any entry of judgment, or from attachment
in aid of execution upon a judgment, the Borrower, for itself and on behalf of
the other Credit Parties, hereby expressly waives, to the fullest extent
permissible under applicable law, any such immunity, and agrees not to assert
any such right or claim in any such proceeding, whether in the United States,
the Republic of the Marshall Islands, Hong Kong or elsewhere.
 
15.21  USA PATRIOT Act Notice.  Each Lender hereby notifies each Credit Party
that pursuant to the requirements of the USA PATRIOT Act (Title III of Pub.:
107-56 (signed into law October 26, 2001)) (the “PATRIOT Act”), it is required
to obtain, verify, and record information that identifies each Credit Party,
which information includes the name of each Credit Party and other information
that will allow such Lender to identify each Credit Party in accordance with the
PATRIOT Act, and each Credit Party agrees to provide such information from time
to time to any Lender.
 
*     *     *
 
 
100
 
 
 

--------------------------------------------------------------------------------

 
 
 
IN WITNESS WHEREOF, the parties hereto have caused their duly authorized
officers to execute and deliver this Agreement as of the date first above
written.
 
                              GENCO SHIPPING & TRADING LIMITED,
                              as Borrower
 
                              By: /s/ John Wobensmith
 
Name: John Wobensmith

 
Title:  Chief Financial Officer

 
Address: 299 Park Avenue, 20th floor, New York, NY 10171

 
Telephone: 646-443-8550

 
Facsimile: 646-443-8551

   

  DNB NOR BANK ASA, NEW YORK BRANCH, as Administrative Agent, Collateral Agent,
Mandated Lead Arranger and a Lender 

 
                              By: /s/ Nikolai A. Nachamkin
 
Name: Nikolai A. Nachamkin

 
Title:  Senior Vice President

 

  By: /s/ Cathleen Buckley

 
Name: Cathleen Buckley

 
Title:  Vice President

 
 
 
 

--------------------------------------------------------------------------------

 
SCHEDULE I
 
 
 
THE LENDERS AND THE COMMITMENTS
 
 
Lender
Commitment
DNB NOR BANK ASA, NEW YORK BRANCH
$1,377,000,000
Totals
$1,377,000,000

 
 
 
 
 
 
 
 

--------------------------------------------------------------------------------

 
SCHEDULE II
 
 
 
THE LENDERS’ ADDRESSES
 
INSTITUTIONS
ADDRESSES
DNB NOR BANK ASA, NEW YORK BRANCH
DnB NOR Bank ASA
200 Park Avenue, 31st Floor
New York, NY  10166-0396
Attn:  Nikolai Nachamkin
           Cathleen Buckley
Telephone:  212-681-3863
              212-681-3861
Facsimile:  212-681-3900
e-mail:  nikolai.nachamkin@dnbnor.no
     cathleen.buckley@dnbnor.no

 
 
 
 
 
 
 

--------------------------------------------------------------------------------

 
SCHEDULE III
 
 
 
SUBSIDIARY GUARANTORS AND EXISTING VESSELS

Vessel Name
Vessel Owner
Registry Number
Jurisdiction of Registry
Flag
         
Genco Acheron
Genco Acheron Limited
HK-8742
Hong Kong
Hong Kong
Genco Beauty
Genco Beauty Limited
HK-1284
Hong Kong
Hong Kong
Genco Commander
Genco Commander Limited
HK-1781
Hong Kong
Hong Kong
Genco Knight
Genco Knight Limited
HK-1273
Hong Kong
Hong Kong
Genco Leader
Genco Leader Limited
HK-1046
Hong Kong
Hong Kong
Genco Muse
Genco Muse Limited
HK-1615
Hong Kong
Hong Kong
Genco Vigour
Genco Vigour Limited
HK-1283
Hong Kong
Hong Kong
Genco Trader
Genco Trader Limited
HK-1047
Hong Kong
Hong Kong
Genco Carrier
Genco Carrier Limited
HK-0993
Hong Kong
Hong Kong
Genco Prosperity
Genco Prosperity Limited
HK-0914
Hong Kong
Hong Kong
Genco Success
Genco Success Limited
HK-1113
Hong Kong
Hong Kong
Genco Wisdom
Genco Wisdom Limited
HK-0932
Hong Kong
Hong Kong
Genco Marine
Genco Marine Limited
HK-0709
Hong Kong
Hong Kong
Genco Explorer
Genco Explorer Limited
HK-0895
Hong Kong
Hong Kong
Genco Pioneer
Genco Pioneer Limited
HK-0970
Hong Kong
Hong Kong
Genco Progress
Genco Progress Limited
HK-0964
Hong Kong
Hong Kong
Genco Reliance
Genco Reliance Limited
HK-1124
Hong Kong
Hong Kong
Genco Surprise
Genco Surprise Limited
HK-1782
Hong Kong
Hong Kong
Genco Sugar
Genco Sugar Limited
HK-0732
Hong Kong
Hong Kong

 
 
 

--------------------------------------------------------------------------------

 
SCHEDULE IV

 
SUBSIDIARY GUARANTORS AND CAPESIZE VESSELS
 
Current Vessel Name
Vessel Owner
To Be Named
Ferro Goa
Genco Augustus Limited
Genco Augustus
Ferro Fos
Genco Tiberius Limited
Genco Tiberius
G Hull 1044
Genco London Limited
Genco London
G Hull 1118
Genco Titus Limited
Genco Titus
Hull S-8071
Genco Constantine Limited
Genco Constantine
Hull 1032
Genco Hadrian Limited
Genco Hadrian
Hull 1033
Genco Commodus Limited
Genco Commodus
Hull 1034
Genco Maximus Limited
Genco Maximus
Hull 1041
Genco Claudius Limited
Genco Claudius

 
 
 
 

--------------------------------------------------------------------------------

 
 
SCHEDULE V
 
 
 
INDEBTEDNESS
 
 
 

 

--------------------------------------------------------------------------------

 
SCHEDULE VI

 
 
 
 
INSURANCE
 
 
See attached.
 
 
 
 
 
 

--------------------------------------------------------------------------------

 
 
SCHEDULE VII

 
 
 
 
ERISA
 
 
None.

 
 
 
 
 
 
 

--------------------------------------------------------------------------------

 
SCHEDULE VIII
 
 
 
 
SUBSIDIARIES
 

 
Name of Subsidiary
 
Direct Owner(s)
Percent(%) Ownership
Jurisdiction of
Organization
Genco Acheron Limited
Genco Shipping & Trading Limited
100%
Marshall Islands
Genco Commander Limited
Genco Shipping & Trading Limited
100%
Marshall Islands
Genco Surprise Limited
Genco Shipping & Trading Limited
100%
Marshall Islands
Genco Muse Limited
Genco Shipping & Trading Limited
100%
Marshall Islands
Genco Pioneer Limited
Genco Shipping & Trading Limited
100%
Marshall Islands
Genco Carrier Limited
Genco Shipping & Trading Limited
100%
Marshall Islands
Genco Explorer Limited
Genco Shipping & Trading Limited
100%
Marshall Islands
Genco Vigour Limited
Genco Shipping & Trading Limited
100%
Marshall Islands
Genco Wisdom Limited
Genco Shipping & Trading Limited
100%
Marshall Islands
Genco Success Limited
Genco Shipping & Trading Limited
100%
Marshall Islands
Genco Sugar Limited
Genco Shipping & Trading Limited
100%
Marshall Islands
Genco Beauty Limited
Genco Shipping & Trading Limited
100%
Marshall Islands
Genco Knight Limited
Genco Shipping & Trading Limited
100%
Marshall Islands
Genco Reliance Limited
Genco Shipping & Trading Limited
100%
Marshall Islands
Genco Trader Limited
Genco Shipping & Trading Limited
100%
Marshall Islands
Genco Prosperity Limited
Genco Shipping & Trading Limited
100%
Marshall Islands
Genco Progress Limited
Genco Shipping & Trading Limited
100%
Marshall Islands
Genco Marine Limited
Genco Shipping & Trading Limited
100%
Marshall Islands
Genco Leader Limited
Genco Shipping & Trading Limited
100%
Marshall Islands
Genco Ship Management LLC
Genco Shipping & Trading Limited
100%
Delaware

 
 

--------------------------------------------------------------------------------

 
SCHEDULE IX

APPROVED CLASSIFICATION SOCIETIES
 
 
American Bureau of Shipping
Nippon Kaiji Kyokai
Germanischer Lloyd
Lloyd’s Register of Shipping
Bureau Veritas
Det Norske Veritas
 

--------------------------------------------------------------------------------

 
Exhibit A
 
FORM OF NOTICE OF BORROWING
 
[Date]
 
DnB Nor Bank ASA, New York Branch,
  as Administrative Agent for the Lenders party
   to the Credit Agreement
   referred to below
200 Park Avenue, 31st Floor
New York, New York  10166-0396

 
 
Attention:  [________]
 
Ladies and Gentlemen:
 
The undersigned, Genco Shipping & Trading Limited (the “Borrower”), refers to
the Credit Agreement, dated as of July __, 2007 (as amended, restated, modified
and/or supplemented from time to time, the “Credit Agreement,” the terms defined
therein being used herein as therein defined), among the Borrower, the lenders
from time to time party thereto (the “Lenders”), you, as Administrative Agent
and Collateral Agent for such Lenders, and hereby gives you notice, irrevocably,
pursuant to Section 1.03 of the Credit Agreement, that the undersigned hereby
requests a Borrowing under the Credit Agreement, and in that connection set
forth below the information relating to such Borrowing (the “Proposed
Borrowing”) as required by Section 1.03 of the Credit Agreement:
 
(i)           The Business Day of the Proposed Borrowing is ____________.1
 
(ii)           The aggregate principal amount of the Proposed Borrowing is
$____________.
 
(iii)           The initial Interest Period for the Proposed Borrowing is _____
[months(s)].2
 
 
 
 
 
____________________________________
1
Shall be a Business Day at least two Business Days after the date hereof,
provided that (in each case) any such notice shall be deemed to have been given
on a certain day only if given before 4:00 p.m. (New York time) on such day.

 
2
The initial Interest Period for any Loan shall commence on the date of the
Borrowing of such Loan and each Interest Period occurring thereafter in respect
of such Loan shall commence on the day on which the immediately preceding
Interest Period applicable thereto expires, and shall be a one, three, six or,
to the extent available and agreed by all Lenders, nine or twelve month period
or less than 30 days subject to approval of the Administrative Agent.

 
 
 
 

--------------------------------------------------------------------------------

 
 
  Exhibit A
  Page 2
 
(iv)           The proceeds of the Proposed Borrowing shall be used to
[refinance the Existing Credit Agreement] [acquire an Additional Vessel] [fund
working capital requirements of the Borrower and its Subsidiaries].
 
[[(v)]                      The aggregate amount of all Loans (determined on a
proforma basis giving effect to the Proposed Borrowing) used to fund working
capital requirements of the Borrower and its Subsidiaries is $__________, which
does not exceed $50 million.]3
 
[(v)][(vi)]                      The proceeds of the Proposed Borrowing shall be
deposited in the following account:  Account No. [________________], Account
Name [________________].
 
[(vi)] [(vii)]                               The Aggregate Appraised Value shall
be at least 130% of the aggregate amount of all Loans and the Letter of Credit
Outstandings (determined on a proforma basis giving effect to the Proposed
Borrowing).
 
The undersigned hereby certifies on behalf of the Borrower that the following
statements are true on the date hereof, and will be true on the date of the
Proposed Borrowing:
 
(A)           the representations and warranties made by each Credit Party in or
pursuant to the Credit Documents shall be true and correct in all material
respects, on and as of such date of the Proposed Borrowing as if made on and as
of the date of the Proposed Borrowing, unless stated to relate to a specific
earlier date, in which case such representations and warranties shall be true
and correct in all material respects as of such earlier date;
 
(B)           all of the conditions set forth in Sections 5 and 6 of the Credit
Agreement have been satisfied and will be satisfied on the date of the Proposed
Borrowing; and
 
(C)           no Default or Event of Default shall have occurred and be
continuing on the date of the Proposed Borrowing or after giving effect to the
Proposed Borrowing made on such date.
 
Very truly yours,
 
 
GENCO SHIPPING & TRADING LIMITED

 
     By: ________________________
    Name:
    Title:
 
________________
3 To be inserted in the event that the Proposed Borrowing is being used to fund
working capital requirements of the Borrower and its Subsidiaries.
 
 
 
 
 
 

--------------------------------------------------------------------------------

      
                       Exhibit B      
      
           

FORM OF NOTE
 
$________                                                                                                                                                                                                        
New York, New York
[Date]
 
FOR VALUE RECEIVED, GENCO SHIPPING & TRADING LIMITED, a corporation organized
under the laws of the Republic of Marshall Islands (the “Borrower”), hereby
promises to pay to ____________ or its registered assigns (the “Lender”), in
lawful money of the United States of America in immediately available funds, at
the office of DNB NOR BANK ASA, New York Branch (the “Administrative Agent”)
located at 200 Park Avenue, 31st Floor, New York, NY 10166-0396, on the Maturity
Date (as defined in the Credit Agreement referred to below) the principal sum of
_____________ DOLLARS ($_____) or, if less, the then aggregate unpaid principal
amount of all Loans (as defined in the Credit Agreement) made by the Lender
pursuant to the Credit Agreement.
 
The Borrower also promises to pay interest on the unpaid principal amount hereof
in like money at said office from the date hereof until paid at the rates and at
the times provided in Section 1.07 of the Credit Agreement.
 
This Note is one of the Notes referred to in the Credit Agreement, dated as of
July __, 2007, among the Borrower, the lenders from time to time party thereto
(including, without limitation, the Lender) DnB Nor Bank ASA, New York Branch,
as Administrative Agent (as amended, restated, modified and/or supplemented from
time to time, the “Credit Agreement”), and is entitled to the benefits thereof
and of the other Credit Documents (as defined in the Credit Agreement).  This
Note is secured by the Security Documents (as defined in the Credit Agreement)
and is entitled to the benefits of the Subsidiaries Guaranty (as defined in the
Credit Agreement).  This Note is subject to voluntary prepayment and mandatory
repayment prior to the Maturity Date, in whole or in part, as provided in the
Credit Agreement.
 
If an Event of Default (as defined in the Credit Agreement) shall occur and be
continuing, the principal of and accrued interest on this Note may become or be
declared to be due and payable in the manner and with the effect provided in the
Credit Agreement.
 
The Borrower hereby waives presentment, demand, protest or notice of any kind in
connection with this Note.
 
 

--------------------------------------------------------------------------------

 
Exhibit B
Page 2
 

 
THIS NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH AND BE GOVERNED BY THE LAW OF
THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF LAW PRINCIPLES.
 
GENCO SHIPPING & TRADING LIMITED
 
By ________________________
      Name:
      Title:
 

 

--------------------------------------------------------------------------------

 
Exhibit C-1
 
KRAMER LEVIN NAFTALIS & FRANKEL  LLP  

 

 
________ __, 2007
 
DnB NOR Bank ASA, as Administrative Agent
200 Park Avenue, 31st Floor
New York, NY 10166
 
Re:           Genco Shipping & Trading Limited
 
Ladies and Gentlemen:
 
We have acted as special New York counsel to Genco Shipping & Trading Limited, a
corporation incorporated under the laws of the Republic of the Marshall Islands
(the “Company”) and each of the Subsidiary Guarantors that is listed on Annex A
hereto (the “Subsidiary Guarantors” and together with the Company, the “Credit
Parties”) in connection with the Credit Agreement (the “Credit Agreement”),
dated as of July __, 2007, by and among the Company, the Lenders party thereto,
each of the Subsidiary Guarantors, and DnB NOR Bank ASA, acting through its New
York branch as administrative agent (in such capacity, the “Administrative
Agent”), as mandated lead arranger, as bookrunner, as security trustee and as
collateral agent (in such capacity, the “Collateral Agent”).  This opinion is
delivered pursuant to Section 5.04 of the Credit Agreement.  Capitalized terms
used but not defined herein have the meanings assigned to them in the Credit
Agreement.
 
In rendering this opinion, we have examined and relied upon executed copies of
those documents referenced in clauses (a) through (j) (collectively, those
documents referenced in clauses (a) through (e), the “Transaction Documents”):
 
(a)           the Credit Agreement;
 
(b)           the Note, dated as of July __, 2007, issued by the Company and
delivered to the Administrative Agent;
 
(c)           the Pledge and Security Agreement, dated as of July __, 2007,
among the Company, the Subsidiary Guarantors and the Administrative Agent, as
pledgee (the “Pledge Agreement”);
 
(d)           the Assignments of Purchase Contracts dated as of July __, 2007,
entered into by each Subsidiary Guarantor as is a party thereto (herein, an
“Assignor”) (the “Assignments of Purchase Contracts”);
 
(e)           the Guaranty dated as of July __, 2007 signed by each of the
Subsidiary Guarantors in favor of the Administrative Agent;
 
 
(f)
the Fee Letter;

 
 

--------------------------------------------------------------------------------

 
KRAMER LEVIN NAFTALIS & FRANKEL  LLP 
 
DnB NOR Bank ASA
________ ___, 2007
Page 2
 
 
(g)           each of the Assignments of Insurances, dated as of [         ] and
entered into by each Assignor as is a party thereto (the “Assignments of
Insurances”);
 
(h)           each of the Assignments of Charters, dated as of [          ] and
entered into by each Assignor as is a party thereto (the “Assignment of
Charters”);
 
(i)           each of the Assignments of Earnings, dated as of [         ] and
entered into by each Assignor as is a party thereto (the “Assignments of
Earnings”); and
 
(j)           each of the Assignments of Construction Contracts and Refund
Guarantees, dated as of [           ] and entered into by each Assignor as is a
party thereto (the “Assignments of Construction Contracts” and together with the
Assignments of Purchase Contracts, the Assignments of Insurances, the
Assignments of Charters and the Assignments of Earnings, the “Assignments”);
 
We have also reviewed such other documents and made such other investigations as
we have deemed appropriate.  As to various questions of fact material to this
opinion, we have relied upon the representations and warranties of the Credit
Parties contained in the Credit Agreement and the Pledge Agreement and upon the
statements, representations and certificates of officers or representatives of
the Credit Parties, public officials and others.  We have not independently
verified the facts so relied on.
 
Based on the foregoing, and subject to the qualifications, limitations and
assumptions set forth herein, we are of the opinion that:
 
1.  
Each of the Transaction Documents constitutes a valid and binding obligation of
the Credit Parties, enforceable against the Credit Parties in accordance with
its terms.

 
2.  
The execution and delivery by the Credit Parties of the Transaction Documents
and the consummation by the Credit Parties of the transactions contemplated
thereby do not result in the violation of any Relevant Law (as hereinafter
defined).

 
3.  
The execution and delivery by the Credit Parties of the Transaction Documents
and the consummation by the Credit Parties of the transactions contemplated
thereby do not require approval from or any filings with any governmental
authority under any Relevant Law other than the filing of financing statements
under the Uniform Commercial Code.

 
4.  
Each of the Pledge Agreement and the Assignments are sufficient to create in
favor of the Collateral Agent a security interest in those items and types of
Collateral described therein in which a security interest can be created under
Article 9 of the Uniform Commercial Code as in effect in the State of New York
(the “New York UCC”).

 
5.  
No Credit Party is an “investment company” within the meaning of the Investment
Company Act of 1940, as amended.

 
 

--------------------------------------------------------------------------------

 
KRAMER LEVIN NAFTALIS & FRANKEL  LLP 
 
DnB NOR Bank ASA
________ ___, 2007
Page 3
 
 
6.  
The Collateral Agent’s security interest in the issued and outstanding capital
stock of the Subsidiary Guarantors, represented by the stock
certificates identified in Annex C (“List of Stock”) to the Pledge Agreement and
Annex B hereto (the “Certificated Securities”) will be perfected upon delivery
to the Collateral Agent in the State of New York of the certificates
representing such Certificated Securities together with the executed and undated
stock powers and endorsed instruments of assignment and transfer.  This opinion
in paragraph 6 assumes that the Certificated Securities constitute “securities”
within the meaning of the New York UCC.

 
7.  
The financing statements on Form UCC-1, copies of which are attached hereto as
Annex C (the “Financing Statements”), are in appropriate form for filing with
the Department of State of the State of New York under the New York UCC.  The
financing statements on Form UCC-1, copies of which are attached hereto as Annex
C-2 (the "DC Financing Statements"), are in appropriate form for filing with the
Recorder of Deeds of the District of Columbia under the Uniform Commercial code
as in effect in the District of Columbia (the "DC UCC").  The security interest
created in favor of the Collateral Agent by the Pledge Agreement and the
Assignments in those items and types of Collateral described in the Pledge
Agreement and the Assignments, in each case, in which a security interest may be
perfected by the filing of a financing statement under the New York UCC will be
perfected upon the filing of the NY Financing Statements with the Department of
State of the State of New York and the DC Financing Statements with the Recorder
of Deeds of the District of Columbia, in each case, together with the payment of
any requisite filing or recording fees.

 
8.
The Collateral Agent’s security interest in the Operating Accounts (as defined
in the Pledge Agreement) will be perfected upon the execution and delivery by
the Depositary Bank, the Company, each Subsidiary Guarantor listed in Annex A
hereto and the Collateral Agent of the Control Agreement wherein the Depositary
Bank agrees that it will comply with instructions originated by the Collateral
Agent directing disposition of the funds in the Operating Accounts without
further consent by the Company or any Subsidiary Guarantor.  Under the New York
UCC, such security interest has priority over any other security interests in
the Operating Accounts.  The opinion expressed in this paragraph 8 assumes that
no person other than the Collateral Agent has control over the Operating
Accounts on the date hereof and we express no opinion as to any security
interest claimed by the Depositary Bank in the Operating Accounts.

 
The opinion set forth herein is subject to and limited by the following:
 
(a)  The opinion set forth in paragraphs 1, 4, 6, 7 and 8 is qualified (i) by
the effects of applicable laws relating to bankruptcy, insolvency, fraudulent
conveyance or transfer, and other similar laws relating to or affecting the
rights and remedies of creditors generally, (ii) with respect to the remedies of
specific performance and injunctive and other forms of equitable relief, by the
availability of equitable defenses and the discretion of the court before which
any enforcement thereof may be brought and (iii) by general principles of
equity, including, without
 
 

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KRAMER LEVIN NAFTALIS & FRANKEL  LLP 
 
DnB NOR Bank ASA
________ ___, 2007
Page 4
 
 
limitation, concepts of materiality, reasonableness, good faith and fair dealing
(regardless of whether considered in a proceeding in equity or at law).
 
(b)  We express no opinion as to the validity, binding effect or enforceability
of (i) provisions that purport to establish evidentiary standards, (ii)
provisions relating to severability, indemnity, contribution, set off, delay or
omission of enforcement of rights or remedies, (iii) provisions purporting to
waive rights or defenses, (iv) provisions that purport to restrict available
remedies or establish remedies, (v) provisions relating to consent to
jurisdiction, choice of forum or choice of law, or (vi) any provision if and to
the extent that such provision (x) is a liquidated damages provision or (y)
provides a remedy for breach that may be deemed to be disproportionate to actual
damages or may be deemed to be a penalty.
 
(c)  We express no opinion with respect to any matters which require us to
perform a mathematical calculation or make a financial or accounting
determination.  Without limiting the forgoing, we express no opinion with
respect to the Credit Parties’ compliance with any financial covenants set forth
in the Transaction Documents.
 
(d)  The opinion in paragraphs 4 and 8 is limited to Article 9 of the New York
UCC.  The opinion in paragraph 6 is limited to Articles 8 and 9 of the New York
UCC.  The opinion in paragraph 7 is limited to Article 9 of the New York UCC and
Article 9 of the DC UCC (but based solely on our review thereof as set forth in
the CCH Secured Transaction Guide).
 
(e)  Certain of the remedial provisions in the Pledge Agreement may be further
limited or rendered unenforceable by applicable law, but in our opinion, subject
to exceptions (a) and (b) above, such law does not make the remedies afforded by
the Transaction Documents inadequate for the practical realization of the
principal benefits intended to be provided.
 
(f)  We express no opinion as to the limitations contained in the federal
Bankruptcy Code upon the extent to which property acquired after the
commencement of a case under the federal Bankruptcy Code may be subjected to a
security interest arising from an agreement entered into prior to the
commencement of such case.
 
(g)  With respect to the opinion expressed in paragraph 1, we have assumed that
each party to the Transaction Documents: (i) is validly existing and in good
standing under the laws of its jurisdiction or organization, and (ii) has the
power to execute and consummate their respective obligations under the
Transaction Documents; and (iii) has duly authorized, executed and delivered the
Transaction Documents.  With respect to the opinion expressed in paragraph 1, we
have also assumed that the Transaction Documents constitute the valid and
binding obligation of such party other than the Credit Parties, enforceable
against such party in accordance with its terms.
 
We express no opinion as to any laws other than the laws of the State of New
York, and the federal laws of the United States of America, that in each case,
in our experience,
 
 
 

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KRAMER LEVIN NAFTALIS & FRANKEL  LLP 
 
DnB NOR Bank ASA
________ ___, 2007
Page 5
 
 
we recognize are normally applicable to transactions of the type contemplated by
the Transaction Documents (the “Relevant Laws”).  Without limiting the
foregoing, we express no opinion with respect to federal or state securities
laws or antitrust laws.
 
The opinion expressed herein is based upon the Relevant Laws and interpretations
thereof in effect on the date hereof, and the facts and circumstances in
existence on the date hereof, and we assume no obligation to revise or
supplement this opinion letter should any such law or interpretation be changed
by legislative action, judicial decision or otherwise or should there be any
change in such facts or circumstances.
 
This opinion letter is being delivered to you in connection with the
transactions described in the Transaction Documents and may not be relied on or
otherwise used by any other Person or by you for any other purpose.
 
Very truly yours,

Kramer Levin Naftalis & Frankel LLP

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KRAMER LEVIN NAFTALIS & FRANKEL LLP   
    

ANNEX A
 
SUBSIDIARY GUARANTORS
 
1.  
Genco Augustus Limited

2.  
Genco Tiberius Limited

3.  
Genco London Limited

4.  
Genco Titus Limited

5.  
Genco Constantine Limited

6.  
Genco Hadrian Limited

7.  
Genco Commodus Limited

8.  
Genco Maximus Limited

9.  
Genco Claudius Limited

 

 

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KRAMER LEVIN NAFTALIS & FRANKEL LLP              
    
 

 
 
ANNEX B

 
CERTIFICATED SECURITIES
 
1.  
Genco Augustus Limited                                                         
        (Certificate No. 1)

2.  
Genco Tiberius
Limited                                                                   
 (Certificate No. 1)

3.  
Genco London
Limited                                                                     
(Certificate No. 1)

4.  
Genco Titus
Limited                                                                          (Certificate
No. 1)

5.  
Genco Constantine
Limited                                                              (Certificate
No. 1)

6.  
Genco Hadrian
Limited                                                                    
 (Certificate No. 1)

7.  
Genco Commodus
Limited                                                                (Certificate
No. 1)

8.  
Genco Maximus
Limited                                                             
      (Certificate No. 1)

9.  
Genco Claudius
Limited                                                               
     (Certificate No. 1)

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 KRAMER LEVIN NAFTALIS & FRANKEL LLP              
    

ANNEX C
 
NEW YORK FINANCING STATEMENTS
 

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             EXHIBIT C-2      
    

REEDER & SIMPSON P.C.
ATTORNEYS AT LAW

P.O. Box 601
RRE Commercial Center
Majuro, MH 96960

Telephone: 011-692-625-3602
Facsimile: 011-692-625-3603
Email: dreeder@ntamar.net
 simpson@otenet.gr

 
DnB NOR BANK ASA (“DnB”)
New York Branch
200 Park Avenue, 31st Floor
New York, New York 10166-0396

July ___ , 2007

Re: Genco Shipping & Trading Limited (the “Company”)

Ladies and Gentlemen:

We are licensed to practice law in the Republic of the Marshall Islands (the
"RMI"),  and are members in good standing of the Bar of the RMI.  We are acting
as special RMI counsel on issues of RMI law for the Company and those of its
subsidiaries as listed on the attached Schedule 1 (collectively the “Subsidiary
Guarantors”), all of which are RMI non-resident domestic corporations, in
connection with that certain credit facility agreement dated as of July __,
2007, by and among the Company, the Lenders party thereto (the “Lenders”), DnB
NOR ASA, New York Branch, as Administrative Agent, Collateral Agent and Joint
Lead Arranger (the “Credit Agreement”).  This opinion is delivered pursuant to
Section [    ] of the Credit Agreement.  Capitalized terms used but not defined
herein have the meanings assigned to them in the Credit Documents (as defined in
the Credit Agreement).

 In connection with this opinion, we have examined electronic copies of the
following:

1.  the Credit Agreement;

2.  the Note, dated as of July__, 2007, issued by the Company and delivered to
the Administrative Agent;

3.  the Pledge and Security Agreement, dated as of July __, 2007, among the
Company, the Subsidiary Guarantors named therein and the Collateral Agent as
pledgee (the “Pledge Agreement”);

4.  the Guaranty, dated as of July __, 2007, made by the Company’s Subsidiary
Guarantors named therein in favor of the Collateral Agent ;
 
 

--------------------------------------------------------------------------------

 

 
5.  [The Marshall Islands Vessel Mortgages, dated as of [         ] and entered
into by each Subsidiary Guarantor which owns a mortgaged vessel, as mortgagor,
as is a party thereto (the “Vessel Mortgages”);]

6.  [the Assignments of Earnings, dated as of [         ] and entered into by
each Subsidiary Guarantor which owns a mortgaged vessel (herein, the “Assignor”)
as is a party thereto (the “Assignments of Earnings”);]

7.  [the Assignments of Insurances, dated as of [         ] and entered into by
each Assignor as is a party thereto (the “Assignments of Insurances”);]

8.  [the Assignments of Charters, dated as of [          ] and entered into by
each Assignor as is a party thereto (the “Assignment of Charters”);]

9.  [the Assignments of Purchase Contracts, dated as of [           ] and
entered into by each Assignor as is a party thereto (the “Assignments of
Purchase Contracts”);]

10.  [the Assignments of Construction Contracts and Refund Guarantees, dated as
of [          ] and entered into by each Assignor as is a party thereto (the
“Building Assignments”, and, together with the Assignments of Insurance, and the
Assignments of Charters, the Assignments of Earnings and the Assignments of
Purchase Contracts, the “Assignments”, and collectively with the Pledge
Agreement, the “Security Documents”); and]

11.  The articles of incorporation and by laws of the Company and each of the
Subsidiary Guarantors, resolutions of the Board of Directors of the Company and
each of the Subsidiaries, and a certificate of good standing for the Company and
each of the Subsidiary Guarantors.

The documents listed in paragraphs [                         ] are collectively
referred to as the “Transaction Documents”.

Unless otherwise indicated, capitalized terms used herein but not otherwise
defined herein shall have the respective meanings set forth in the Credit
Facility.

We have also made such examinations of matters of law as we deem necessary in
connection with the opinions expressed herein.  In rendering this opinion, we
have examined and relied upon originals or copies of Transaction Documents and
all such other documents, affidavits, corporate records, or certificates or
other statements of RMI government officials and officers of the Company and
such other instruments as we have considered necessary and appropriate.

Whenever our opinion is indicated to be based on our knowledge or awareness, it
is intended to signify that we have not undertaken any independent investigation
specifically for the purpose of rendering this opinion other than those
procedures referred to herein and our knowledge will be limited to those matters
of which we have actual knowledge.  Whenever we have stated that we have assumed
any matter, it is intended that we assume such matter without
 
 
 
2

--------------------------------------------------------------------------------

 
 
making any factual, legal, or other inquiry or investigation and without
expressing any opinion or conclusion of any kind concerning such matter.

In rendering this opinion we have assumed with your permission and without
independent verification:

1. The genuineness of all signatures, the legal capacity of natural persons and
of all parties which are not RMI entities, the authenticity of all items
submitted to us, and the conformity with originals of all items submitted to us
as copies, facsimile, electronic, or otherwise.  We assume that when the
parties, other than the Company,  executed and delivered the Transaction
Documents, along with all other agreements, instruments, associated documents,
and resolutions, that such parties were duly organized, validly existing, and in
good standing under the laws of their respective jurisdictions, that such
parties were duly qualified to engage in the transactions covered by this
opinion, that such parties had the power and authority to enter into and perform
their obligations thereunder, that such parties had duly authorized, executed
and delivered the Transaction Documents, that the Transaction Documents
constitute the legal, valid, and binding obligations of such parties, that the
due authorization, execution, enforceability and delivery of the Transaction
Documents complies with all relevant laws other than the laws of the RMI which
are the subject of this opinion, and that all actions required to be taken by
such parties have been duly accomplished including all conditions precedent; and

2.  The truth, accuracy, and completeness of all representations and warranties
in the Transaction Documents as to factual matters but not as to conclusions of
law that are the subject of this opinion letter.

We express no opinion as to matters governed by, or the effect or applicability
of any laws of any jurisdiction other than the laws of the RMI which are in
effect as of the date hereof.  This opinion speaks as of the date hereof, and it
should be recognized that changes may occur after the date of this letter which
may affect the opinions set forth herein.  We assume no obligation to advise the
parties, their counsel, or any other party seeking to rely upon this opinion, of
any such changes, whether or not material, or of any other matter which may
hereinafter be brought to our attention.

This opinion is furnished solely for your benefit, the benefit of your
successors, assigns, and participants and may not be used for any other purpose
or relied upon by, nor copies delivered to, any other persons without our prior
written consent in each case.

Based upon and subject to the assumptions, qualifications and limitations
herein, we are of the opinion that:

1.  The Company and each of the Subsidiary Guarantors are non-resident domestic
corporations duly organized and incorporated and validly existing and in good
standing under the laws of the RMI.
 
 
 
3

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2.  The execution, delivery and performance by the Company or the Subsidiary
Guarantors of the Transaction Documents to which it is a party, is within its
corporate powers and has been duly authorized by all necessary corporate action.

3.  Each of the Transaction Documents to which the Company or any of the
Subsidiary Guarantors is a party constitutes upon execution and delivery thereof
legal, valid and binding obligations of the Company and each such Subsidiary
Guarantors, enforceable against each of them in accordance with their respective
terms.

4.  Under RMI conflict of laws principles, the stated choice of New York law to
govern the Transaction Documents will be honored by the courts of the RMI and
the Transaction  Documents will be construed in accordance with, and will be
treated as being governed by, the law of the State of New York. However, if the
Transaction Documents were stated to be governed by and construed in accordance
with the law of RMI, or if a RMI court were to apply the law of the RMI to the
Transaction Documents, each Transaction Document would constitute the legal,
valid and binding obligation of the Company, enforceable against it in
accordance with its terms, except as may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws relating to or affecting the
rights of creditors generally.

5.  To ensure the validity and enforceability of the Transaction Documents in
the RMI, it is not necessary[, except for the Mortgage,] that they be registered
in any register kept by, or filed with, or recorded or notarized in any
governmental authority or regulatory body in the RMI, or that any other
instrument relating thereto be signed, delivered, filed, registered or recorded
or that any tax or duty be paid or any other action whatever be taken in the
RMI.  No authorization, approval or consent of any governmental or regulatory
authority or agency of the RMI is required on the part of the Company or any of
the Subsidiary Guarantors for the execution, delivery or performance of the
Transaction Documents.

6.  The execution, delivery and performance by the Company or any of the
Subsidiary Guarantors of and the consummation by the Company or any of the
Subsidiary Guarantors of the transactions contemplated by each of the
Transaction Documents do not and will not (a) violate the organizational
documents of the Company or any of the Subsidiary Guarantors, (b) violate any
applicable RMI law, rule or regulation of general application to which the
Company or any of the Subsidiary Guarantors is subject, or (c) violate any RMI
order, writ, injunction or decree of any court or governmental authority or
agency or any arbitral award applicable to the Company or any of the Subsidiary
Guarantors.

7.  We have no knowledge (after due inquiry) of any legal or arbitral
proceedings, or any proceedings by or before any RMI governmental or regulatory
authority or agency, now pending or threatened against the Company or any of the
Subsidiary Guarantors or any of their properties.
 
 
4

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8.  On the basis of our searches of RMI Registrar of Corporations and RMI High
Court docket records, no currently valid order or resolution for winding up of
the Company or any of the Subsidiary Guarantors and no current notice of
appointment of a receiver over the Company or any of the Subsidiary Guarantors
or of their assets appears on the records maintained in respect of the Company
or the Subsidiary Guarantors by the RMI Registrar of Corporations.

9.  The laws of the RMI currently do not generally require information
concerning the existence of a nonpossessory security interest to be made
generally available in a filing, recording or registration system as a condition
or result of the security interest’s obtaining priority over the rights of a
lien creditor with respect to the collateral.

10.  A judgment of obtained against the Company in the United States District
Court for the Southern District of New York or any New York State court sitting
in New York City would be given full faith and credit by the Courts of RMI.

11.  No stamp duty or similar or other tax or duty is payable in the RMI on the
enforcement of a foreign judgment.  No tax is required to be withheld by any
governmental authority in the RMI with respect to any payments made under any of
the Transaction Documents.

Sincerely,

Reeder & Simpson PC
Dennis J. Reeder

5

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SCHEDULE 1. - THE SUBSIDIARIES

 
Name of Subsidiary
 
Direct Owner(s)
Percent(%)
Ownership
Jurisdiction of
Organization
Genco Acheron Limited
Genco Shipping & Trading Limited
100%
Marshall Islands
Genco Commander Limited
Genco Shipping & Trading Limited
100%
Marshall Islands
Genco Surprise Limited
Genco Shipping & Trading Limited
100%
Marshall Islands
Genco Muse Limited
Genco Shipping & Trading Limited
100%
Marshall Islands
Genco Pioneer Limited
Genco Shipping & Trading Limited
100%
Marshall Islands
Genco Carrier Limited
Genco Shipping & Trading Limited
100%
Marshall Islands
Genco Explorer Limited
Genco Shipping & Trading Limited
100%
Marshall Islands
Genco Vigour Limited
Genco Shipping & Trading Limited
100%
Marshall Islands
Genco Wisdom Limited
Genco Shipping & Trading Limited
100%
Marshall Islands
Genco Success Limited
Genco Shipping & Trading Limited
100%
Marshall Islands
Genco Sugar Limited
Genco Shipping & Trading Limited
100%
Marshall Islands
Genco Beauty Limited
Genco Shipping & Trading Limited
100%
Marshall Islands
Genco Knight Limited
Genco Shipping & Trading Limited
100%
Marshall Islands
Genco Reliance Limited
Genco Shipping & Trading Limited
100%
Marshall Islands
Genco Trader Limited
Genco Shipping & Trading Limited
100%
Marshall Islands
Genco Prosperity Limited
Genco Shipping & Trading Limited
100%
Marshall Islands
Genco Progress Limited
Genco Shipping & Trading Limited
100%
Marshall Islands
Genco Marine Limited
Genco Shipping & Trading Limited
100%
Marshall Islands
Genco Leader Limited
Genco Shipping & Trading Limited
100%
Marshall Islands
Genco Ship Management LLC
Genco Shipping & Trading Limited
100%
Delaware

6

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SCHEDULE 2. - THE LENDERS
 
 
DnB NOR BANK ASA, NEW YORK BRANCH
 
 
 
 
 
 

7

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        EXHIBIT C-3      
    

 
Constantine P. Georgiopoulos
 
Attorney-At-Law
 
35 West 56th Street
 
New York, NY 10019
 
E-Mail:  Pamisos@Att.Net
 
 
_______, 200_
 
DnB Nor Bank ASA, New York Branch,
as Administrative Agent, Collateral Agent,
and Joint Lead Arranger
200 Park Avenue
New York, New York 10166
 
and
 
the Lenders listed on Schedule I hereto
 
Ladies and Gentlemen:
 
We have acted as special New York maritime counsel to Genco Shipping & Trading
Limited, a Marshall Islands corporation (the “Company”) and each wholly owned
subsidiary of the Company listed on Schedule II hereto (collectively, the
“Subsidiary Guarantors” and each a “Subsidiary Guarantor”) in connection with
the Credit Agreement, dated as of July __, 2007, by and among the Company, the
Lenders party thereto (the “Lenders”), DnB NOR ASA, New York Branch, as
Administrative Agent, Collateral Agent and Joint Lead Arranger (the “Credit
Agreement”).  This opinion is delivered pursuant to Section [    ] of the Credit
Agreement.  The Company and the Subsidiary Guarantors are collectively referred
to herein as the “Credit Parties” and each a “Credit Party.” This opinion is
delivered pursuant to Section [     ] of the Credit Agreement.  Capitalized
terms used but not defined herein have the meanings assigned to them in the
Credit Documents (as defined in the Credit Agreement) in connection with the
Credit Agreement and the Security Documents (as hereinafter defined).
 
In connection with this opinion, we have examined the (i) Credit Agreement, (ii)
the Note, dated as of July__, 2007, issued by the Company and delivered to the
Administrative Agent, (iii) the Pledge and Security Agreement, dated as of July
__, 2007, among the Company, the Subsidiary Guarantors named therein and the
Collateral Agent as pledgee (the “Pledge Agreement”) and (iv) the Guaranty,
dated as of July __, 2007, made by the Subsidiary Guarantors named therein in
favor of the Collateral Agent.  We have also examined the following documents
(together with (i) thru (iv) above, the “Security Documents”) each dated July
29, 2005 executed and delivered by each Subsidiary Guarantor, as we have deemed
necessary or appropriate as a basis for the opinions set forth herein:
 
(a)  [the First Priority Statutory Mortgages and Deed of Covenants collateral
thereto dated as of [         ] and entered into by each Subsidiary Guarantor
which owns a
 
 
 

--------------------------------------------------------------------------------

 
 
mortgaged vessel (the “Vessel Mortgage”) for the purpose of creating a mortgage
lien on each Mortgaged Vessel owned by such Subsidiary Guarantor as described in
Schedule II;]
 
(b)  [the Assignments of Earnings, dated as of [         ] and entered into by
each Subsidiary Guarantor which owns a Mortgaged Vessel (the “Assignments of
Earnings”);]
 
(c)  [the Assignments of Insurances, dated as of [         ] and entered into by
each Subsidiary Guarantor which owns a Mortgaged Vessel (herein, an “Assignor”)
(the “Assignments of Insurances”);]
 
(d)  [the Assignments of Charters, dated as of [          ] with respect to each
Mortgaged Vessel and entered into by each Subsidiary Guarantor as is a party
thereto (the “Assignment of Charters”);]
 
(e)  [the Assignments of Purchase Contracts, dated as of [           ] and
entered into by each Subsidiary Guarantor as is a party thereto (the
“Assignments of Purchase Contracts”);]
 
(f)  [the Assignments of Construction Contracts and Refund Guarantees, dated as
of [          ] and entered into by each Subsidiary Guarantor as is a party
thereto (the “Building Assignments”, and, together with the Assignments of
Insurance, and the Assignments of Charters, the Assignments of Earnings and the
Assignments of Purchase Contracts, the “Assignments”, and collectively with the
Pledge Agreement, the “Security Documents”);]
 
(g)  UCC-1 Financing Statements to be filed in the filing offices listed on
Schedule III hereto (the “Filing Offices”), copies of which are attached hereto
as Schedule IV and Schedule V and (collectively, the “Financing Statements”).
 
(h)  a facsimile copy of a Transcript of Register relating to each Mortgaged
Vessel described on Schedule II issued by the Marine Department (the “Ship
Registry Office”), of the Hong Kong Special Administrative Region of the
People's Republic of China (“Hong Kong”), on July 30, 2005 as evidence that each
Mortgaged Vessel is (i) owned by the respective Subsidiary Guarantor on Schedule
II, (ii) duly registered in Hong Kong and (iii) duly encumbered with a Vessel
Mortgage.
 
We also have examined such other public and corporate documents and records and
such laws, regulations and enactments of the United States of America and the
State of New York as deemed necessary or appropriate in connection with this
opinion.
 
In our examination we have assumed the genuineness of all signatures (other than
the signatures of the respective officers and directors and of the Credit
Parties), the authenticity of all documents submitted to us as originals, the
conformity to original documents of all documents submitted to us as certified
or photographic reproductions or facsimile or pdf copies of such originals and
the authenticity of the originals of such copies.  As to questions of fact not
independently verified by us we have relied, to the extent we have deemed
appropriate, upon certificates of the respective officers, and directors of the
Credit Parties.  We have been provided
 
 
 
2

--------------------------------------------------------------------------------

 
 
 
 
with copies of documents of public officials of the Republic of the Marshall
Islands (“RMI”) and the aforementioned Transcript of Registry relating to each
Mortgaged Vessel which we assume are authentic and accurate insofar as the
information contained therein.
 
A.  We have made the following assumptions that apply to the Subsidiary
Guarantors:
 
1.  Each of the Subsidiary Guarantors (i) is a corporation duly organized and
incorporated or formed and validly existing and in good standing under the laws
of the RMI, (ii) has all the corporate or company power and authority to own its
property and assets and to transact the business in which it is engaged and
presently proposes to engage in and to enter into and perform its respective
obligations under the Security Documents to which it is a party, and (iii) is
duly qualified and is authorized to do business and is in good standing in each
jurisdiction where the conduct of its business required such qualification
except for failures to be so qualified which, either individually or in the
aggregate, could not reasonably be expected to have a Material Adverse Effect.
 
2.  Each of the Subsidiary Guarantors has the corporate or company power and
authority to execute, deliver and perform the terms and provisions of the
Security Documents, as and when such Security Documents will be executed and
delivered, to which it is a party and has taken all necessary corporate or
company action to authorize the execution, delivery and performance by it of
each of such Security Documents.  Each of the Subsidiary Guarantors has duly
executed and delivered each of the Security Documents to which it is a party
which are required of such Subsidiary Guarantor as of the date hereof, and each
of the executed Security Documents to which it is a party constitutes the legal,
valid and binding obligation of each of the Subsidiary Guarantors.
 
3.  Neither the execution, delivery or performance by any of the Subsidiary
Guarantors of the Security Documents to which it is a party (including, without
limitation, the granting of Liens pursuant to the Security Documents), nor
compliance by it respectively with the terms and provisions thereof as of the
date of the execution and delivery to you of such Security Documents (i) will
contravene any provisions of any applicable RMI or Hong Kong statute, rule or
regulation (ii) will contravene any provision of any applicable RMI or Hong Kong
order, writ, injunction or decree of any RMI or Hong Kong court or governmental
instrumentality applicable to any of the Subsidiary Guarantors, (iii) will be
inconsistent with or result in any breach of any of the terms, covenants,
conditions or provisions of, or constitute a default under, or result in the
creation or imposition of (or the obligation to create or impose) any Lien
(except pursuant to the Credit Documents) upon any of the property or assets of
the Subsidiary Guarantors pursuant to the terms of any indenture, mortgage, deed
of trust, credit agreement or loan agreement, or any other material agreement or
instrument to which any of the Subsidiary Guarantors is a party or by which it
any of its property or assets is bound or to which it may be subject or
(iv) with respect to the Subsidiary Guarantors only will violate any provision
of the certificate or articles of incorporation or by-laws of any of the
Subsidiary Guarantors.
 
4.  Except as noted in paragraphs B(5) hereunder, no RMI or Hong Kong order,
consent, approval, license, authorization, or validation of, or filing,
recording or registration with, or exemption by any RMI or Hong Kong
governmental or public body or authority, or any subdivision thereof, is
required to authorize, or is required in
 
 
 
3

--------------------------------------------------------------------------------

 
 
 connection with: (i) the entry into, execution, delivery and performance of any
Security Documents or (ii) the legality, validity, binding effect or
enforceability of any such Security Documents, except (a) for the registration
of the Vessel Mortgages at the Ship Registry Office, and (b) the compliance with
certain filing or registration requirements mandated by Hong Kong law within
five weeks of the creation of a security interest.
 
B.  We have made the following assumptions with respect to the Vessels which are
documented at the Ship Registry Office:
 
1.  It is not necessary or advisable, in order to maintain any Vessel Mortgage
as a valid first preferred ship mortgage, that any Subsidiary Guarantor file any
of the Security Documents or any other instrument relating thereto with any Hong
Kong, court, agency or governmental instrumentality except for the recording of
a Vessel Mortgage at the Ship Registry Office.
 
2.  All permits, licenses, consents, and approvals of any Hong Kong governmental
authority as a condition to the validity and enforceability of the registration
of each Vessel registered in Hong Kong and each Vessel Mortgages, have been duly
obtained, are in full force and effect as of the date thereof and are valid and
sufficient for their respective purposes.
 
3.  Each Vessel is duly registered under the laws and flag of Hong Kong at the
Ship Registry Office in the name of the respective Subsidiary Guarantor, free of
any liens, claims, charges, debts or encumbrances other than the Vessel
Mortgage.
 
4.  The Ship Registry Office is a central office within the meaning of Section
31301(6) (B) of Title 46 of the United States Code.
 
5.  Each Vessel Mortgage (i) has been duly executed and delivered, (ii) has been
duly recorded at the Ship Registry Office, (iii) constitutes and will constitute
a valid and binding first preferred mortgage lien upon each respective Mortgaged
Vessel securing the “Indebtedness hereby secured” as defined therein, with
effect and priority from the date and time of recording pursuant to the laws of
Hong Kong, (iv) is or will be enforceable in accordance with each of their
terms, all in accordance with the laws of Hong Kong governing ship mortgages,
and the performance of the Vessel Mortgages and will not violate or conflict
with any Hong Kong law, statutes or regulations, and (v) will maintain their
validity and priority and without it being necessary or appropriate for it to be
re-recorded or re-filed.
 
6.  Under the laws of the RMI and Hong Kong the choice of New York law to govern
the Security Documents (other than the Vessel Mortgages) by the parties thereto
is a valid choice of law, and the submission to the jurisdiction of the courts
of the State of New York, located in New York City, or of the United States for
the Southern District of New York is valid and binding upon the parties.
 
Subject to the foregoing assumptions we are of the opinion, with respect to the
Subsidiary Guarantors as the owner of the respective Mortgaged Vessels, that:
 
 
 
 
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1.  The Subsidiary Guarantors are each corporations duly organized and validly
existing and in good standing under the laws of the RMI.
 
2.  The Subsidiary Guarantors have the power and authority to enter into,
observe and perform the terms and obligations on its part to be observed and
performed under the Security Documents to which each is a party and have taken
all necessary corporate or company action to authorize the execution and
delivery of the Security Documents and the performance of its obligations in
accordance with their terms.
 
3.  Each Vessel Mortgage constitutes the equivalent of a “preferred mortgage”
within the meaning of Section 31301(6)(B) of Title 46 of the United States Code,
entitled to the benefits accorded a preferred mortgage on a foreign registered
vessel under Sections 31325 and 31326 of Title 46 of the United States Code and
(ii) perfects the rights of the Collateral Agent, as assignee, under the
Assignments of Insurances respecting the Mortgaged Vessels.
 
Subject to the foregoing we are of the further opinion, with respect to the
Assignments of Insurances and the Assignments of Earning:
 
1.  The rights of the Collateral Agent, as assignee, under the Assignments of
Insurances granted by the Subsidiary Guarantors is, or will be, perfected by
(i) the recording of the Vessel Mortgages at the Ship Registry Office, and
(ii) the giving of notice to, and consent of, underwriters where policy
provisions so provide and (iii) the compliance with any filing or registration
requirements mandated by Hong Kong law.  Nevertheless, we recommend that
precautionary Financing Statements should be filed at the Office of the New York
Secretary of State and the Recorder of Deeds, Washington, D.C. (the “Filing
Offices”) with respect to such Assignments of Insurances.
 
2.  We have examined the Financing Statements to be filed in the Filing Offices
for the Subsidiary Guarantor, and upon the filing of such Financing Statements
in the Filing Offices, the security interests granted by the Subsidiary
Guarantors to the Collateral Agent under the Assignments of Earnings and the
Assignments of Charter in respect of all such Collateral thereunder will
constitute a perfected security interest therein in favor of the Collateral
Agent in each case to the extent that such earnings consists of the type of
property in which a security interest may be perfected by filing a financing
statement under the UCC, subject to the giving of notice to any relevant debtor.
 
The opinions set forth herein are subject to and limited by the following:
 
A.  The effect of bankruptcy, insolvency, reorganization, fraudulent conveyance,
fraudulent transfer, moratorium and other laws and court decisions or other
legal or equitable principles relating to, limiting or affecting the enforcement
of creditors' rights generally.
 
B.  The discretion of any court of competent jurisdiction in awarding equitable
remedies (regardless of whether considered in a proceeding in equity or at law),
including, but not limited to, specific performance or injunctive relief.
 
 
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C.  The enforceability of the Security Documents may be subject to:
(i) compliance with, and limitations imposed by, procedural requirements
relating to the exercise of remedies; (ii) general principles of equity
(including, but not limited to, commercial reasonableness, good faith and fair
dealing and the requirement that the right, remedy, damages or compensation
sought be proportionate to the breach, default, or injury); (iii) provisions of
applicable law limiting certain rights and remedies of the Administrative Agent,
the Collateral Agent and the Lenders or the effect of certain waivers or
agreements, but the inclusion of such provisions in the Credit Documents does
not, in our opinion, render any Credit Documents invalid as a whole and, in our
opinion, subject to the limitations referred to in clause (A) above, the Credit
Documents contain adequate provisions for the practical realization by the
Administrative Agent, the Collateral Agent and the Lenders of the principal
benefits intended to be provided by the Credit Documents.
 
D.  We express no opinion with respect to the enforceability of (i) provisions
to the effect that failure to exercise or delay in exercising a right or remedy
will not operate as a waiver of the right or remedy or of provisions to the
effect that rights or remedies are not exclusive, that every right or remedy is
cumulative and may be exercised in addition to or with any other right or
remedy, or that the election of some particular right or rights or remedy or
remedies does not preclude recourse to one or more others; (ii) provisions
providing indemnification for or contribution with respect to securities law
liabilities, the enforceability of which may be limited by applicable securities
laws and general principles of public policy; (iii) provisions indemnifying a
person against or prospectively releasing a person from liability for such
person's own wrongful or negligent acts or where the release or indemnification
is contrary to public policy; (iv) provisions purporting to preclude the
modification of the Credit Documents through conduct, custom, or course of
performance, action or dealing; (v) provisions requiring the payment or
reimbursement of fees, costs, expenses, or other amounts without regard to
whether they are reasonable in nature or amount; (vi) provisions that purport to
establish evidentiary standards; or (vii) provisions purporting to appoint the
Collateral Agent as the attorney-in-fact of any Subsidiary Guarantor.
 
E.  We express no opinion as to the creation of Liens in governmental licenses,
permits and approvals.  The creation of such Liens may be limited, prohibited or
ineffective under applicable law or governmental policy.
 
F.  Any purported assignment of any agreement or any governmental approval,
license or permit may be subject to restrictions upon assignment or transfer
which, although not necessarily applicable to assignments intended as security,
may be required to be satisfied before the Collateral Agent will be treated as
an assignee thereof, except to the extent that consents to or approvals of such
assignment have been obtained from the appropriate governmental body or other
Person.
 
G.  We express no opinion as to any security interests relating to property in
which security interests cannot be granted under the UCC, or as to the
perfection of security interests granted by any Subsidiary Guarantor which may
be perfected by any means other than by filing a financing statement pursuant to
the UCC or, in the case of
 
 
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 instruments (as such term is defined in Section 9-102(a) (47) of the UCC), by
possession by the secured party.
 
H.  The perfection of security interests which are perfected by the filing of
financing statements is limited both in extent and as to continuation by various
provisions of the UCC, including, but not limited to, those relating to
non-identifiable or commingled cash proceeds and the need to file continuation
statements and/or new financing statements if the classification of any
Collateral under the UCC changes because of a change in the use of such
Collateral, or upon the lapse of time or if any Shipowners change its name,
identity, corporate structure or location of the chief executive office, chief
place of business or the places where it keeps the Collateral or its records
with respect thereto.
 
I.  We express no opinion as to the validity or legally binding effect of any
provision of any Document that requires or relates to payment of any interest at
a rate or in an amount, which a court would determine in the circumstances under
applicable law to be usurious, commercially unreasonable or a penalty or
forfeiture.
 
J.  We express no opinion as to the limitations contained in the Federal
Bankruptcy Code upon the extent to which property acquired after the
commencement of a case under the Federal Bankruptcy Code may be subjected to a
security interest arising from an agreement entered into prior to the
commencement of such case.
 
K.  As used in this opinion, “to our knowledge” or comparable terms means or
refers to the actual knowledge of the undersigned.  We have not, except as
otherwise set forth herein, undertaken any independent investigation to
determine the existence or absence of those matters, and no inference as to our
knowledge of the existence or absence of those matters should be drawn from our
representation of any Subsidiary Guarantor.
 
L.  We have no knowledge of Hong Kong law.  We are members of the Bar of the
State of New York and do not purport to be expert or express any opinion except
as to matters involving the laws of such State and the federal laws of the
United States of America.  We are not licensed to practice law in the Marshall
Islands, or Hong Kong.
 
M.  The enforcement of the Vessel Mortgages will be subject to the laws of any
jurisdiction where enforcement thereof may be sought.
 
We have assumed with your permission that no agreement or understanding exists
which would modify, supplement or amend any Security Document.  In addition, all
other matters stated in this opinion as having been assumed by us have been so
assumed with your permission.
 
The opinions expressed herein is based upon the laws and interpretations in
effect on the date hereof, and we assume no obligations to review or supplement
this opinion letter should any such law be changed by legislative action,
judicial decision or otherwise.  In addition, we do not undertake to advise you
of matters which occur subsequent to the date hereof and which affect the
opinion expressed herein.
 
This opinion is rendered only to DNB NOR BANK ASA, NEW YORK BRANCH, as
Administrative Agent, and Collateral Agent, and the Lenders and their respective
successors and
 
 
 
 
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assigns, and is solely for their benefit in connection with the Credit Agreement
and the Security Documents.  This opinion may not be relied upon by the
Collateral Agent, Administrative Agent or any such Lender for any other purpose,
or quoted to or relied upon by any other person, firm or corporation for any
purpose without our prior written consent.
 
 
Very truly yours,
 
Constantine P. Georgiopoulos
 

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        EXHIBIT C-3      
    

SCHEDULE I
 
Lenders
 
DnB NOR BANK ASA, NEW YORK BRANCH
 

 

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SCHEDULE II
 
Mortgaged Vessels
 
Vessel Name
Vessel Owner
Registry Number
Jurisdiction of Registry
Flag
         
Genco Acheron
Genco Acheron Limited
HK-8742
Hong Kong
Hong Kong
Genco Beauty
Genco Beauty Limited
HK-1284
Hong Kong
Hong Kong
Genco Commander
Genco Commander Limited
HK-1781
Hong Kong
Hong Kong
Genco Knight
Genco Knight Limited
HK-1273
Hong Kong
Hong Kong
Genco Leader
Genco Leader Limited
HK-1046
Hong Kong
Hong Kong
Genco Muse
Genco Muse Limited
HK-1615
Hong Kong
Hong Kong
Genco Vigour
Genco Vigour Limited
HK-1283
Hong Kong
Hong Kong
Genco Trader
Genco Trader Limited
HK-1047
Hong Kong
Hong Kong
Genco Carrier
Genco Carrier Limited
HK-0993
Hong Kong
Hong Kong
Genco Prosperity
Genco Prosperity Limited
HK-0914
Hong Kong
Hong Kong
Genco Success
Genco Success Limited
HK-1113
Hong Kong
Hong Kong
Genco Wisdom
Genco Wisdom Limited
HK-0932
Hong Kong
Hong Kong
Genco Marine
Genco Marine Limited
HK-0709
Hong Kong
Hong Kong
Genco Explorer
Genco Explorer Limited
HK-0895
Hong Kong
Hong Kong
Genco Pioneer
Genco Pioneer Limited
HK-0970
Hong Kong
Hong Kong
Genco Progress
Genco Progress Limited
HK-0964
Hong Kong
Hong Kong
Genco Reliance
Genco Reliance Limited
HK-1124
Hong Kong
Hong Kong
Genco Surprise
Genco Surprise Limited
HK-1782
Hong Kong
Hong Kong
Genco Sugar
Genco Sugar Limited
HK-0732
Hong Kong
Hong Kong

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SCHEDULE III
 
Filing Offices
 
Secretary of State of the State of New York
 
Recorder of Deed of the District of Columbia
 

 
 
 

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EXHIBIT C-4
 
PRIVATE AND CONFIDENTIAL
Our Ref:
     
Your Ref:
DnB NOR Bank ASA
Direct Tel: (852) 2843 4366/4256
200 Park Avenue, 31st Floor
Direct Fax: (852) 2103 5990/5959
New York, NY 10166-0396
 
(as Administrative Agent and Collateral Agent
Date: __________, 200_
for and on behalf of the Lenders defined below)
     

Dear Sirs,
 
Secured revolving loan facility to Genco Shipping & Trading Limited
 
1.                            
Introduction

 
We have acted as your Hong Kong legal advisers in connection with a credit
agreement (the “Credit Agreement”) dated July __, 2007, by and among (1) GENCO
SHIPPING & TRADING LIMITED, a corporation organized and existing under the laws
of the Republic of the Marshall Islands (the “Borrower”), (2) the banks and
financial institutions acceptable to the Borrower and Mandated Lead Arranger (as
defined below) listed in Schedule I of this Credit Agreement, as lenders (the
“Lenders”), and (3) DnB NOR BANK ASA, acting through its New York branch (“DnB”)
as Administrative Agent (in such capacity, the “Administrative Agent”), mandated
lead arranger, as bookrunner, as security trustee and as collateral agent under
the Security Documents (in such capacity, the “Collateral Agent”) under which
the Lenders have agreed to make available to the Borrower a secured revolving
loan facility based on a commitment of up to One Billion Three Hundred Seventy
Seven Million United States Dollars (US$1,377,000,000)  Pursuant to the terms
and conditions of the Credit Agreement, each of the Borrower’s subsidiaries
listed in attached Schedule (together, the “Subsidiaries” each a “Subsidiary”)
is required to execute certain guaranties, pledge agreements, vessel mortgages,
assignments of earnings, assignments of insurances, assignments of charters,
assignments of purchase contracts and assignments of construction contracts in
respect of vessels owned or acquired by the relevant Subsidiary as security for
amounts loaned to the Borrower pursuant to the Credit Agreement.
 
Words and expressions having defined meanings in the Agreement shall have the
same meanings when used in this letter.
 
 
 
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2.                            
Documents Examined

 
For the purposes of giving the opinions expressed in this letter we have
examined:-
 
(1)    
a copy of the Credit Agreement;

 
(2)    
a copy of the executed Note, dated as of July__, 2007, issued by the Borrower
and delivered to the Administrative Agent;

 
(3)    
a copy of the executed Pledge and Security Agreement, dated as of July __, 2007,
among the Borrower, the Subsidiary named therein and the Collateral Agent as
pledgee (the “Pledge Agreement”);

 
(4)    
a copy of the executed Guaranty, dated as of July __, 2007, made by the
Company’s Subsidiary named therein in favor of the Collateral Agent;

 
(5)    
[a copy of the executed Hong Kong Vessel Mortgages, dated as of [         ] and
entered into by each Subsidiary which owns a mortgaged vessel, as mortgagor, as
is a party thereto (the “Vessel Mortgages”);]

 
(6)    
[a copy of the executed Assignments of Earnings, dated as of [         ] and
entered into by each Subsidiary which owns a mortgaged vessel (herein, the
“Assignor”) as is a party thereto (the “Assignments of Earnings”);]

 
(7)    
[a copy of the executed Assignments of Insurances, dated as of [         ] and
entered into by each Assignor as is a party thereto (the “Assignments of
Insurances”);]

 
(8)    
[a copy of the executed Assignments of Charters, dated as of [          ] and
entered into by each Assignor as is a party thereto (the “Assignment of
Charters”);]

 
(9)    
[a copy of the executed Assignments of Purchase Contracts, dated as of
[           ] and entered into by each Assignor as is a party thereto (the
“Assignments of Purchase Contracts”);]

 
(10)    
[a copy of the executed Assignments of Construction Contracts and Refund
Guarantees, dated as of [          ] and entered into by each Assignor as is a
party thereto; and]

 
(11)    
a copy of the executed articles of incorporation and by-laws of the Borrower and
each of the Subsidiary, resolutions of the Board of Directors of the Borrower
and each of the Subsidiaries, the powers of attorney issued by the Borrower and
each of the Subsidiary (collectively, the “POAs” and each a “POA”) and a
certificate of good standing for the Borrower and each of the Subsidiary;

 
The documents specified at paragraph 2(1) to (11) (inclusive) are herein
together referred to as the “Documents”.
 
 
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We have undertaken a search against each Subsidiary’s files on [_______] and a
search of the Cause Book kept at the High Court of Hong Kong on [_________].
 
We have examined a Transcript of Registry in respect of the motor vessels “Genco
Acheron”, “Genco Beauty”, “Genco Carrier”, “Genco Commander” “Genco Explorer”,
“Genco Knight”, “Genco Leader”, “Genco Marine”, “Genco Muse”, “Genco Pioneer”,
“Genco Progress”, “Genco Prosperity”, “Genco Reliance”, “Genco Success”, “Genco
Sugar”, “Genco Surprise”, “Genco Trader”, “Genco Vigour” and “Genco Wisdom”,
issued by the Registrar of Ships at the Port of Authority of Hong Kong (bearing
details of the recorded mortgages in respect of the aforementioned vessels,
collectively the “Vessel Searches”).
 
3.                            
Applicable Law

 
Our opinion relates solely to Hong Kong law at the date of this letter and we
have assumed due compliance with the laws of any other countries the laws of
which may be applicable to the execution, delivery, performance or enforcement
of the Documents. We have made no independent investigation into the laws of any
other state or country, including in particular, but without limitation, the
laws of the State of New York, United States of America and the jurisdiction
where the parties to the Documents (other than each Subsidiary) are
incorporated.
 
4.                            
Assumptions

 
For the purposes of this letter, we have assumed:-
 
(a)    
that the Documents have each been duly authorised, executed and delivered by
each of the parties thereto (save as specifically mentioned herein) and that
each such party has obtained any necessary consent or authorisation or is
otherwise qualified or empowered to enter into and perform its obligations under
the Documents to which it is a party and that no provision of law of or relating
to the jurisdiction of the incorporation of any of the other parties (other than
the laws of Hong Kong) or any other law will affect the validity and
enforceability of the Documents against any of the parties thereto;

 
(b)    
that the Documents to which each is a party constitute legal, valid and binding
obligations of the Subsidiaries under all applicable laws (other than the laws
of Hong Kong);

 
(c)    
that there are no provisions of the laws of any jurisdiction, other than Hong
Kong as they apply to the Subsidiaries and in respect of which we are opining in
this letter, which would have any implications on the opinions we express;

 
(d)    
the absence of any other or collateral arrangements between any of the parties
to the Documents which modify or supersede any of the terms of the Documents;

 
(e)    
that each of the Subsidiaries’ Resolutions provided to us for inspection are
respectively a faithful record of resolutions either duly passed by the Board of

 
 
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Directors in writing or at a meeting duly convened and held, or by telephonic
conference, of the Board of Directors of each Subsidiary and have not been
amended or rescinded and are in full force and effect;
 
(f)    
that each of the POAs has been duly issued by the relevant Subsidiary and has
not been amended or rescinded and is in full force and effect;

 
(g)    
the genuineness of all signatures and seals on all documents or on the originals
thereof;

 
(h)    
the completeness and conformity to original documents of all copies submitted to
us and that no alteration has been made to the Subsidiaries from the copies
thereof provided to us for inspection;

 
(i)    
the accuracy of translation of any document submitted to us for inspection in
English translated from the foreign language of the original;

 
(j)    
that the information disclosed by our searches at the Hong Kong Companies
Registry against the Subsidiaries has not since the date of our searches been
materially altered and that such searches did not fail to disclose any material
information which had been delivered for filing or registration but was not
disclosed, or, as the case may be, did not appear on the public files at the
time of our searches;

 
(k)    
that insofar as any obligation under the Documents falls to be performed in any
jurisdiction outside Hong Kong, its performance will not be illegal or
ineffective by virtue of the laws of that jurisdiction;

 
(l)    
that each of the Subsidiaries was fully solvent immediately after entry into the
Documents to which it is respectively a party and that the obligations assumed
by each of the Subsidiaries under the Documents to which it is respectively a
party were in its best interests and that the directors of each Subsidiary
honestly and reasonably considered them to be in the best interests of each
Subsidiary respectively;

 
(m)    
none of the Lenders, the Administrative Agent and the Collateral Agent nor any
of their respective officers or employees has notice of (i) any matter which
would adversely affect the validity of any of the Subsidiaries’ Resolutions or
(ii) any other matter which would affect the bona fides of the execution and
delivery by each Subsidiary of the Documents to which each is respectively a
party;

 
(n)    
there are no grounds to believe that the opinion of the directors of each
Subsidiary as to the commercial benefit to that Subsidiary to be derived from
each Subsidiary entering into the Documents to which each is respectively a
party and guaranteeing and/or securing the Borrower’s obligations under the
Agreement reflected in the Subsidiaries’ Resolutions was not an opinion honestly
and reasonably held by those directors;

 
 
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(o)    
the Borrower has not established a place of business in Hong Kong;

 
(p)    
that the Lenders, the Administrative Agent and the Collateral Agent have
complied with all laws and regulations relating to their businesses which are
relevant to the Documents;

 
(q)    
the accuracy of all representations and statements as to factual matters
contained in the Documents and the Subsidiaries’ Resolutions;

 
(r)    
that the information disclosed by the Vessel Searches has not, since the date
hereof, been altered or added to and that the Vessel Searches disclosed all
information which had been delivered for filing and registration; and

 
(s)    
that the written notices of assignments contained in the Documents have been, or
will be served on the relevant addressees, in accordance with the provisions of
the Documents.

 
5.                            
Opinion

 
On the basis of the foregoing and subject to the qualifications set out in
paragraph 6 below, we are of the opinion that:-
 
(a)    
each of the Subsidiaries is registered as an oversea company with an established
place of business in Hong Kong under Part XI of the Companies Ordinance (Cap.
32) of the Laws of Hong Kong; our searches at the Hong Kong Companies Registry
and at the High Court of Hong Kong did not reveal any winding-up order against
the Subsidiaries, any resolution of the shareholders voluntarily to wind-up the
Subsidiaries, any order for the appointment of any receiver of the Subsidiaries
or any statutory declaration by the directors of the Subsidiaries pursuant to
Section 228A of the Companies Ordinance (Cap.32) of the Laws of Hong Kong;

 
(b)    
the Documents including any charges granted therein, to the extent that Hong
Kong law applies to them, to which they are respectively parties and as executed
and delivered, constitute valid and legally binding obligations of each
Subsidiary, enforceable against each Subsidiary in accordance with their terms;

 
(c)    
the motor vessel “Genco Acheron” is duly registered in the name of Genco Acheron
Limited under and pursuant to the laws and flag of Hong Kong with Official
Number HK-8742 free and clear all registered mortgages save for the Vessel
Mortgage in respect of the “Genco Acheron”;

 
(d)    
the Vessel Mortgage in respect of the “Genco Acheron” has been duly executed by
Genco Acheron Limited and registered at the Hong Kong Shipping Registry. This
Vessel Mortgage constitutes a valid first priority mortgage lien on the motor
vessel “Genco Acheron”;

 
(e)    
the motor vessel “Genco Beauty” is duly registered in the name of Genco Beauty
Limited under and pursuant to the laws and flag of Hong Kong with Official

 
 
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            Number HK-1284 free and clear all registered mortgages save for
Vessel Mortgage in respect of the “Genco Beauty”;
 
(f)    
the Vessel Mortgage in respect of the “Genco Beauty” has been duly executed by
Genco Beauty Limited and registered at the Hong Kong Shipping Registry. This
Vessel Mortgage constitutes a valid first priority mortgage lien on the motor
vessel “Genco Beauty”;

 
(g)    
the motor vessel “Genco Carrier” is duly registered in the name of Genco Carrier
Limited under and pursuant to the laws and flag of Hong Kong with Official
Number HK-0993 free and clear all registered mortgages save for the Vessel
Mortgage in respect of the “Genco Carrier”;

 
(h)    
the Vessel Mortgage in respect of the “Genco Carrier” has been duly executed by
Genco Carrier Limited and registered at the Hong Kong Shipping Registry. This
Vessel Mortgage constitutes a valid first priority mortgage lien on the motor
vessel “Genco Carrier”;

 
(i)    
the motor vessel “Genco Commander” is duly registered in the name of Genco
Commander Limited under and pursuant to the laws and flag of Hong Kong with
Official Number HK-1781 free and clear all registered mortgages save for the
Vessel Mortgage in respect of the “Genco Commander”;

 
(j)    
the Vessel Mortgage in respect of the “Genco Commander” has been duly executed
by Genco Commander Limited and registered at the Hong Kong Shipping Registry.
This Vessel Mortgage constitutes a valid first priority mortgage lien on the
motor vessel “Genco Commander”;

 
(k)    
the motor vessel “Genco Explorer” is duly registered in the name of Genco
Explorer Limited under and pursuant to the laws and flag of Hong Kong with
Official Number HK-0895 free and clear all registered mortgages save for the
Vessel Mortgage in respect of the “Genco Explorer”;

 
(l)    
the Vessel Mortgage in respect of the “Genco Explorer” has been duly executed by
Genco Explorer Limited and registered at the Hong Kong Shipping Registry. This
Vessel Mortgage constitutes a valid first priority mortgage lien on the motor
vessel “Genco Explorer”;

 
(m)    
the motor vessel “Genco Knight” is duly registered in the name of Genco Knight
Limited under and pursuant to the laws and flag of Hong Kong with Official
Number HK-1273 free and clear all registered mortgages save for the Vessel
Mortgage in respect of the “Genco Knight”;

 
(n)    
the Vessel Mortgage in respect of the “Genco Knight” has been duly executed by
Genco Knight Limited and registered at the Hong Kong Shipping Registry. This
Vessel Mortgage constitutes a valid first priority mortgage lien on the motor
vessel “Genco Knight”;

 
 
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(o)    
the motor vessel “Genco Leader” is duly registered in the name of Genco Leader
Limited under and pursuant to the laws and flag of Hong Kong with Official
Number HK-1046 free and clear all registered mortgages save for the Vessel
Mortgage in respect of the “Genco Leader”;

 
(p)    
the Vessel Mortgage in respect of the “Genco Leader” has been duly executed by
Genco Leader Limited and registered at the Hong Kong Shipping Registry. This
Vessel Mortgage constitutes a valid first priority mortgage lien on the motor
vessel “Genco Leader”;

 
(q)    
the motor vessel “Genco Marine” is duly registered in the name of Genco Marine
Limited under and pursuant to the laws and flag of Hong Kong with Official
Number HK-0709 free and clear all registered mortgages save for the Vessel
Mortgage in respect of the “Genco Marine”;

 
(r)    
the Vessel Mortgage in respect of the “Genco Marine” has been duly executed by
Genco Marine Limited and registered at the Hong Kong Shipping Registry. This
Vessel Mortgage constitutes a valid first priority mortgage lien on the motor
vessel “Genco Marine”;

 
(s)    
the motor vessel “Genco Muse” is duly registered in the name of Genco Muse
Limited under and pursuant to the laws and flag of Hong Kong with Official
Number HK-1615 free and clear all registered mortgages save for the Vessel
Mortgage in respect of the “Genco Muse”;

 
(t)    
the Vessel Mortgage in respect of the “Genco Muse” has been duly executed by
Genco Muse Limited and registered at the Hong Kong Shipping Registry. This
Vessel Mortgage constitutes a valid first priority mortgage lien on the motor
vessel “Genco Muse”;

 
(u)    
the motor vessel “Genco Pioneer” is duly registered in the name of Genco Pioneer
Limited under and pursuant to the laws and flag of Hong Kong with Official
Number HK-0970 free and clear all registered mortgages save for the Vessel
Mortgage in respect of the “Genco Pioneer”;

 
(v)    
the Vessel Mortgage in respect of the “Genco Pioneer” has been duly executed by
Genco Pioneer Limited and registered at the Hong Kong Shipping Registry. This
Vessel Mortgage constitutes a valid first priority mortgage lien on the motor
vessel “Genco Pioneer”;

 
(w)    
the motor vessel “Genco Progress” is duly registered in the name of Genco
Progress Limited under and pursuant to the laws and flag of Hong Kong with
Official Number HK-0964 free and clear all registered mortgages save for the
Vessel Mortgage in respect of the “Genco Progress”;

 
(x)    
the Vessel Mortgage in respect of the “Genco Progress” has been duly executed by
Genco Progress Limited and registered at the Hong Kong Shipping Registry.

 
 
7

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This Vessel Mortgage constitutes a valid first priority mortgage lien on the
motor vessel “Genco Progress”;
 
(y)    
the motor vessel “Genco Prosperity” is duly registered in the name of Genco
Prosperity Limited under and pursuant to the laws and flag of Hong Kong with
Official Number HK-0914 free and clear all registered mortgages save for the
Vessel Mortgage in respect of the “Genco Prosperity”;

 
(z)    
the Vessel Mortgage in respect of the “Genco Prosperity” has been duly executed
by Genco Prosperity Limited and registered at the Hong Kong Shipping Registry.
This Vessel Mortgage constitutes a valid first priority mortgage lien on the
motor vessel “Genco Prosperity”;

 
(aa)    
the motor vessel “Genco Reliance” is duly registered in the name of Genco
Reliance Limited under and pursuant to the laws and flag of Hong Kong with
Official Number HK-1124 free and clear all registered mortgages save for the
Vessel Mortgage in respect of the “Genco Reliance”;

 
(bb)    
the Vessel Mortgage in respect of the “Genco Reliance” has been duly executed by
Genco Reliance Limited and registered at the Hong Kong Shipping Registry. This
Vessel Mortgage constitutes a valid first priority mortgage lien on the motor
vessel “Genco Reliance”;

 
(cc)    
the motor vessel “Genco Success” is duly registered in the name of Genco Success
Limited under and pursuant to the laws and flag of Hong Kong with Official
Number HK 1113 free and clear all registered mortgages save for the Vessel
Mortgage in respect of the “Genco Success”;

 
(dd)    
the Vessel Mortgage in respect of the “Genco Success” has been duly executed by
Genco Success Limited and registered at the Hong Kong Shipping Registry. This
Vessel Mortgage constitutes a valid first priority mortgage lien on the motor
vessel “Genco Success”;

 
(ee)    
the motor vessel “Genco Sugar” is duly registered in the name of Genco Sugar
Limited under and pursuant to the laws and flag of Hong Kong with Official
Number HK-0732 free and clear all registered mortgages save for the Vessel
Mortgage in respect of the “Genco Sugar”;

 
(ff)    
the Vessel Mortgage in respect of the “Genco Sugar” has been duly executed by
Genco Sugar Limited and registered at the Hong Kong Shipping Registry. This
Vessel Mortgage constitutes a valid first priority mortgage lien on the motor
vessel “Genco Sugar”;

 
(gg)    
the motor vessel “Genco Surprise” is duly registered in the name of Genco
Surprise Limited under and pursuant to the laws and flag of Hong Kong with
Official Number HK-1782 free and clear all registered mortgages save for the
Vessel Mortgage in respect of the “Genco Surprise”;

 
 
8

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(hh)    
the Vessel Mortgage in respect of the “Genco Surprise” has been duly executed by
Genco Surprise Limited and registered at the Hong Kong Shipping Registry. This
Vessel Mortgage constitutes a valid first priority mortgage lien on the motor
vessel “Genco Surprise”;

 
(ii)    
the motor vessel “Genco Trader” is duly registered in the name of Genco Trader
Limited under and pursuant to the laws and flag of Hong Kong with Official
Number HK-1047 free and clear all registered mortgages save for the Vessel
Mortgage in respect of the “Genco Trader”;

 
(jj)    
the Vessel Mortgage in respect of the “Genco Trader” has been duly executed by
Genco Trader Limited and registered at the Hong Kong Shipping Registry. This
Vessel Mortgage constitutes a valid first priority mortgage lien on the motor
vessel “Genco Trader”;

 
(kk)    
the motor vessel “Genco Vigour” is duly registered in the name of Genco Vigour
Limited under and pursuant to the laws and flag of Hong Kong with Official
Number HK-1283 free and clear all registered mortgages save for the Vessel
Mortgage in respect of the “Genco Vigour”;

 
(ll)    
the Vessel Mortgage in respect of the “Genco Vigour” has been duly executed by
Genco Vigour and registered at the Hong Kong Shipping Registry. This Vessel
Mortgage constitutes a valid first priority mortgage lien on the motor vessel
“Genco Vigour”;

 
(mm)    
the motor vessel “Genco Wisdom” is duly registered in the name of Genco Wisdom
Limited under and pursuant to the laws and flag of Hong Kong with Official
Number HK-0932 free and clear all registered mortgages save for the Vessel
Mortgage in respect of the “Genco Wisdom”;

 
(nn)    
the Vessel Mortgage in respect of the “Genco Wisdom” has been duly executed by
Genco Wisdom Limited and registered at the Hong Kong Shipping Registry. This
Vessel Mortgage constitutes a valid first priority mortgage lien on the motor
vessel “Genco Wisdom”;

 
(oo)    
no consent, authorisation, licence or approval (including exchange control
approvals) of or registration with or declaration to any Hong Kong governmental
or public body or authority or court is required to authorize, or is required by
the Subsidiaries in connection with, the execution, delivery, legality,
validity, priority, admissibility in evidence or effectiveness of the Documents
to which they are respectively a party;

 
(pp)    
no stamp duty or registration or similar taxes or charges are payable in Hong
Kong in respect of the Documents.

 
(qq)    
there is, at the date of this opinion letter, no Hong Kong withholding or other
tax to be deducted from any payment whether of principal or interest or
otherwise to be made by the Subsidiaries pursuant to any of the provisions of
the Documents;

 
 
9

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(rr)    
the execution and delivery of, the performance of its obligations under, and
compliance by the Subsidiaries with the provisions of the Documents to which
they are respectively a party, do not contravene any existing Hong Kong law,
statute, rule or regulation to which each Subsidiary is subject;

 
(ss)    
save only for the registration of the Vessel Mortgages at the Hong Kong Shipping
Registry and the registration of particulars of charges created by the Documents
(to the extent that such Documents contain a charge and are executed by a
company incorporated under the laws of Hong Kong or registered as an overseas
company in Hong Kong) at the Hong Kong Companies Registry within five weeks of
their creation, no further action need be taken to ensure the legality,
validity, enforceability or admissibility in evidence in Hong Kong of the
Documents or the priority of the security interests created thereunder;

 
(tt)    
under Hong Kong law, the choice of New York law to govern the Documents (other
than the Vessel Mortgages is a valid choice of law, assuming that such choice is
made bona fide by each Subsidiary and so long as the choice is not made by each
Subsidiary with the intention of avoiding the mandatory application of the laws
of another jurisdiction and is valid and binding upon each Subsidiary under New
York law;

 
(uu)    
the Lenders, the Administrative Agent or the Collateral Agent will not be deemed
to be resident, domiciled, carrying on business or subject to taxation in Hong
Kong by reason only of the negotiation, preparation, execution, performance or
enforcement of, and/or receipt of any payment from the Subsidiaries under, the
Documents.

 
6.                            
Qualifications

 
This letter is subject to the following qualifications:-
 
(a)    
enforcement of the obligations of the parties to the Documents in a Hong Kong
court may be limited by prescription or lapse of time or by bankruptcy,
insolvency, liquidation, winding-up, reorganisation, reconstruction or similar
laws affecting creditor’s rights generally. In particular, and notwithstanding
any provisions in the Documents regarding waivers, under Hong Kong law failure
to exercise a right of action for more than six years (or twelve years in the
case of a document executed under seal or intended to take effect as a deed)
will operate as a bar to the exercise of such right, and failure to exercise
such right for a lesser period may result in such right being waived;

 
(b)    
the availability of certain equitable remedies, such as injunction and specific
performance, will be at the discretion of the court and a court might make an
award of damages where specific performance of an obligation, or some other
equitable remedy, is sought;

 
(c)    
any provision of any of the Documents providing that certain calculations and/or
certificates will be conclusive and binding will riot be effective if such

 
 
10

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calculations or certificates are erroneous on their face or fraudulent and will
not necessarily prevent judicial enquiry into the merits of any claim by an
aggrieved party;
 
(d)    
where a party under any of the Documents is vested with a discretion, or may
determine a matter in its opinion, Hong Kong law may require that such
discretion is exercised reasonably or that such opinion is based upon reasonable
grounds;

 
(e)    
any currency indemnity provision of the Documents may not be enforceable in the
Hong Kong courts in relation to any judgment delivered by any court and
expressed in a currency other than that in which the relevant sum is payable;

 
(f)    
where any of the Documents is to be performed in jurisdictions outside Hong
Kong, it may not be enforced in such jurisdiction to the extent that such
performance would be illegal or contrary to public policy under the laws of any
such jurisdiction;

 
(g)    
the severability of provisions of any of the Documents which are illegal,
invalid or unenforceable is, as a matter of Hong Kong law, at the discretion of
the court;

 
(h)    
proceedings in a Hong Kong court may be stayed if concurrent proceedings are
being brought elsewhere or where it is shown that there is some other forum,
having competent jurisdiction, which is more appropriate for the trial of the
action on the basis that the case can be tried more suitably for the interests
of all parties and the ends of justice, save where the court’s discretion to
stay an action may be excluded by statute or convention;

 
(i)    
a Hong Kong court may refuse to give effect to any undertaking for reimbursement
or indemnity against expenses in respect of the costs of unsuccessful litigation
brought before such a court;

 
(j)    
the searches against the filed particulars of the Subsidiaries who have
registered as an oversea company with an established place of business in Hong
Kong under Part XI of the Companies Ordinance (Cap.32) of the Laws of Hong Kong
referred to in paragraph 2 above are not conclusively capable of revealing
whether or not:

 
(i)    
a winding up order has been made or a resolution passed for the winding up of
such Subsidiary ;

 
(ii)    
any order for the appointment of any receiver of such Subsidiary has been made;
or

 
(iii)    
a receiver or liquidator has been appointed; or

 
(iv)    
any statutory declaration by the directors of such Subsidiary pursuant to
Section 228A of the Companies Ordinance, (Cap.32) of the Laws of Hong Kong has
been made

 
 
11

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since notice of these matters may not be filed with the Registrar of Companies
immediately and, when filed, may not be entered on the public files of such
Subsidiary immediately. In addition, such searches are not capable of revealing,
prior to the making of the relevant order, whether or not a winding up petition
or an application to the court for the appointment of a receiver has been
presented, or any matters which have been lodged for registration but have not
actually been registered at the date the copy of the relevant file was made
available to us;
 
(k)    
under the rules of procedure applicable, a Hong Kong court may, at its
discretion, order a plaintiff in an action, being a party who is not ordinarily
resident in some part of Hong Kong, to provide security for costs;

 
(l)    
the search of the High Court cause book referred to in paragraph 2 is not
capable of revealing conclusively whether any litigation or proceeding is in
progress (either in Hong Kong or in any other jurisdiction) involving or
otherwise concerning the Subsidiaries;

 
(m)    
we express no view on any provision in any of the Documents requiring written
amendments and waivers of any of the provisions of such Document in so far as it
suggests that oral or other modifications, amendments or waivers could not be
effectively agreed upon or granted by or between the parties or implied by the
course of conduct of the parties;

 
(n)    
save as provided in paragraph 5(e) to (hh), we express no opinion as to the
title of any of the Subsidiaries to any of the security assets being the subject
of the Security Documents or the ranking of any security created or to be
created by such documents, as to the nature of the security created thereby or
as to the marketability of or rights of enforcement over such security assets;

 
(o)    
the effectiveness of terms relieving a party from a liability or duty otherwise
owed are limited by law;

 
(p)    
Section 24 of the Money Lenders Ordinance (Cap.163) of the Laws of Hong Kong
makes it illegal to lend or offer to lend money at any effective rate of
interest which exceeds sixty per centum (60%) per annum and makes any agreement
for the repayment of any loan or the payment of interest on any loan and any
security therefor unenforceable in any case in which the effective rate of
interest exceeds such rate; and

 
(q)    
Section 25 of the Money Lenders Ordinance (Cap.163) of the Laws of Hong Kong
provides that a Hong Kong court may “reopen the transaction so as to do justice
between the parties” if the transaction is “extortionate”. For this purpose a
loan in respect of which the effective rate of interest exceeds forty eight per
centum (48%) per annum is presumed to be “extortionate”.

 
7.                            
The Basic Law

 
 
12

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Without prejudice to the generality of the foregoing, it should be noted that on
1st July 1997 Hong Kong became the Hong Kong Special Administrative Region (the
“HKSAR”) of the People’s Republic of China (the “PRC”) and the Basic Law of the
HKSAR (the “Basic Law”) adopted on 4th April 1990 by the National People’s
Congress (the “NPC”) of the PRC is now applicable to Hong Kong. Article 8 of the
Basic Law provides that the laws previously in force in Hong Kong, that is, the
common law, rules of equity, ordinances, subordinate legislation and customary
law shall be maintained, except for any that contravene the Basic Law, and
subject to any amendment by the legislature of the HKSAR. Under Article 160 of
the Basic Law, the Laws of Hong Kong in force at 30th June 1997 were adopted as
laws of the HKSAR except for those which the Standing Committee of the NPC (the
“Standing Committee”) declared to be in contravention of the Basic Law. On 23rd
February 1997 the Standing Committee on its 24th sitting decided that the laws
previously in force in Hong Kong, including the common law, rules of equity,
ordinances, subsidiary legislation and customary law shall, unless they
contravene the Basic Law, be adopted as the laws of the HKSAR. However, the
Standing Committee also decided that certain laws and provisions (namely those
listed in Schedules 1 and 2 of the decision) will not be so adopted as they
contravene the Basic Law. These unadopted laws however appear to us to have no
bearing on those Laws of Hong Kong which are relevant to what is stated in this
opinion.
 
To give effect to (inter alia) the said decision of the Standing Committee, the
Hong Kong Reunification Ordinance was adopted by the HKSAR’s legislature on 1st
July 1997 (Ordinance No.110 of 1997). Section 7 of this Ordinance reiterates in
essence what is stated in the decision of the Standing Committee, namely “the
laws previously in force in Hong Kong, that is the common law, rules of equity,
ordinances, subsidiary legislation and customary law, which have been adopted as
the laws of the HKSAR, shall continue to apply”. The Hong Kong Reunification
Ordinance also introduced an amendment to the Interpretation and General Clauses
Ordinance (Cap. 1) of the Laws of Hong Kong by inserting a new Article 2A which
provides (inter alia) that “all laws previously in force shall be construed with
such modifications, adaptations, limitations and exceptions as may be necessary
so as not to contravene the Basic Law and to bring them into conformity with the
status of Hong Kong as a Special Administrative Region of the People’s Republic
of China”. The expression “laws previously in force” was defined thereunder to
mean “the common law, rules of equity, ordinances, subsidiary legislation and
customary law in force immediately before 1st July 1997 and adopted as laws of
the Hong Kong Special Administrative Region”. The Laws of Hong Kong which are
relevant to what is stated in this opinion do not appear to us to contravene the
Basic Law nor do they appear to require any modifications, adaptations,
limitations and exceptions in any material manner in order to bring them in
conformity with the status of Hong Kong as a Special Administrative Region of
PRC. Furthermore, we are not aware of any other amendment made by the
legislature of the HKSAR to those Laws of Hong Kong which are relevant to what
is stated in this opinion, which would require us to opine otherwise.
 
 
13

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8.                            
Benefit

 
This opinion is addressed to you personally for your sole benefit and is not to
be relied upon by any other person other than the Lenders (and their assigns and
participants) and:
 
(a)    
it is not to be disclosed in whole or in part by you or the Lenders to anyone
other than persons who in the ordinary course of your or their business have
access to your or their papers and records and on the basis that such persons
will similarly make no further disclosure; and

 
(b)    
it is not to be filed with any governmental agency or authority or quoted in any
public document without, in any such case, our prior written consent.

 
9.                            
Scope

 
This letter is strictly limited to the matters stated herein and is not to be
read as extending by implication to any other matter in connection with the
Subsidiaries, the Documents or otherwise.
 
Yours faithfully,

/s/ Johnson Stokes & Master
Johnson Stokes & Master

14

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Schedule

 
List of Subsidiaries/Vessels
 
Vessel Name
Vessel Owner
Registry Number
Jurisdiction of Registry
Flag
         
Genco Acheron
Genco Acheron Limited
HK-8742
Hong Kong
Hong Kong
Genco Beauty
Genco Beauty Limited
HK-1284
Hong Kong
Hong Kong
Genco Commander
Genco Commander Limited
HK-1781
Hong Kong
Hong Kong
Genco Knight
Genco Knight Limited
HK-1273
Hong Kong
Hong Kong
Genco Leader
Genco Leader Limited
HK-1046
Hong Kong
Hong Kong
Genco Muse
Genco Muse Limited
HK-1615
Hong Kong
Hong Kong
Genco Vigour
Genco Vigour Limited
HK-1283
Hong Kong
Hong Kong
Genco Trader
Genco Trader Limited
HK-1047
Hong Kong
Hong Kong
Genco Carrier
Genco Carrier Limited
HK-0993
Hong Kong
Hong Kong
Genco Prosperity
Genco Prosperity Limited
HK-0914
Hong Kong
Hong Kong
Genco Success
Genco Success Limited
HK-1113
Hong Kong
Hong Kong
Genco Wisdom
Genco Wisdom Limited
HK-0932
Hong Kong
Hong Kong
Genco Marine
Genco Marine Limited
HK-0709
Hong Kong
Hong Kong
Genco Explorer
Genco Explorer Limited
HK-0895
Hong Kong
Hong Kong
Genco Pioneer
Genco Pioneer Limited
HK-0970
Hong Kong
Hong Kong
Genco Progress
Genco Progress Limited
HK-0964
Hong Kong
Hong Kong
Genco Reliance
Genco Reliance Limited
HK-1124
Hong Kong
Hong Kong
Genco Surprise
Genco Surprise Limited
HK-1782
Hong Kong
Hong Kong

 
 
15

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Genco Sugar
Genco Sugar Limited
HK-0732
Hong Kong
Hong Kong

 
 

16

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        Exhibit D      
    

 
FORM OF OFFICER’S CERTIFICATE
 
I, the undersigned, [Chairman of the Board/Chief Executive
Officer/President/Vice President/Treasurer/Manager] of [Name of Credit Party], a
[corporation] [limited liability company] organized and existing under the laws
of the [State of ________] (the “Company”), do hereby certify on behalf of the
Company that:
 
1.           This Certificate is furnished pursuant to Section 5.05(a) of the
Credit Agreement, dated as of July __, 2007, among Genco Shipping & Trading
Limited, the lenders from time to time party thereto DnB Nor Bank ASA, New York
Branch, as Administrative Agent (such Credit Agreement, as in effect on the date
of this Certificate, being herein called the “Credit Agreement”).  Unless
otherwise defined herein, capitalized terms used in this Certificate shall have
the meanings set forth in the Credit Agreement.
 
2.           The following named individuals are elected officers of the
Company, each holds the office of the Company set forth opposite his or her name
and has held such office since _________ __, ____.1  The signature written
opposite the name and title of each such officer is his or her genuine
signature.
 
        Name2                     Office                    Signature
 
______________                                                ___________                                          _____________
 
______________                                                ___________                                          _____________
 
______________                                                ___________                                          _____________
 
3.           Attached hereto as Exhibit A is a certified copy of the
[Certificate of Incorporation] [Articles of Incorporation] [Certificate of
Formation] [Certificate of Limited Partnership] [insert other equivalent
organizational document] of the Company, as filed in the Office of [the
Secretary of State of the State of] [insert other applicable filing office(s)]
_________ on ___________, ____, together with all amendments thereto adopted
through the date hereof.
 
4.           Attached hereto as Exhibit B is a true and correct copy of the
[By-Laws] [Limited Liability Company Agreement] [Limited Partnership Agreement]
[insert other equivalent organizational document] of the Company which were duly
adopted, are in full force and effect on the date hereof, and have been in
effect since _____________, ____.
 
 
1
Insert a date prior to the time of any corporate action relating to the Credit
Documents or related documentation.

 
 
2
Include name, office and signature of each officer who will sign any Credit
Document, including the officer who will sign the certification at the end of
this Certificate or related documentation.

 
 

--------------------------------------------------------------------------------

 
Exhibit D
Page 2
 
5.           Attached hereto as Exhibit C is a true and correct copy of
resolutions which were duly adopted on __________, 20__ [by unanimous written
consent of the [Board of Directors] [Board of Managers] [Managing Member(s)] of
the Company] [by a meeting of the [Board of Directors] [Managing Member(s)] of
the Company at which a quorum was present and acting throughout], and said
resolutions have not been rescinded, amended or modified.  Except as attached
hereto as Exhibit C, no resolutions have been adopted by the [Board of
Directors] [Managing Member(s)] of the Company which deal with the execution,
delivery or performance of any of the Credit Documents to which the Company is
party.
 
[6.           On the date hereof, all of the applicable conditions set forth in
Sections [5, 6, 7 and 8] of the Credit Agreement have been satisfied.
 
7.           Attached hereto as Exhibit D is a true and correct copy of all
Management Agreements.
 
8.           Attached hereto as Exhibit E is a true and correct copy of all
Service Agreements.]3
 
[6][9].  On the date hereof, the representations and warranties contained in the
Credit Agreement and in the other Credit Documents are true and correct in all
material respects with the same effect as though such representations and
warranties had been made on the date hereof, both before and after giving effect
to the incurrence of Loans on the date hereof and the application of the
proceeds thereof, unless stated to relate to a specific earlier date, in which
case such representations and warranties were true and correct in all material
respects as of such earlier date.
 
[7][10].  On the date hereof, no Default or Event of Default has occurred and is
continuing or would result from the Borrowing to occur on the date hereof or
from the application of the proceeds thereof.
 
[8][11].  There is no proceeding for the dissolution or liquidation of the
Company or threatening its existence.
 
 
 
 
 
 
3
Insert only in Officer’s Certificate of the Borrower.

 
 

--------------------------------------------------------------------------------

 
Exhibit D
Page 3
 

 
IN WITNESS WHEREOF, I have hereunto on behalf of the Company set my hand this
____ day of ________________, 20__.
 
[NAME OF CREDIT PARTY]
 
By ______________________________
     Name:
     Title:
 
 
 

--------------------------------------------------------------------------------

 
Exhibit D
Page 4

I, the undersigned, [Secretary/Assistant Secretary] [Manager] of the Company, do
hereby certify on behalf of the Company that:
 
1.           [Name of Person making above certifications] is the duly elected
and qualified [Chairman of the Board/Chief Executive Officer/President/Vice
President/Treasurer/Manager] of the Company and the signature above is his or
her genuine signature.
 
2.           The certifications made by [name of Person making above
certifications] on behalf of the Company in Items 2, 3, 4, 5 and [8][11] above
are true and correct.
 
IN WITNESS WHEREOF, I have hereunto on behalf of the Company set my hand this
____ day of _________, 20__.
 
[NAME OF CREDIT PARTY]
 
By ______________________________
     Name:
     Title:
 
 
 

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Exhibit E
 
GUARANTY
 
GUARANTY, dated as of July 20, 2007 (as amended, modified, restated and/or
supplemented from time to time, this “Guaranty”), made by each of the
undersigned guarantors (each a “Guarantor” and, together with any other entity
that becomes a guarantor hereunder pursuant to Section 25 hereof, the
“Guarantors”).  Except as otherwise defined herein, capitalized terms used
herein and defined in the Credit Agreement (as defined below) shall be used
herein as therein defined.
 
WITNESSETH :
 
WHEREAS, Genco Shipping & Trading Limited (the “Borrower”), the lenders from
time to time party thereto (the “Lenders”), DnB Nor Bank ASA, New York Branch,
as Administrative Agent and as Collateral Agent (in such capacity, together with
any successor Administrative Agent, the “Administrative Agent”), have entered
into a Credit Agreement, dated as of July 20, 2007 (as amended, modified,
restated and/or supplemented from time to time, the “Credit Agreement”),
providing for the making of Loans to the Borrower as contemplated therein (the
Lenders, the Collateral Agent and the Administrative Agent are herein called the
“Lender Creditors”);
 
WHEREAS, the Borrower may at any time and from time to time enter into, or
guaranty the obligations of one or more other Guarantors or any of their
respective Subsidiaries under, one or more Interest Rate Protection Agreements
or Other Hedging Agreements with respect to the Borrower’s obligations under the
Credit Agreement with respect to the outstanding Loans and/or Commitment from
time to time with one or more Lenders or any affiliate thereof (each such Lender
or affiliate, even if the respective Lender subsequently ceases to be a Lender
under the Credit Agree­ment for any reason, together with such Lender’s or
affiliate’s successors and assigns, if any, collectively, the “Other Creditors”
and, together with the Lender Creditors, the “Secured Creditors”);
 
WHEREAS, each Guarantor is a direct or indirect Subsidiary of the Borrower;
 
WHEREAS, it is a condition to the making of Loan [in respect of the Capesize
Vessels]/[Refinancing Loan] and other Loans to the Borrower under the Credit
Agreement that each Guarantor shall have executed and delivered this Guaranty;
and
 
WHEREAS, each Guarantor will obtain benefits from the incurrence of Loans to the
Borrower under the Credit Agreement and the entering into by the Borrower of
Interest Rate Protection Agreements or Other Hedging Agreements and,
accordingly, desires to execute this Guaranty in order to satisfy the conditions
described in the preceding paragraph;
 
 
 

--------------------------------------------------------------------------------

 
Exhibit E
page 2
 
 
NOW, THEREFORE, in consideration of the foregoing and other benefits accruing to
each Guarantor, the receipt and sufficiency of which are hereby acknowledged,
each Guarantor hereby makes the following representations and warranties to the
Secured Creditors and hereby covenants and agrees with each Secured Creditor as
follows:
 
1.  Each Guarantor, jointly and severally, irrevocably, absolutely and
unconditionally guarantees:  (i) to the Lender Creditors the full and prompt
payment when due (whether at the stated maturity, by acceleration or otherwise)
of (x) the principal of, premium, if any, and interest on the Notes issued by,
and the Loans made to, the Borrower under the Credit Agreement, and (y) all
other obligations (including obligations which, but for the automatic stay under
Section 362(a) of the Bankruptcy Code, would become due), liabilities and
indebtedness owing by the Borrower to the Lender Creditors (in the capacities
referred to in the definition of Lender Creditors) under the Credit Agreement
and each other Credit Document to which the Borrower is a party (including,
without limitation, indemnities, fees and interest thereon (including any
interest accruing after the commencement of any bankruptcy, insolvency,
receivership or similar proceeding at the rate provided for in the Credit
Agreement, whether or not such interest is an allowed claim in any such
proceeding)), whether now existing or hereafter incurred under, arising out of
or in connection with the Credit Agreement and any such other Credit Document
and the due performance and compliance by the Borrower with all of the terms,
conditions and agreements contained in all such Credit Documents (all such
principal, premium, interest, liabilities, indebtedness and obligations being
herein collectively called the “Credit Document Obligations”); and (ii) to each
Other Creditor the full and prompt payment when due (whether at the stated
maturity, by acceleration or otherwise) of all obligations (including
obligations which, but for the automatic stay under Section 362(a) of the
Bankruptcy Code, would become due), liabilities and indebtedness (including any
interest accruing after the commencement of any bankruptcy, insolvency,
receivership or similar proceeding at the rate provided for in the respective
Interest Rate Protection Agreements or Other Hedging Agreements, whether or not
such interest is an allowed claim in any such proceeding) owing by the Borrower
under any Interest Rate Protection Agreement or Other Hedging Agreement entered
into in respect of the Borrower’s obligations with respect to the outstanding
Loans and/or Commitments from time to time, whether now in existence or
hereafter arising, and the due performance and compliance by the Borrower with
all of the terms, conditions and agreements contained in each such Interest Rate
Protection Agreement and Other Hedging Agreement to which it is a party (all
such obligations, liabilities and indebtedness being herein collectively called
the “Other Obligations” and, together with the Credit Document Obligations, the
“Guaranteed Obligations”).  As used herein, the term “Guaranteed Party” shall
mean the Borrower party to or as guarantor of any Guarantor or its Subsidiaries
party to any Interest Rate Protection Agreement or Other Hedging Agreement with
an Other Creditor.  Each Guarantor understands, agrees and confirms that the
Secured Creditors may enforce this Guaranty up to the full amount of the
Guaranteed Obligations against such Guarantor without proceeding against any
other Guarantor, the Borrower, any other Guaranteed Party, against any security
for the Guaranteed Obligations, or under any other guaranty covering all or a
portion of the Guaranteed Obligations.
 
 
 

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Exhibit E
page 3
 
2.  Additionally, each Guarantor, jointly and severally, unconditionally,
absolutely and irrevocably, guarantees the payment of any and all Guaranteed
Obligations whether or not due or payable by the Borrower or any other
Guaranteed Party upon the occurrence in respect of the Borrower or any such
other Guaranteed Party of any of the events specified in Section 10.05 of the
Credit Agreement, and unconditionally and irrevocably, jointly and severally,
promises to pay such Guaranteed Obligations to the Secured Creditors, or order,
on demand.  This Guaranty shall constitute a guaranty of payment, and not of
collection.
 
3.  The liability of each Guarantor hereunder is primary, absolute, joint and
several, and unconditional and is exclusive and independent of any security for
or other guaranty of the indebtedness of the Borrower or any other Guaranteed
Party whether executed by such Guarantor, any other Guarantor, any other
guarantor or by any other party, and the liability of each Guarantor hereunder
shall not be affected or impaired by any circumstance or occurrence whatsoever,
including, without limitation:  (a) any direction as to application of payment
by the Borrower or any other Guaranteed Party or by any other party, (b) any
other continuing or other guaranty, undertaking or maximum liability of a
guarantor or of any other party as to the Guaranteed Obligations, (c) any
payment on or in reduction of any such other guaranty or undertaking, (d) any
dissolution, change in corporate structure, termination or increase, decrease or
change in personnel, by the Borrower or any other Guaranteed Party, (e) to the
extent permitted by applicable law, any payment made to any Secured Creditor on
the indebtedness which any Secured Creditor repays the Borrower or any other
Guaranteed Party pursuant to court order in any bankruptcy, reorganization,
arrangement, moratorium or other debtor relief proceeding, and each Guarantor
waives any right to the deferral or modification of its obligations hereunder by
reason of any such proceeding, (f) any action or inaction by the Secured
Creditors as contemplated in Section 6 hereof or (g) any invalidity,
irregularity or unenforceability of all or any part of the Guaranteed
Obligations or of any security therefor, including, without limitation, any such
invalidity, irregularity or unenforceability caused by a change in law.
 
4.  The obligations of each Guarantor hereunder are independent of the
obligations of any other Guarantor, any other guarantor, the Borrower or any
other Guaranteed Party, and a separate action or actions may be brought and
prosecuted against each Guarantor whether or not action is brought against any
other Guarantor, any other guarantor, the Borrower or any other Guaranteed Party
and whether or not any other Guarantor, any other guarantor, the Borrower or any
other Guaranteed Party be joined in any such action or actions.  Each Guarantor
waives, to the fullest extent permitted by law, the benefits of any statute of
limitations affecting its liability hereunder or the enforcement thereof.  Any
payment by the Borrower or any other Guaranteed Party or other circumstance
which operates to toll any statute of limitations as to the Borrower or any
other Guaranteed Party shall operate to toll the statute of limitations as to
each Guarantor.
 
5.  Any Secured Creditor may at any time and from time to time without the
consent of, or notice to, any Guarantor, without incurring responsibility to
such Guarantor, without impairing or releasing the obligations of such Guarantor
hereunder, upon or without any terms or conditions and in whole or in part:
 
 
 

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Exhibit E
page 4
 
(a)  change the manner, place or terms of payment of, and/or change, increase or
extend the time of payment of, renew or alter, any of the Guaranteed Obligations
(including any increase or decrease in the rate of interest thereon or the
principal amount thereof), any security therefor, or any liability incurred
directly or indirectly in respect thereof, and the guaranty herein made shall
apply to the Guaranteed Obligations as so changed, extended, renewed or altered;
 
(b)  take and hold security for the payment of the Guaranteed Obligations and
sell, exchange, release, surrender, impair, realize upon or otherwise deal with
in any manner and in any order any property by whomsoever at any time pledged or
mortgaged to secure, or howsoever securing, the Guaranteed Obligations or any
liabilities (including any of those hereunder) incurred directly or indirectly
in respect thereof or hereof, and/or any offset there against;
 
(c)  exercise or refrain from exercising any rights against the Borrower, any
other  Guaranteed Party, any other Credit Party, any Subsidiary thereof or
otherwise act or refrain from acting;
 
(d)  release or substitute any one or more endorsers, Guarantors, other
guarantors, the Borrower, any other Guaranteed Party, or other obligors;
 
(e)  settle or compromise any of the Guaranteed Obligations, any security
therefor or any liability (including any of those hereunder) incurred directly
or indirectly in respect thereof or hereof, and may subordinate the payment of
all or any part thereof to the payment of any liability (whether due or not) of
the Borrower or any other Guaranteed Party to creditors of the Borrower or such
other Guaranteed Party other than the Secured Creditors;
 
(f)  apply any sums by whomsoever paid or howsoever realized to any liability or
liabilities of the Borrower or any other Guaranteed Party to the Secured
Creditors regardless of what liabilities of the Borrower or such other
Guaranteed Party remain unpaid;
 
(g)  consent to or waive any breach of, or any act, omission or default under,
any of the Interest Rate Protection Agreements or Other Hedging Agreements, the
Credit Documents or any of the instruments or agreements referred to therein, or
otherwise amend, modify or supplement (in accordance with their terms) any of
the Interest Rate Protection Agreements or Other Hedging Agreements, the Credit
Documents or any of such other instruments or agreements;
 
(h)  act or fail to act in any manner which may deprive such Guarantor of its
right to subrogation against the Borrower or any other Guaranteed Party to
recover full indemnity for any payments made pursuant to this Guaranty; and/or
 
(i)  take any other action which would, under otherwise applicable principles of
common law, give rise to a legal or equitable discharge of such Guarantor from
its liabilities under this Guaranty.
 
6.  This Guaranty is a continuing one and all liabilities to which it applies or
may apply under the terms hereof shall be conclusively presumed to have been
created in reliance
 
 
 
 

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Exhibit E
page 5
 
hereon.  No failure or delay on the part of any Secured Creditor in exercising
any right, power or privilege hereunder shall operate as a waiver thereof, nor
shall any single or partial exercise of any right, power or privilege hereunder
preclude any other or further exercise thereof or the exercise of any other
right, power or privilege hereunder.  The rights and remedies herein expressly
specified are cumulative and not exclusive of any rights or remedies which any
Secured Creditor would otherwise have hereunder.  No notice to or demand on any
Guarantor in any case shall entitle such Guarantor to any other further notice
or demand in similar or other circumstances or constitute a waiver of the rights
of any Secured Creditor to any other or further action in any circumstances
without notice or demand.  It is not necessary for any Secured Creditor to
inquire into the capacity or powers of the Borrower or any other Guaranteed
Party or the officers, directors, partners or agents acting or purporting to act
on its or their behalf, and any indebtedness made or created in reliance upon
the professed exercise of such powers shall be guaranteed hereunder.
 
7.  Any indebtedness of the Borrower or any other Guaranteed Party now or
hereafter held by any Guarantor is hereby subordinated to the indebtedness of
the Borrower or such other Guaranteed Party to the Secured Creditors, and such
indebtedness of the Borrower or such other Guaranteed Party to any Guarantor, if
the Administrative Agent or the Collateral Agent, after the occurrence and
during the continuance of an Event of Default, so requests, shall be collected,
enforced and received by such Guarantor as trustee for the Secured Creditors and
be paid over to the Secured Creditors on account of the indebtedness of the
Borrower or the other Guaranteed Parties to the Secured Creditors, but without
affecting or impairing in any manner the liability of such Guarantor under the
other provisions of this Guaranty.  Without limiting the generality of the
foregoing, each Guarantor hereby agrees with the Secured Creditors that it will
not exercise any right of subrogation which it may at any time otherwise have as
a result of this Guaranty (whether contractual, under Section 509 of the
Bankruptcy Code or otherwise) until all Guaranteed Obligations have been
irrevocably paid in full in cash.
 
8.  (a)  Each Guarantor waives any right (except as shall be required by
applicable law and cannot be waived) to require the Secured Creditors to:  (i)
proceed against the Borrower, any other Guaranteed Party, any other Guarantor,
any other guarantor of the Guaranteed Obligations or any other party; (ii)
proceed against or exhaust any security held from the Borrower, any other
Guaranteed Party, any other Guarantor, any other guarantor of the Guaranteed
Obligations or any other party; or (iii) pursue any other remedy in the Secured
Creditors’ power whatsoever.  Each Guarantor waives any defense based on or
arising out of any defense of the Borrower, any other Guaranteed Party, any
other Guarantor, any other guarantor of the Guaranteed Obligations or any other
party other than payment in full of the Guaranteed Obligations, including,
without limitation, any defense based on or arising out of the disability of the
Borrower, any other Guaranteed Party, any other Guarantor, any other guarantor
of the Guaranteed Obligations or any other party, or the unenforceability of the
Guaranteed Obligations or any part thereof from any cause, or the cessation from
any cause of the liability of the Borrower or any other Guaranteed Party other
than payment in full of the Guaranteed Obligations.  The Secured Creditors may,
at their election, foreclose on any security held by the Administrative Agent,
the Collateral Agent or the other Secured Creditors by one or more judicial or
nonjudicial sales, whether or not every aspect of any such sale is commercially
 
 
 

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Exhibit E
page 6
 
reasonable, or exercise any other right or remedy the Secured Creditors may have
against the Borrower, any other Guaranteed Party or any other party, or any
security, without affecting or impairing in any way the liability of any
Guarantor hereunder except to the extent the Guaranteed Obligations have been
paid in full in cash.  Each Guarantor waives any defense arising out of any such
election by the Secured Creditors, even though such election operates to impair
or extinguish any right of reimbursement or subrogation or other right or remedy
of such Guarantor against the Borrower, any other Guaranteed Party or any other
party or any security.
 
(b)  Each Guarantor waives all presentments, promptness, diligence, demands for
performance, protests and notices, including, without limitation, notices of
nonperformance, notices of protest, notices of dishonor, notices of acceptance
of this Guaranty, and notices of the existence, creation or incurring of new or
additional indebtedness.  Each Guarantor assumes all responsibility for being
and keeping itself informed of the Borrower’s and each other Guaranteed Party’s
financial condition and assets, and of all other circumstances bearing upon the
risk of nonpayment of the Guaranteed Obligations and the nature, scope and
extent of the risks which such Guarantor assumes and incurs hereunder, and
agrees that the Secured Creditors shall have no duty to advise any Guarantor of
information known to them regarding such circumstances or risks.
 
Each Guarantor warrants and agrees that each of the waivers set forth above in
this Section 8 is made with full knowledge of its significance and consequences
and that if any of such waivers are determined to be contrary to any applicable
law or public policy, such waivers shall be effective only to the maximum extent
permitted by law.
 
9.   (a)      The Secured Creditors agree that this Guaranty may be enforced
only by the action of the Administrative Agent or the Collateral Agent, in each
case acting upon the instructions of the Lenders (or, after the date on which
all Credit Document Obligations have been paid in full, the holders of at least
a majority of the outstanding Other Obligations) and that no other Secured
Creditors shall have any right individually to seek to enforce or to enforce
this Guaranty, it being understood and agreed that such rights and remedies may
be exercised by the Administrative Agent or the Collateral Agent or, after all
the Credit Document Obligations have been paid in full, by the holders of at
least a majority of the outstanding Other Obligations, as the case may be, for
the benefit of the Secured Creditors upon the terms of this Guaranty.  The
Secured Creditors further agree that this Guaranty may not be enforced against
any director, officer, employee, partner, member or stockholder of any Guarantor
(except to the extent such partner, member or stockholder is also a Guarantor
hereunder).
 
      (b)     The Administrative Agent and Collateral Agent will hold in
accordance with this Guaranty all collateral at any time received under this
Guaranty.  It is expressly understood and agreed by each Secured Creditor that
by accepting the benefits of this Guaranty each such Secured Creditor
acknowledges and agrees that the obligations of the Administrative Agent and
Collateral Agent as enforcer of this Guaranty and interests herein are only
those expressly set forth in this Guaranty and in Section 12 of the Credit
Agreement.  The Administrative Agent and the Collateral Agent shall act
hereunder on the terms and conditions set forth herein and in Section 12 of the
Credit Agreement.
 
 

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Exhibit E
page 7
 
10.  In order to induce the Lenders to make Loans to the Borrower pursuant to
the Credit Agreement, and in order to induce the Other Creditors to execute,
deliver and perform the Interest Rate Protection Agreements and Other Hedging
Agreements, each Guarantor represents, warrants and covenants that:
 
(a)  Such Guarantor (i) is a duly organized and validly existing corporation,
limited partnership or limited liability company, as the case may be, in good
standing under the laws of the jurisdiction of its incorporation or formation,
(ii) has the corporate or other applicable power and authority, as the case may
be, to own its property and assets and to transact the business in which it is
currently engaged and presently proposes to engage and (iii) is duly qualified
and is authorized to do business and is in good standing in each jurisdiction
where the conduct of its business as currently conducted requires such
qualification, except for failures to be so qualified which, individually or in
the aggregate, could not reasonably be expected to have a Material Adverse
Effect.
 
(b)  Such Guarantor has the corporate or other applicable power and authority to
execute, deliver and perform the terms and provisions of this Guaranty and each
other Credit Document to which it is a party and has taken all necessary
corporate or other applicable action to authorize the execution, delivery and
performance by it of this Guaranty and each such other Credit Document.  Such
Guarantor has duly executed and delivered this Guaranty and each other Credit
Document to which it is a party, and this Guaranty and each such other Credit
Document constitutes the legal, valid and binding obligation of such Guarantor
enforceable against such Guarantor in accordance with its terms, except to the
extent that the enforceability hereof or thereof may be limited by applicable
bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium or
other similar laws generally affecting creditors’ rights and by equitable
principles (regardless of whether enforcement is sought in equity or at law).
 
(c)  Neither the execution, delivery or performance by such Guarantor of this
Guaranty or any other Credit Document to which it is a party, nor compliance by
it with the terms and provisions hereof and thereof, will (i) contravene any
provision of any applicable law, statute, rule or regulation or any applicable
order, writ, injunction or decree of any court or governmental instrumentality,
(ii) conflict with or result in any breach of any of the terms, covenants,
conditions or provisions of, or constitute a default under, or result in the
creation or imposition of (or the obligation to create or impose) any Lien
(except pursuant to the Security Documents) upon any of the material properties
or assets of such Guarantor or any of its Subsidiaries pursuant to the terms of
any indenture, mortgage, deed of trust, loan agreement or credit agreement, or
any other material agreement, contract or instrument, to which such Guarantor or
any of its Subsidiaries is a party or by which it or any of its material
property or assets is bound or to which it may be subject or (iii) violate any
provision of the Certificate of Incorporation or By-Laws (or equivalent
organizational documents) of such Guarantor or any of its Subsidiaries.
 
(d)  No order, consent, approval, license, authorization or validation of, or
filing, recording or registration with (except as have been obtained or made or,
in the case of any filings or recordings of the Security Documents (other than
the Vessel Mortgages) executed on or before
 
 
 
 

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Exhibit E
page 8
 
 
the Initial Borrowing Date, will be made within 10 days of the Initial Borrowing
Date), or exemption by, any governmental or public body or authority, or any
subdivision thereof, is required to authorize, or is required in connection
with, (i) the execution, delivery and performance of this Guaranty by such
Guarantor or any other Credit Document to which such Guarantor is a party or
(ii) the legality, validity, binding effect or enforceability of this Guaranty
or any other Credit Document to which such Guarantor is a party.
 
(e)  There are no actions, suits, investigations or proceedings pending or, to
such Guarantor’s knowledge, threatened (i) with respect to this Guaranty or any
other Credit Document to which such Guarantor is a party or (ii) with respect to
such Guarantor or any of its Subsidiaries that, either individually or in the
aggregate, could reasonably be expected to have a Material Adverse Effect.
 
11.  Each Guarantor covenants and agrees that on and after the Effective Date
and until the termination of the Commitments and all Interest Rate Protection
Agreements and Other Hedging Agreements entered into with respect to the Loans
and until such time as no Term Notes and no Revolving Notes remain outstanding
and all Guaranteed Obligations have been paid in full, such Guarantor will
comply, and will cause each of its Subsidiaries to comply, with all of the
applicable provisions, covenants and agreements contained in Sections 8 and 9 of
the Credit Agreement, and will take, or will refrain from taking, as the case
may be, all actions that are necessary to be taken or not taken so that it is
not in violation of any provision, covenant or agreement contained in Section 8
or 9 of the Credit Agreement, and so that no Default or Event of Default is
caused by the actions of such Guarantor or any of its Subsidiaries.
 
12.  The Guarantors hereby jointly and severally agree to pay all reasonable
out-of-pocket costs and expenses of (i) each Secured Creditor in connection with
the enforcement of this Guaranty (including, without limitation, the reasonable
fees and disbursements of counsel employed by each Secured Creditor) and (ii)
the Administrative Agent in connection with any amendment, waiver or consent
relating hereto (including, without limitation, the reasonable fees and
disbursements of counsel employed by the Administrative Agent).
 
13.  This Guaranty shall be binding upon each Guarantor and its successors and
assigns and shall inure to the benefit of the Secured Creditors and their
successors and assigns.
 
14.  Neither this Guaranty nor any provision hereof may be changed, waived,
discharged or terminated except with the written consent of each Guarantor
directly affected thereby and with the written consent of (x) the Administrative
Agent (or, to the extent required by Section 13.12 of the Credit Agreement, with
the written consent of the Required Lenders) at all times prior to the time on
which all Credit Document Obligations have been paid in full or (y) the holders
of at least a majority of the outstanding Other Obligations at all times after
the time on which all Credit Document Obligations have been paid in full;
provided, that any change, waiver, modification or variance affecting the rights
and benefits of a single Class (as defined below) of Secured Creditors (and not
all Secured Creditors in a like or similar manner) shall also require the
written consent of the Requisite Creditors (as defined below) of such Class of
Secured Creditors (it being understood that the addition or release of any
Guarantor hereunder
 
 
 

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Exhibit E
page 9
 
shall not constitute a change, waiver, discharge or termination affecting any
Guarantor other than the Guarantor so added or released).  For the purpose of
this Guaranty, the term “Class” shall mean each class of Secured Creditors,
i.e., whether (x) the Lender Creditors as holders of the Credit Document
Obligations or (y) the Other Creditors as the holders of the Other
Obligations.  For the purpose of this Guaranty, the term “Requisite Creditors”
of any Class shall mean (x) with respect to the Credit Document Obligations, the
Required Lenders (or, to the extent required by Section 13.12 of the Credit
Agreement, each Lender) and (y) with respect to the Other Obligations, the
holders of at least a majority of all obligations outstanding from time to time
under the Interest Rate Protection Agreements and Other Hedging Agreements
entered into with respect to the Loans (and/or the Commitments).
 
15.  Each Guarantor acknowledges that an executed (or conformed) copy of each of
the Credit Documents and each existing Interest Rate Protection Agreements or
Other Hedging Agreements has been made available to a senior officer of such
Guarantor and such officer is familiar with the contents thereof.
 
16.  In addition to any rights now or hereafter granted under applicable law
(including, without limitation, Section 151 of the New York Debtor and Secured
Creditor Law) and not by way of limitation of any such rights, upon the
occurrence and during the continuance of an Event of Default (such term to mean
and include any “Event of Default” as defined in the Credit Agreement and any
payment default under any Interest Rate Protection Agreement or Other Hedging
Agreement continuing after any applicable grace period), each Secured Creditor
is hereby authorized, at any time or from time to time, without notice to any
Guarantor or to any other Person, any such notice being expressly waived, to set
off and to appropriate and apply any and all deposits (general or special) and
any other indebtedness at any time held or owing by such Secured Creditor to or
for the credit or the account of such Guarantor, against and on account of the
obligations and liabilities of such Guarantor to such Secured Creditor under
this Guaranty, irrespective of whether or not such Secured Creditor shall have
made any demand hereunder and although said obligations, liabilities, deposits
or claims, or any of them, shall be contingent or unmatured.
 
17.  Except as otherwise expressly provided herein, all notices and other
communications provided for hereunder shall be in writing (including telexed,
telegraphic or telecopier communication) and mailed, telexed, telecopied or
delivered:  if to any Guarantor, at c/o Genco Ship Management LLC., as agent, 35
West 56th Street, New York, New York 10019; if to any Secured Creditor, at its
address specified opposite its name on Schedule II to the Credit Agreement; and
if to the Administrative Agent, at its address specified opposite its name on
Schedule II to the Credit Agreement; or, as to any other Credit Party, at such
other address as shall be designated by such party in a written notice to the
other parties hereto and, as to each Secured Creditor, at such other address as
shall be designated by such Secured Creditor in a written notice to the Borrower
and the Administrative Agent.  All such notices and communications shall, (i)
when mailed, be effective three Business Days after being deposited in the
mails, prepaid and properly addressed for delivery, (ii) when sent by overnight
courier, be effective one Business Day after delivery to the overnight courier
prepaid and properly addressed for delivery on such next Business Day, or (iii)
when sent by telex or telecopier, be effective
 
 
 

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Exhibit E
page 10
 
when sent by telex or telecopier, except that notices and communications to the
Administrative Agent or any Guarantor shall not be effective until received by
the Administrative Agent or such Guarantor, as the case may be.

18.  If claim is ever made upon any Secured Creditor for repayment or recovery
of any amount or amounts received in payment or on account of any of the
Guaranteed Obligations and any of the aforesaid payees repays all or part of
said amount by reason of (i) any judgment, decree or order of any court or
administrative body having jurisdiction over such payee or any of its property
or (ii) any settlement or compromise of any such claim effected by such payee
with any such claimant (including the Borrower or any other Guaranteed Party)
then and in such event each Guarantor agrees that any such judgment, decree,
order, settlement or compromise shall be binding upon such Guarantor,
notwithstanding any revocation hereof or other instrument evidencing any
liability of the Borrower or any other Guaranteed Party, and such Guarantor
shall be and remain liable to the aforesaid payees hereunder for the amount so
repaid or recovered to the same extent as if such amount had never originally
been received by any such payee.
 
19.  (a)  THIS SUBSIDIARIES GUARANTY AND THE OTHER CREDIT DOCUMENTS AND THE
RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER AND THEREUNDER SHALL, EXCEPT AS
OTHERWISE PROVIDED IN CERTAIN OF THE VESSEL MORTGAGES, BE CONSTRUED IN
ACCORDANCE WITH AND BE GOVERNED BY THE LAW OF THE STATE OF NEW YORK WITHOUT
REGARD TO ITS CONFLICT OF LAWS RULES (OTHER THAN TITLE 14 OF ARTICLE 5 OF THE
GENERAL OBLIGATIONS LAW).  Any legal action or proceeding with respect to this
Guaranty or any other Credit Document to which any Guarantor is a party may be
brought in the courts of the State of New York or of the United States of
America for the Southern District of New York in each case which are located in
the City of New York, and, by execution and delivery of this Guaranty, each
Guarantor hereby irrevocably accepts for itself and in respect of its property,
generally and unconditionally, the jurisdiction of the aforesaid courts.  Each
Guarantor hereby further irrevocably waives (to the fullest extent permitted by
applicable law) any claim that any such court lacks personal jurisdiction over
such Guarantor, and agrees not to plead or claim in any legal action or
proceeding with respect to this Guaranty or any other Credit Document to which
such Guarantor is a party brought in any of the aforesaid courts that any such
court lacks personal jurisdiction over such Guarantor.  Each Guarantor further
irrevocably consents to the service of process out of any of the aforementioned
courts in any such action or proceeding by the mailing of copies thereof by
registered or certified mail, postage prepaid, to such Guarantor at its address
set forth in Section 17 hereof, such service to become effective 30 days after
such mailing.  Each Guarantor hereby irrevocably waives (to the fullest extent
permitted by applicable law) any objection to such service of process and
further irrevocably waives and agrees not to plead or claim in any action or
proceeding commenced hereunder or under any other Credit Document to which such
Guarantor is a party that such service of process was in any way invalid or
ineffective. Nothing herein shall affect the right of any of the Secured
Creditors to serve process in any other manner permitted by law or to commence
legal proceedings or otherwise proceed against each Guarantor in any other
jurisdiction.
 
 

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Exhibit E
page 11
 
(b)  Each Guarantor hereby irrevocably waives (to the fullest extent permitted
by applicable law) any objection which it may now or hereafter have to the
laying of venue of any of the aforesaid actions or proceedings arising out of or
in connection with this Guaranty or any other Credit Document to which such
Guarantor is a party brought in the courts referred to in clause (a) above and
hereby further irrevocably waives (to the fullest extent permitted by applicable
law) and agrees not to plead or claim in any such court that such action or
proceeding brought in any such court has been brought in an inconvenient forum.
 
(c)  EACH GUARANTOR AND EACH SECURED CREDITOR (BY ITS ACCEPTANCE OF THE BENEFITS
OF THIS GUARANTY) HEREBY IRREVOC­ABLY WAIVES ALL RIGHTS TO A TRIAL BY JURY IN
ANY ACTION, PRO­CEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS
GUARANTY, THE OTHER CREDIT DOCUMENTS TO WHICH SUCH GUARANTOR IS A PARTY OR THE
TRANSACTIONS CONTEMPLATED HERE­BY OR THEREBY.
 
20.  In the event that all of the capital stock or other equity interests of one
or more Guarantors is sold or otherwise disposed of or liquidated in compliance
with the requirements of Section 11.02 of the Credit Agreement (or such sale or
other disposition has been approved in writing by the Required Lenders (or all
the Lenders if required by Section 15.12 of the Credit Agreement)) and the
proceeds of such sale, disposition or liquidation are applied in accordance with
the provisions of the Credit Agreement, to the extent applicable, such Guarantor
shall upon consummation of such sale or other disposition (except to the extent
that such sale or disposition is to the Borrower or another Subsidiary thereof)
be released from this Guaranty automatically and without further action and this
Guaranty shall, as to each such Guarantor or Guarantors, terminate, and have no
further force or effect (it being understood and agreed that the sale of one or
more Persons that own, directly or indirectly, all of the capital stock or other
equity interests of any Guarantor shall be deemed to be a sale of such Guarantor
for the purposes of this Section 20).
 
21.  At any time a payment in respect of the Guaranteed Obligations is made
under this Guaranty, the right of contribution of each Guarantor against each
other Guarantor shall be determined as provided in the immediately following
sentence, with the right of contribution of each Guarantor to be revised and
restated as of each date on which a payment (a “Relevant Payment”) is made on
the Guaranteed Obligations under this Guaranty.  At any time that a Relevant
Payment is made by a Guarantor that results in the aggregate payments made by
such Guarantor in respect of the Guaranteed Obligations to and including the
date of the Relevant Payment exceeding such Guarantor’s Contribution Percentage
(as defined below) of the aggregate payments made by all Guarantors in respect
of the Guaranteed Obligations to and including the date of the Relevant Payment
(such excess, the “Aggregate Excess Amount”), each such Guarantor shall have a
right of contribution against each other Guarantor who has made payments in
respect of the Guaranteed Obligations to and including the date of the Relevant
Payment in an aggregate amount less than such other Guarantor’s Contribution
Percentage of the aggregate payments made to and including the date of the
Relevant Payment by all Guarantors in respect of the Guaranteed Obligations (the
aggregate amount of such deficit, the “Aggregate Deficit Amount”) in an amount
equal to (x) a fraction the numerator of which is the Aggregate
 
 

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Exhibit E
page 12
 
Excess Amount of such Guarantor and the denominator of which is the Aggregate
Excess Amount of all Guarantors multiplied by (y) the Aggregate Deficit Amount
of such other Guarantor.  A Guarantor’s right of contribution pursuant to the
preceding sentences shall arise at the time of each computation, subject to
adjustment to the time of each computation; provided, that no Guarantor may take
any action to enforce such right until the Guaranteed Obligations have been paid
in full in cash, it being expressly recognized and agreed by all parties hereto
that any Guarantor’s right of contribution arising pursuant to this Section 21
against any other Guarantor shall be expressly junior and subordinate to such
other Guarantor’s obligations and liabilities in respect of the Guaranteed
Obligations and any other obligations owing under this Guaranty.  As used in
this Section 21:  (i) each Guarantor’s “Contribution Percentage” shall mean the
percentage obtained by dividing (x) the Adjusted Net Worth (as defined below) of
such Guarantor by (y) the aggregate Adjusted Net Worth of all Guarantors; (ii)
the “Adjusted Net Worth” of each Guarantor shall mean the greater of (x) the Net
Worth (as defined below) of such Guarantor and (y) zero; and (iii) the “Net
Worth” of each Guarantor shall mean the amount by which the fair saleable value
of such Guarantor’s assets on the date of any Relevant Payment exceeds its
existing debts and other liabilities (including contingent liabilities, but
without giving effect to any Guaranteed Obligations arising under this Guaranty
or any guaranteed obligations arising under any guaranty of the Senior Notes) on
such date.  All parties hereto recognize and agree that, except for any right of
contribution arising pursuant to this Section 21, each Guarantor who makes any
payment in respect of the Guaranteed Obligations shall have no right of
contribution or subrogation against any other Guarantor in respect of such
payment until all of the Guaranteed Obligations have been irrevocably paid in
full in cash.  Each of the Guarantors recognizes and acknowledges that the
rights to contribution arising hereunder shall constitute an asset in favor of
the party entitled to such contribution.  In this connection, each Guarantor has
the right to waive its contribution right against any Guarantor to the extent
that after giving effect to such waiver such Guarantor would remain solvent, in
the determination of the Required Lenders.
 
22.  Each Guarantor and each Secured Creditor (by its acceptance of the benefits
of this Guaranty) hereby confirms that it is its intention that this Guaranty
not constitute a fraudulent transfer or conveyance for purposes of the
Bankruptcy Code, the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent
Transfer Act or any similar Federal, state or other law.  To effectuate the
foregoing intention, each Guarantor and each Secured Creditor (by its acceptance
of the benefits of this Guaranty) hereby irrevocably agrees that the Guaranteed
Obligations guaranteed by such Guarantor shall be limited to such amount as
will, after giving effect to such maximum amount and all other (contingent or
otherwise) liabilities of such Guarantor that are relevant under such laws and
after giving effect to any rights to contribution pursuant to any agreement
providing for an equitable contribution among such Guarantor and the other
Guarantors, result in the Guaranteed Obligations of such Guarantor in respect of
such maximum amount not constituting a fraudulent transfer or conveyance.
 
23.  This Guaranty may be executed in any number of counterparts and by the
different parties hereto on separate counterparts, each of which when so
executed and delivered shall be an original (including if delivered by facsimile
transmission), but all of which shall
 
 
 

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Exhibit E
page 13
 
 
together constitute one and the same instrument.  A set of counterparts executed
by all the parties hereto shall be lodged with the Guarantors and the
Administrative Agent.
 
24.  (a) All payments made by any Guarantor hereunder will be made without
setoff, counterclaim or other defense, will be made in the currency or
currencies in which the respective Guaranteed Obligations are then due and
payable and will be made on the same basis as payments are made by the Borrower
under Sections 4.04 and 4.05 of the Credit Agreement.
 
(b) The Guarantors’ obligations hereunder to make payments in the respective
currency or currencies in which the respective Guaranteed Obligations are
required to be paid (such currency being herein called the “Obligation
Currency”) shall not be discharged or satisfied by any tender or recovery
pursuant to any judgment expressed in or converted into any currency other than
the Obligation Currency, except to the extent that such tender or recovery
results in the effective receipt by the Administrative Agent, the Collateral
Agent or the respective other Secured Creditor of the full amount of the
Obligation Currency expressed to be payable to the Administrative Agent, the
Collateral Agent or such other Secured Creditor under this Guaranty or the other
Credit Documents or any Interest Rate Protection Agreement or Other Hedging
Agreement, as applicable.  If for the purpose of obtaining or enforcing judgment
against any Guarantor in any court or in any jurisdiction, it becomes necessary
to convert into or from any currency other than the Obligation Currency (such
other currency being hereinafter referred to as the “Judgment Currency”) an
amount due in the Obligation Currency, the conversion shall be made, at the rate
of exchange (quoted by the Administrative Agent, determined, in each case, as of
the date immediately preceding the day on which the judgment is given (such
Business Day being hereinafter referred to as the “Judgment Currency Conversion
Date”).
 
(c)  If there is a change in the rate of exchange prevailing between the
Judgment Currency Conversion Date and the date of actual payment of the amount
due, the Guarantors jointly and severally covenant and agree to pay, or cause to
be paid, such additional amounts, if any (but in any event not a lesser amount),
as may be necessary to ensure that the amount paid in the Judgment Currency,
when converted at the rate of exchange prevailing on the date of payment, will
produce the amount of the Obligation Currency which could have been purchased
with the amount of Judgment Currency stipulated in the judgment or judicial
award at the rate or exchange prevailing on the Judgment Currency Conversion
Date.
 
(d)  For purposes of determining the Relevant Currency Equivalent or any other
rate of exchange for this Section 24, such amounts shall include any premium and
costs payable in connection with the purchase of the Obligation Currency.
 
25.  It is understood and agreed that any Subsidiary of the Borrower that is
required to execute a counterpart of this Guaranty after the date hereof
pursuant to the Credit Agreement shall automatically become a Guarantor
hereunder by executing a counterpart hereof and/or a Subsidiary assumption
agreement, in each case in form and substance satisfactory to the Administrative
Agent, and delivering the same to the Administrative Agent.
 
 
 

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Exhibit E
page 14

 
IN WITNESS WHEREOF, each Guarantor has caused this Guaranty to be executed and
delivered as of the date first above written.
 
                                                            [                                  
]
                                                            as Guarantors
 
 
 
                                                                       
By:__________________________
                                                                      Name:
                                                                             
Title:
 
 
 
DNB NOR BANK ASA,

 
NEW YORK BRANCH

By:__________________________
 

 
Name:

 
Title:

 
 
By:__________________________
   

 
Name:

 
Title:

 
 

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Exhibit F
 
 
PLEDGE AND SECURITY AGREEMENT
 
PLEDGE AND SECURITY AGREEMENT (as amended, modified, restated and/or
supplemented from time to time, this “Agreement”), dated as of July 20, 2007,
made by each of the undersigned pledgors (each a “Pledgor” and, together with
any other entity that becomes a pledgor hereunder pursuant to Section 25 hereof,
the “Pledgors”) to DNB NOR BANK ASA, New York Branch, as collateral agent (in
such capacity, together with any successor collateral agent, the “Pledgee”), for
the benefit of the Secured Creditors (as defined below) and NORDEA BANK FINLAND
PLC, New York Branch, as Deposit Account Bank (in such capacity, as the “Deposit
Account Bank”).
 
W I T N E S S E T H :
 
WHEREAS, Genco Shipping & Trading Limited (the “Borrower”), the various lenders
from time to time party thereto (the “Lenders”) and DnB Nor Bank ASA, New York
Branch, as Administrative Agent and Collateral Agent (in such capacity, together
with any successor Administrative Agent, the “Administrative Agent”), have
entered into a Credit Agreement, dated as of July 20, 2007 (as amended,
modified, restated and/or supplemented from time to time, the “Credit
Agreement”), providing for the making of Loans to the Borrower as contemplated
therein (the Lenders holding from to time outstanding Loans (and/or Loan
Commitments), the Administrative Agent and each Pledgee, in each of the
aforementioned capacities, are herein called the “Lender Creditors”);
 
WHEREAS, pursuant to Section 1.2 hereof, each applicable Pledgor and the Deposit
Account Bank are entering into the Control Agreement attached hereto as Annex H
simultaneously herewith;
 
WHEREAS, the Borrower may at any time and from time to time after the date
hereof enter into, or guaranty the obligations of one or more other Pledgors or
any of their respective Subsidiaries under, one or more Interest Rate Protection
Agreements or Other Hedging Agreements with respect to the Borrower’s
obligations under the Credit Agreement with respect to the outstanding Loans
and/or Commitments from time to time with one or more Lenders or any affiliate
thereof (each such Lender or affiliate, even if the respective Lender
subsequently ceases to be a Lender under the Credit Agreement for any reason,
together with such Lender's or affiliate's successors and assigns, if any,
collectively, the “Other Creditors” and, together with the Lenders holding from
to time outstanding Loans (and/or Commitments), are herein called the “Secured
Creditors”);
 
WHEREAS, it is a condition precedent to the making of the Loans to the Borrower
under the Credit Agreement that each Pledgor shall have executed and delivered
to the Pledgee this Agreement; and
 
WHEREAS, each Pledgor desires to enter into this Agreement in order to satisfy
the condition described in the preceding paragraph;
 
 

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Exhibit F
page 2
 
NOW, THEREFORE, in consideration of the foregoing and other benefits accruing to
each Pledgor, the receipt and sufficiency of which are hereby acknowledged, each
Pledgor hereby makes the following representations and warranties to the Pledgee
for the benefit of the Secured Creditors and hereby covenants and agrees with
the Pledgee for the benefit of the Secured Creditors as follows:
 
1.  SECURITY FOR OBLIGATIONS; ESTABLISHMENT OF OPERATING ACCOUNT.
 
1.1. Security.  This Agreement is made by each Pledgor for the benefit of the
Secured Creditors to secure:
 
              (i)the full and prompt payment when due (whether at the stated
maturity, by acceleration or otherwise) of all obligations, liabilities and
indebtedness (including, without limitation, principal, premium, interest, fees
and indemnities (including, without limitation, all interest that accrues after
the commencement of any case, proceeding or other action relating to the
bankruptcy, insolvency, reorganization or similar proceeding of any Pledgor at
the rate provided for in the respective documentation, whether or not a claim
for post-petition interest is allowed in any such proceeding)) of such Pledgor
to the Lender Creditors whether now existing or hereafter incurred under,
arising out of, or in connection with, the Credit Agreement and the other Credit
Documents to which such Pledgor is a party (including, in the case of each
Pledgor that is a Subsidiary Guarantor, all such obligations, liabilities and
indebtedness of such Pledgor under the Subsidiaries Guaranty) and the due
performance and compliance by such Pledgor with all of the terms, conditions and
agreements contained in the Credit Agreement and in such other Credit Documents
(all such obligations, liabilities and indebtedness under this clause (i),
except to the extent consisting of obligations, liabilities or indebtedness with
respect to Interest Rate Protection Agreements or Other Hedging Agreements,
being herein collec­tively called the “Credit Document Obligations”);
 
              (ii)the full and prompt payment when due (whether at the stated
maturity, by acceleration or otherwise) of all obligations, liabilities and
indebtedness (including, without limitation, all interest that accrues after the
commencement of any case, proceeding or other action relating to the bankruptcy,
insolvency, reorganization or similar proceeding of any Pledgor at the rate
provided for in the respective documentation, whether or not a claim for
post-petition interest is allowed in any such proceeding) owing by such Pledgor
to the Other Creditors under, or with respect to (including, in the case of each
Pledgor that is a Subsidiary Guarantor, all such obligations, liabilities and
indebtedness of such Pledgor under the Subsidiaries Guaranty), any Interest Rate
Protection Agreement or Other Hedging Agreement entered into in respect of the
Borrower’s obligations with respect to the outstanding Loans and/or Commitments
from time to time, whether such Interest Rate Protection Agreement or Other
Hedging Agreement is now in existence or hereafter arising, and the due
performance and compliance by such Pledgor with all of the terms, conditions and
agreements contained therein (all such obligations, liabilities and indebtedness
described in this clause (ii) being herein collectively called the “Other
Obligations”);
 
(iii)any and all sums advanced by the Pledgee in order to preserve the
Collateral (as hereinafter defined) or preserve its security interest in the
Collateral;
 
 

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Exhibit F
page 3
              
 
              (iv)in the event of any proceeding for the collection or
enforcement of any indebtedness, obligations or liabilities of such Pledgor
referred to in clauses (i) and (ii) above, after an Event of Default shall have
occurred and be continuing, the reasonable expenses of retaking, holding,
preparing for sale or lease, selling or otherwise disposing of or realizing on
the Collateral, or of any exercise by the Pledgee of its rights hereunder,
together with reasonable attorneys’ fees and court costs; and
 
              (v)all amounts paid by any Secured Creditor as to which such
Secured Creditor has the right to reimbursement under Section 11 of this
Agreement;
 
all such obligations, liabilities, sums and expenses set forth in clauses (i)
through (v) of this Section 1.1 being herein collectively called the
“Obligations,” it being acknowledged and agreed that the “Obligations” shall
include extensions of credit of the types described above, whether outstanding
on the date of this Agreement or extended from time to time after the date of
this Agreement.
 
1.2.  Operating Accounts; Reserve Accounts.  (a) The relevant Pledgor and the
Pledgee have established, or shall establish, in the name and for the benefit of
the Pledgee, as agent for the Secured Creditors, the Operating Accounts for
purposes of this Agreement and the other relevant Credit Documents, which
Operating Accounts are or shall be maintained with the Deposit Account Bank
located at 437 Madison Avenue, 21st Floor, New York, New York 10022 (the
“Deposit Account Bank”).  Each relevant Pledgor, the Pledgee and the Deposit
Account Bank are, simultaneously herewith, entering into, or shall enter into,
the Control Agreement attached hereto as Annex H (the “Control
Agreement”) simultaneously herewith, which provides that the Operating Accounts
shall be under the control of the Pledgee, as agent for the Secured Creditors,
and the Pledgee shall have the right to direct withdrawals from the Operating
Accounts and to exercise all rights with respect to all of the Earnings
Collateral (as defined below).  All  Earnings Collateral delivered to, or held
by or on behalf of, the Pledgee pursuant to each of the Assignments of Earnings
shall be held in the Operating Accounts in accordance with the provisions hereof
and of the Control Agreement.
 
(b)           Until such time as the Collateral Agent shall have delivered a
Notice of Exclusive Control (as defined in the Control Agreement) (which the
Collateral Agent agrees to do only during the continuance of an Event of
Default), the relevant Pledgor may apply amounts in the Operating Accounts to
the payment of operating expenses and other expenditures permitted under the
Credit Agreement of the Borrower and the other Pledgors.  After the delivery of
a Notice of Exclusive Control (as defined in the Control Agreement), only the
Collateral Agent shall be entitled to withdraw funds from the Operating
Accounts, to give any instructions in respect of the Operating Accounts and any
funds held therein or credited thereto or otherwise deal with the Operating
Accounts.
 
2.  DEFINITIONS.  (a)  Unless otherwise defined herein, all capitalized terms
used herein and defined in the Credit Agreement shall be used herein as therein
defined.  Reference to singular terms shall include the plural and vice versa.
 
(b)           The following capitalized terms used herein shall have the
definitions specified below:

 
 

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Exhibit F
page 4
 
“Administrative Agent” has the meaning set forth in the Recitals hereto.
 
“Adverse Claim” has the meaning given such term in Section 8-102(a)(1) of the
UCC.
 
“Agreement” has the meaning set forth in the first paragraph hereof.
 
“Borrower” has the meaning set forth in the Recitals hereto.
 
“Certificated Security” has the meaning given such term in Section 8-102(a)(4)
of the UCC.
 
“Clearing Corporation” has the meaning given such term in Section 8-102(a)(5) of
the UCC.
 
“Collateral” has the meaning set forth in Section 3.1 hereof.
 
“Control Agreement” shall have the meaning provided in Section 1.2.
 
“Credit Agreement” has the meaning set forth in the Recitals hereto.
 
“Credit Document Obligations” has the meaning set forth in Section 1.1(i)
hereof.
 
“Deposit Account Bank” shall have the meaning provided such term in Section 1.2
hereof.
 
“Earnings Collateral” shall mean, collectively, all of the collateral granted,
sold, conveyed, assigned, transferred, mortgaged and pledged pursuant to, and in
accordance with, Section 1 of each Assignment of Earnings.
 
“Event of Default” means any Event of Default under, and as defined in, the
Credit Agreement and any payment default under any Interest Rate Protection
Agreement or Other Hedging Agreement entered into in respect of the Borrower’s
obligations with respect to the outstanding Loans and/or Commitments from time
to time, after any applicable grace period.
 
“Indemnitees” has the meaning set forth in Section 11 hereof.
 
“Lender Creditors” has the meaning set forth in the Recitals hereto.
 
“Lenders” has the meaning set forth in the Recitals hereto.
 
“Limited Liability Company Assets” means all assets, whether tangible or
intang­ible and whether real, personal or mixed (including, without limitation,
all limited liability com­pany capital and interest in other limited liability
companies), at any time owned or represented by any Limited Liability Company
Interest. 
 
“Limited Liability Company Interests” means the entire limited liability company
membership interest at any time owned by any Pledgor in any limited liability
company.
 
“Obligations” has the meaning set forth in Section 1.1 hereof.
 
 

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Exhibit F
page 5
 
“Operating Accounts” shall mean, collectively, the accounts listed on Annex I
hereto and all other accounts established at any time by any Pledgor and pledged
in favor of the Pledgee pursuant to the terms of this Agreement or the Credit
Agreement.
 
“Other Creditors” has the meaning set forth in the Recitals hereto.
 
“Other Obligations” has the meaning set forth in Section 1.1(ii) hereof.
 
“Partnership Assets” means all assets, whether tangible or intangible and
whether real, personal or mixed (including, without limitation, all partnership
capital and interest in other partnerships), at any time owned or represented by
any Partnership Interest.
 
“Partnership Interest” shall mean the entire general partnership interest or
limited partnership interest at any time owned by any Pledgor in any general
partnership or limited partnership.
 
“Person” means any individual, partnership, joint venture, firm, corporation,
association, limited liability company, trust or other enterprise or any
government or political subdivision or any agency, department or instrumentality
thereof.
 
“Pledgee” has the meaning set forth in the first paragraph hereof.
 
“Pledgor” has the meaning set forth in the first paragraph hereof.
 
“Proceeds” has the meaning given such term in Section 9-102(64) of the UCC.
 
“Required Secured Creditors” means (i) at any time when any Credit Document
Obligations are outstanding or any Commitments under the Credit Agreement exist,
the Required Lenders (or, to the extent provided in Section 15.12 of the Credit
Agreement, each of the Lenders), and (ii) at any time after all of the Credit
Document Obligations have been paid in full in cash and all Commitments under
the Credit Agreement have been terminated and if any Other Obligations are
outstanding, the holders of a majority of the Other Obligations.
 
“Secured Creditors” has the meaning set forth in the Recitals hereto.
 
“Secured Debt Agreements” means and includes this Agreement, the other Credit
Documents and the Interest Rate Protection Agreements and Other Hedging
Agreements entered into with any Other Creditors entered into in respect of the
Borrower’s obligations with respect to the outstanding Loans and/or Commitments
from time to time.
 
“Securities Act” means the Securities Act of 1933, as amended, as in effect from
time to time.
 
“Security” and “Securities” has the meaning given such term in Section
8-102(a)(15) of the UCC and shall in any event also include all Stock.
 
“Security Entitlement” has the meaning given such term in Section 8-102(a)(17)
of the UCC.
 
 

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Exhibit F
page 6
 
“Stock” means all of the issued and outstanding shares of capital stock of any
corporation at any time owned by any Pledgor.
 
“Subsidiary” means, as to any Person, (i) any corporation more than 50% of whose
stock of any class or classes having by the terms thereof ordinary voting power
to elect a majority of the directors of such corporation (irrespective of
whether or not at the time stock of any class or classes of such corporation
shall have or might have voting power by reason of the happening of any
contingency) is at the time owned by such Person and/or one or more Subsidiaries
of such Person and (ii) any partnership, limited liability company, association,
joint venture or other entity in which such Person and/or one or more
Subsidiaries of such Person has more than a 50% equity interest at the time.
 
“Termination Date” has the meaning set forth in Section 20 hereof.
 
“UCC” means the Uniform Commercial Code as in effect in the State of New York
from time to time; provided that all references herein to specific sections or
sub­sections of the UCC are references to such sections or subsections, as the
case may be, of the Uniform Commercial Code as in effect in the State of New
York on the date hereof.
 
“Uncertificated Security” has the meaning given such term in Section
8-102(a)(18) of the UCC.
 
3.  PLEDGE OF STOCK, ACCOUNTS, ETC.
 
3.1  Pledge.  To secure the Obligations now or hereafter owed or to be performed
by such Pledgor, each Pledgor does hereby grant and pledge to the Pledgee for
the benefit of the Secured Creditors, and does hereby create a continuing first
priority security interest in favor of the Pledgee for the benefit of the
Secured Creditors in, all of the right, title and interest in and to the
following, whether now existing or hereafter from time to time acquired
(collectively, the “Collateral”):
 
(a)           the Operating Accounts, together with all of such Pledgor’s right,
title and interest in and to all sums of property (including cash equivalents
and other investments) now or at any time hereafter on deposit therein, credited
thereto or payable thereon, and all instruments, documents and other writings
evidencing the Operating Accounts;
 
(b)            all Stock of any Subsidiary Guarantor owned by such Pledgor from
time to time and all options and warrants owned by such Pledgor from time to
time to purchase Stock of any such Subsidiary Guarantor;
 
(c)           all Limited Liability Company Interests in any Subsidiary
Guarantor owned by such Pledgor from time to time and all of its right, title
and interest in each limited liability company to which each such interest
relates, whether now existing or hereafter acquired, including, without
limitation, to the fullest extent permitted under the terms and provisions of
the documents and agreements governing such Limited Liability Company Interests
and applicable law:
 
 

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Exhibit F
page 7

 
(A)           all the capital thereof and its interest in all profits, losses,
Limited Liability Company Assets and other distributions to which such Pledgor
shall at any time be entitled in respect of such Limited Liability Company
Interests;
 
(B)           all other payments due or to become due to such Pledgor in respect
of Limited Liability Company Interests, whether under any limited liability
company agreement or otherwise, whether as contractual obligations, damages,
insurance proceeds or otherwise;
 
(C)           all of such Pledgor’s claims, rights, powers, privileges,
authority, options, security interests, liens and remedies, if any, under any
limited liability company agree­ment or operating agreement, or at law or
otherwise in respect of such Limited Liability Company Interests;
 
(D)           all present and future claims, if any, of such Pledgor against any
such limited liability company for moneys loaned or advanced, for services
rendered or otherwise;
 
(E)           all of such Pledgor’s rights under any limited liability company
agreement or operating agreement or at law to exercise and enforce every right,
power, remedy, authority, option and privilege of such Pledgor relating to such
Limited Liability Company Interests, including any power to terminate, cancel or
modify any limited liability company agreement or operating agreement, to
execute any instruments and to take any and all other action on behalf of and in
the name of such Pledgor in respect of such Limited Liability Company Interests
and any such limited liability company, to make determinations, to exercise any
election (including, but not limited to, election of remedies) or option or to
give or receive any notice, consent, amendment, waiver or approval, together
with full power and authority to demand, receive, enforce, collect or receipt
for any of the foregoing or for any Limited Liability Company Asset, to enforce
or execute any checks, or other instruments or orders, to file any claims and to
take any action in connection with any of the foregoing; and
 
(F)           all other property hereafter delivered in substitution for or in
addition to any of the foregoing, all certificates and instruments representing
or evidencing such other property and all cash, securities, interest, dividends,
rights and other property at any time and from time to time received, receivable
or otherwise distributed in respect of or in exchange for any or all thereof; 
 
(d)           all Partnership Interests in any Subsidiary Guarantor owned by
such Pledgor from time to time and all of its right, title and interest in each
partnership to which each such interest relates, whether now existing or
hereafter acquired, including, without limitation, to the fullest extent
permitted under the terms and provisions of the documents and agreements
governing such Partnership Interests and applicable law
 
 

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Exhibit F
page 8
 
 
 
(A)           all the capital thereof and its interest in all profits, losses,
Partnership Assets and other distributions to which such Pledgor shall at any
time be entitled in respect of such Partnership Interests;
 
(B)           all other payments due or to become due to such Pledgor in respect
of such Partnership Interests, whether under any partnership agreement or
otherwise, whether as contractual obligations, damages, insurance proceeds or
otherwise;
 
(C)           all of its claims, rights, powers, privileges, authority, options,
security interests, liens and remedies, if any, under any partnership agreement
or operating agreement, or at law or otherwise in respect of such Partnership
Interests;
 
(D)           all present and future claims, if any, of such Pledgor against any
such partnership for moneys loaned or advanced, for services rendered or
otherwise;
 
(E)           all of such Pledgor’s rights under any partnership agreement or
operating agreement or at law to exercise and enforce every right, power,
remedy, authority, option and privilege of such Pledgor relating to such
Partnership Interests, including any power to terminate, cancel or modify any
partnership agreement or operating agreement, to execute any instruments and to
take any and all other action on behalf of and in the name of any of such
Pledgor in respect of such Partnership Interests and any such partnership, to
make determinations, to exercise any election (including, but not limited to,
election of remedies) or option or to give or receive any notice, consent,
amendment, waiver or approval, together with full power and authority to demand,
receive, enforce, collect or receipt for any of the foregoing or for any
Partnership Asset, to enforce or execute any checks, or other instruments or
orders, to file any claims and to take any action in connection with any of the
foregoing; and
 
(F)           all other property hereafter delivered in substitution for or in
addition to any of the foregoing, all certificates and instruments representing
or evidencing such other property and all cash, securities, interest, dividends,
rights and other property at any time and from time to time received, receivable
or otherwise distributed in respect of or in exchange for any or all thereof;
and
 
 (e)           all Proceeds of any and all of the foregoing.
 
3.2.  Procedures. (a)  To the extent that any Pledgor at any time or from time
to time owns, acquires or obtains any right, title or interest in any
Collateral, such Collateral shall automatically (and without the taking of any
action by such Pledgor) be pledged pursuant to Section 3.1 of this Agreement
and, in addition thereto, such Pledgor shall (to the extent provided below)
take, or, in the case of Section 3.2(a)(v), authorize the Pledgee to take, the
following actions as set forth below (as promptly as practicable and, in any
event, within 30 days after it obtains such Collateral) for the benefit of the
Pledgee and the Secured Creditors:
 
              (i)with respect to a Certificated Security (other than a
Certificated Security credited on the books of a Clearing Corporation), such
Pledgor shall deliver such Certificated Security to the Pledgee with powers
executed in blank;
 
 

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Exhibit F
page 9
 
 
              (ii)with respect to an Uncertificated Security (other than an
Uncertificated Security credited on the books of a Clearing Corporation), such
Pledgor shall cause the issuer of such Uncertificated Security (or, in the case
of an issuer that is not a Subsidiary of such Pledgor, will use reasonable
efforts to cause such issuer) to duly authorize and execute, and deliver to the
Pledgee, an agreement for the benefit of the Pledgee and the other Secured
Creditors substantially in the form of Annex G hereto (appropriately completed
to the reasonable satisfaction of the Pledgee and with such modifications, if
any, as shall be reasonably satisfactory to the Pledgee) pursuant to which such
issuer agrees to comply with any and all instructions originated by the Pledgee
without further consent by the registered owner and not to comply with
instructions regarding such Uncertificated Security originated by any other
Person other than a court of competent jurisdiction;
 
              (iii)with respect to a Certificated Security, Uncertificated
Security, Partnership Interest or Limited Liability Company Interest credited on
the books of a Clearing Corporation (including a Federal Reserve Bank,
Participants Trust Company or The Depository Trust Company), such Pledgor shall
promptly notify the Pledgee thereof and shall promptly take all actions required
(i) to comply in all material respects with the applicable rules of such
Clearing Corporation and (ii) to perfect the security interest of the Pledgee
under applicable law (including, in any event, under Sections 9-314(a), (b) and
(c), 9-106 and 8-106(d) of the UCC).  Such Pledgor further agrees to take such
actions as the Pledgee deems reasonably necessary to effect the foregoing;
 
              (iv)with respect to a Partnership Interest or a Limited Liability
Company Interest (other than a Partnership Interest or Limited Liability
Interest credited on the books of a Clearing Corporation), (1) if such
Partnership Interest or Limited Liability Company Interest is represented by a
certificate and is a Security for purposes of the UCC, the procedure set forth
in Section 3.2(a)(i) hereof, and (2) if such Partnership Interest or Limited
Liability Company Interest is not represented by a certificate or is not a
Security for purposes of the UCC, the procedure set forth in Section 3.2(a)(ii)
hereof; and
 
              (v)with respect to cash proceeds from any of the Collateral
described in Section 3.1 hereof which are not released to such Pledgor in
accordance with Section 6 hereof, (i) establishment by the Pledgee of a cash
account in the name of such Pledgor over which the Pledgee shall have exclusive
and absolute control and dominion (and no withdrawals or transfers may be made
therefrom by any Person except with the prior written consent of the Pledgee)
and (ii) deposit of such cash in such cash account.
 
(b)   In addition to the actions required to be taken pursuant to Section 3.2(a)
hereof, each Pledgor shall take the following additional actions with respect to
the Collateral:
 
(i)with respect to all Collateral of such Pledgor whereby or with respect to
which the Pledgee may obtain “control” thereof within the meaning of Section
8-106 of the UCC (or under any provision of the UCC as same may be amended or
supplemented from time to time, or under the laws of any relevant State other
than the State of New York), such Pledgor shall take all actions as may be
reasonably requested from time to time by the Pledgee so that “control” of such
Collateral is obtained and at all times held by the Pledgee; and   
             
 

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Exhibit F
page 10
           
 
                            (ii)each Pledgor shall from time to time cause
appropriate financing statements (on Form UCC-1 or other appropriate form) under
the Uniform Commercial Code as in effect in the various relevant states,
covering all Collateral hereunder (with the form of such financing statements to
be satisfactory to the Pledgee), to be filed in the relevant filing offices so
that at all times the Pledgee has a security interest in all Collateral which is
perfected by the filing of such financing statements (in each case to the
maximum extent perfection by filing may be obtained under the laws of the
relevant states, including, without limitation, Section 9-312(a) of the UCC).
 
3.3.  Subsequently Acquired Collateral.  If any Pledgor shall acquire (by
purchase, stock dividend or similar distribution or otherwise) any additional
Collateral at any time or from time to time after the date hereof, such
Collateral shall automatically (and without any further action being required to
be taken) be subject to the pledge and security interests created pursuant to
Section 3.1 hereof and, furthermore, such Pledgor will promptly thereafter take
(or cause to be taken) all action with respect to such Collateral in accordance
with the procedures set forth in Section 3.2 hereof, and will promptly
thereafter deliver to the Pledgee (i) a certificate executed by a principal
executive officer of such Pledgor describing such Collateral and certifying that
the same has been duly pledged in favor of the Pledgee (for the benefit of the
Secured Creditors) hereunder and (ii) supplements to Annexes A through F hereto
as are reasonably necessary to cause such annexes to be complete and accurate at
such time.
 
3.4.  Transfer Taxes.  Each pledge of Collateral under Section 3.1 or Section
3.3 hereof shall be accompanied by any transfer tax stamps required in
connection with the pledge of such Collateral.
 
3.5.  Certain Representations and Warranties Regarding the Collateral.  Each
Pledgor represents and warrants that on the date hereof: (i) the jurisdiction of
organization of such Pledgor, and such Pledgor’s organizational identification
number, is listed on Annex A hereto; (ii) each Subsidiary of such Pledgor that
is a Subsidiary Guarantor is listed in Annex B hereto; (iii) the Stock (and any
warrants or options to purchase Stock) of any Subsidiary Guarantor held by such
Pledgor consists of the number and type of shares of the stock (or warrants or
options to purchase any stock) of the corporations as described in Annex C
hereto; (iv) such Stock constitutes that percentage of the issued and
outstanding capital stock of the respective Subsidiary Guarantors as is set
forth in Annex C hereto; (v) the Limited Liability Company Interests in any and
all Subsidiary Guarantors held by such Pledgor consist of the number and type of
interests of the respective Subsidiary Guarantors described in Annex D hereto;
(vi) each such Limited Liability Company Interest constitutes that percentage of
the issued and outstanding equity interest of the respective Subsidiary
Guarantors as set forth in Annex D hereto; (vii) the Partnership Interests held
by such Pledgor in any and all Subsidiary Guarantors consist of the number and
type of interests of the respective Subsidiary Guarantors described in Annex E
hereto; (viii) each such Partnership Interest constitutes that percentage or
portion of the entire partnership interest of the Partnership as set forth in
Annex E hereto; (ix) such Pledgor has complied with the respec­tive procedure
set forth in Section 3.2(a) hereof with respect to each item of Collateral
described in Annexes B through E hereto; and (xi) on the date hereof, such
Pledgor owns no other Stock, Limited Liability Company Interests or Partnership
Interests of, in each case, any Subsidiary Guarantor.
 
 

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Exhibit F
page 11
 
 
 
4.  APPOINTMENT OF SUB-AGENTS; ENDORSEMENTS, ETC.  If and to the extent
necessary to enable the Pledgee to perfect its security interest in any of the
Collateral or to exercise any of its remedies hereunder, the Pledgee shall have
the right to appoint one or more sub-agents for the purpose of retaining
physical possession of the Collateral, which may be held (in the discretion of
the Pledgee) in the name of the relevant Pledgor, endorsed or assigned in blank
or in favor of the Pledgee or any nominee or nominees of the Pledgee or a
sub-agent appointed by the Pledgee.
 
5.  VOTING, ETC., WHILE NO EVENT OF DEFAULT.  Unless and until there shall have
occurred and be continuing an Event of Default, each Pledgor shall be entitled
to exercise any and all voting and other consensual rights pertaining to the
Collateral owned by it, and to give consents, waivers or ratifications in
respect thereof; provided that, in each case, no vote shall be cast or any
consent, waiver or ratification given or any action taken or omitted to be taken
which would violate or be inconsistent with any of the terms of any Secured Debt
Agreement, or which could reasonably be expected to have the effect of impairing
the value of the Collateral or any part thereof or the position or interests of
the Pledgee or any other Secured Creditor in the Collateral unless expressly
permitted by the terms of the Secured Debt Agreements.  All such rights of each
Pledgor to vote and to give consents, waivers and ratifications shall cease in
case an Event of Default has occurred and is continuing, and Section 7 hereof
shall become applicable.
 
 
6.  DIVIDENDS AND OTHER DISTRIBUTIONS.  Unless and until there shall have
occurred and be continuing an Event of Default, all cash dividends, cash
distributions, cash Proceeds and other cash amounts payable in respect of the
Collateral shall be paid to the Pledgors.  The Pledgee shall be entitled to
receive directly, and to retain as part of the Collateral:
 
                (i)all other or additional stock, notes, limited liability
company interests, partner­ship interests, instruments or other securities or
property (including, but not limited to, cash dividends other than as set forth
above in the first sentence of this Section 6) paid or distributed by way of
dividend or otherwise in respect of the Collateral;
 
 (ii)   all other or additional stock, notes, limited liability company
interests, partner­ship interests, instruments or other securities or property
(including, but not limited to, cash) paid or distributed in respect of the
Collateral by way of stock-split, spin-off, split-up, reclassification,
combination of shares or similar rearrangement; and 
 
 (iii)  all other or additional stock, notes, limited liability company
interests, partner­ship interests, instruments or other securities or property
(including, but not limited to, cash) which may be paid in respect of the
Collateral by reason of any consolidation, merger, exchange of stock, conveyance
of assets, liquidation or similar corporate or other reorganization.
 
All dividends, distributions or other payments which are received by any Pledgor
contrary to the provisions of this Section 6 and Section 7 hereof shall be
received in trust for the benefit of the Pledgee, shall be segregated from other
property or funds of such Pledgor and shall be forthwith paid over and/or
delivered to the Pledgee as Collateral in the same form as so received (with any
necessary endorsement).
 
 
 
 

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Exhibit F
page 12
 
 
7.  REMEDIES IN CASE OF AN EVENT OF DEFAULT.  If there shall have occurred and
be continuing an Event of Default, then and in every such case, the Pledgee
shall be entitled to exercise all of the rights, powers and remedies (whether
vested in it by this Agreement, any other Secured Debt Agreement or by law) for
the protection and enforcement of its rights in respect of the Collateral, and
the Pledgee shall be entitled to exercise all the rights and remedies of a
secured party under the Uniform Commercial Code as in effect in any relevant
jurisdiction and also shall be entitled, without limitation, to exercise the
following rights, which each Pledgor hereby agrees to be commercially
reasonable:
 
              (i)to receive all amounts payable in respect of the Collateral
otherwise payable under Section 6 hereof to the Pledgors;
 
              (ii)to transfer all or any part of the Collateral into the
Pledgee’s name or the name of its nominee or nominees;
 
              (iii)to vote all or any part of the Collateral (whether or not
transferred into the name of the Pledgee) and give all consents, waivers and
ratifications in respect of the Collateral and otherwise act with respect
thereto as though it were the outright owner thereof (each Pledgor hereby
irrevocably constituting and appointing the Pledgee the proxy and
attorney-in-fact of such Pledgor, with full power of substitution to do so);
 
              (iv)at any time and from time to time to sell, assign and deliver,
or grant options to purchase, all or any part of the Collateral, or any interest
therein, at any public or private sale, without demand of performance,
advertisement or notice of intention to sell or of the time or place of sale or
adjournment thereof or to redeem or otherwise (all of which are hereby waived by
each Pledgor), for cash, on credit or for other property, for immediate or
future delivery without any assumption of credit risk, and for such price or
prices and on such terms as the Pledgee in its absolute discretion may
determine, provided that at least 10 days’ written notice of the time and place
of any such sale shall be given to the Pledgors.  The Pledgee shall not be
obligated to make any such sale of Collateral regardless of whether any such
notice of sale has theretofore been given.  Each Pledgor hereby waives and
releases to the fullest extent permitted by law any right or equity of
redemption with respect to the Collateral, whether before or after sale
hereunder, and all rights, if any, of marshalling the Collateral and any other
security for the Obligations or otherwise.  At any such sale, unless prohibited
by applicable law, the Pledgee on behalf of the Secured Creditors may bid for
and purchase all or any part of the Collateral so sold free from any such right
or equity of redemption. Neither the Pledgee nor any other Secured Creditor
shall be liable for failure to collect or realize upon any or all of the
Collateral or for any delay in so doing nor shall any of them be under any
obligation to take any action whatsoever with regard thereto;
 
    (v)to set-off any and all Collateral against any and all Obligations; and
 
            (vi)apply any monies constituting collateral or proceeds thereof
(including, without limitation, amounts on deposit in the Operating Accounts) in
accordance with the provisions of
Section 9.
 
 

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Exhibit F
page 13
 
 
              
8.  REMEDIES, ETC., CUMULATIVE.  Each and every right, power and remedy of the
Pledgee provided for in this Agreement or in any other Secured Debt Agreement,
or now or hereafter existing at law or in equity or by statute shall be
cumulative and concurrent and shall be in addition to every other such right,
power or remedy. The exercise or beginning of the exercise by the Pledgee or any
other Secured Creditor of any one or more of the rights, powers or remedies
provided for in this Agreement or any other Secured Debt Agreement or now or
hereafter existing at law or in equity or by statute or otherwise shall not
preclude the simultaneous or later exercise by the Pledgee or any other Secured
Creditor of all such other rights, powers or remedies, and no failure or delay
on the part of the Pledgee or any other Secured Creditor to exercise any such
right, power or remedy shall operate as a waiver thereof.  No notice to or
demand on any Pledgor in any case shall entitle it to any other or further
notice or demand in similar or other circumstances or constitute a waiver of any
of the rights of the Pledgee or any other Secured Creditor to any other or
further action in any circumstances without notice or demand.  The Secured
Creditors agree that this Agreement may be enforced only by the action of the
Pledgee, in each case acting upon the instructions of the Required Lenders (or,
after the date on which all Credit Document Obligations have been paid in full,
the holders of at least a majority of the outstanding Other Obligations) and
that no other Secured Creditor shall have any right individually to seek to
enforce or to enforce this Agreement or to realize upon the security to be
granted hereby, it being understood and agreed that such rights and remedies may
be exercised by the Pledgee for the benefit of the Secured Creditors upon the
terms of this Agreement.
 
9.  APPLICATION OF PROCEEDS.  (a)  All monies collected by the Pledgee upon any
sale or other disposition of the Collateral of each Pledgor and any other
collateral under any other Security Document (including, without limitation, the
Vessel Mortgage, Assignments of Earnings, Assignments of Insurance, together
with all other monies received by the Pledgee hereunder and under any other
Security Document (except to the extent released in accordance with the
applicable provisions of this Agreement or any other Credit Document), shall be
applied to the payment of the Obligations as follows:
 
(i)           first, to the payment of all amounts owing the Pledgee of the type
described in clauses (iii) and (iv) of Section 1.1;
 
(ii)           second, to the extent proceeds remain after the application
pursuant to the preceding clause (i), an amount equal to the outstanding Primary
Obligations (as defined below) constituting Credit Document Obligations shall be
paid to the Lenders as provided in Section 9(d) hereof, with each Lender
receiving an amount equal to such outstanding Primary Obligations constituting
Credit Document Obligations or, if the proceeds are insufficient to pay in full
all such Primary Obligations constituting Credit Document Obligations, its Pro
Rata Share (as defined below) of the amount remaining to be distributed;
 
(iii)           third, to the extent proceeds remain after the application
pursuant to the preceding clauses (i) and (ii), an amount equal to the
outstanding Primary Obligations constituting Other Obligations shall be paid to
the Other Creditors as provided in Section 9(d) hereof, with each Other Creditor
receiving an amount equal to such outstanding Primary Obligations constituting
Other Obligations or, if the proceeds are insufficient to pay in full all such
Primary Obligations constituting Other Obligations, its Pro Rata Share of the
amount remaining to be distributed;
 

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Exhibit F
page 14
 
(iv)           fourth, to the extent proceeds remain after the application
pursuant to the preceding clauses (i) through (iii), inclusive, an amount equal
to the outstanding Secondary Obligations shall be paid to the Secured Creditors
as provided in Section 9(d) hereof, with each Secured Creditor receiving an
amount equal to its outstanding Secondary Obligations or, if the proceeds are
insufficient to pay in full all such Secondary Obligations, its Pro Rata Share
of the amount remaining to be distributed; and
 
(v)           fifth, to the extent proceeds remain after the application
pursuant to the preceding clauses (i) through (iv), inclusive, and following the
termination of this Agreement pursuant to Section 20 hereof, to the relevant
Pledgor or to whomever may be lawfully entitled to receive such surplus.
 
(b)           For purposes of this Agreement, (x) “Pro Rata Share” shall mean,
when calculating a Secured Creditor's portion of any distribution or amount,
that amount (expressed as a percentage) equal to a fraction the numerator of
which is the then unpaid amount of such Secured Creditor's Primary Obligations
or Secondary Obligations, as the case may be, and the denominator of which is
the then outstanding amount of all Primary Obligations or Secondary Obligations,
as the case may be, (y) “Primary Obligations” shall mean (i) in the case of the
Credit Document Obligations, all principal of, and interest on, all Loans and
all fees, costs and expenses incurred under the Credit Agreement with respect
thereto and (ii) in the case of the Other Obligations, all amounts due under
such Interest Rate Protection Agreements and Other Hedging Agreements (other
than indemnities, fees (including, without limitation, attorneys' fees) and
similar obligations and liabilities) and (z) “Secondary Obligations” shall mean
all Obligations other than Primary Obligations.
 
(c)           When payments to Secured Creditors are based upon their respective
Pro Rata Shares, the amounts received by such Secured Creditors hereunder shall
be applied (for purposes of making determinations under this Section 9 only) (i)
first, to their Primary Obligations and (ii) second, to their Secondary
Obligations.  If any payment to any Secured Creditor of its Pro Rata Share of
any distribution would result in overpayment to such Secured Creditor, such
excess amount shall instead be distributed in respect of the unpaid Primary
Obligations or Secondary Obligations, as the case may be, of the other Secured
Creditors, with each Secured Creditor whose Primary Obligations or Secondary
Obligations, as the case may be, have not been paid in full to receive an amount
equal to such excess amount multiplied by a fraction the numerator of which is
the unpaid Primary Obligations or Secondary Obligations, as the case may be, of
such Secured Creditor and the denominator of which is the unpaid Primary
Obligations or Secondary Obligations, as the case may be, of all Secured
Creditors entitled to such distribution.
 
(d)           All payments required to be made hereunder shall be made (x) if to
the Lender Creditors, to the Administrative Agent under the Credit Agreement for
the account of the Lender Creditors, and (y) if to the Other Creditors, to the
trustee, paying agent or other similar representative (each a “Representative”)
for the Other Creditors or, in the absence of such a Representative, directly to
the Other Creditors.
 
(e)           For purposes of applying payments received in accordance with this
Section 9, the Pledgee shall be entitled to rely upon (i) the Administrative
Agent under the Credit Agreement and (ii) the Representative for the Other
Creditors or, in the absence of such a Representative, upon
 
 

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Exhibit F
page 15
 

 the Other Creditors for a determination (which the Administrative Agent, each
Representative for any Other Creditors and the Secured Creditors agree (or shall
agree) to provide upon request of the Pledgee) of the outstanding Primary
Obligations and Secondary Obligations owed to the Lender Creditors or the Other
Creditors, as the case may be.  Unless it has actual knowledge (including by way
of written notice from a Lender Credi­tor or an Other Creditor) to the contrary,
the Administrative Agent and each Representative, in furnishing information
pursuant to the preceding sentence, and the Pledgee, in acting hereunder, shall
be entitled to assume that no Secondary Obligations are outstanding. Unless it
has actual knowledge (including by way of written notice from an Other Creditor)
to the contrary, the Pledgee, in acting hereunder, shall be entitled to assume
that no Interest Rate Protection Agreements are in existence.
 
(f)           It is understood and agreed that each Pledgor shall remain jointly
and severally liable to the extent of any deficiency between the amount of the
proceeds of the Collateral pledged by it hereunder and the aggregate amount of
the Obligations of such Pledgor.
 
10.  PURCHASERS OF COLLATERAL.  Upon any sale of the Collateral by the Pledgee
hereunder (whether by virtue of the power of sale herein granted, pursuant to
judicial process or otherwise), the receipt of the Pledgee or the officer making
the sale shall be a sufficient discharge to the purchaser or purchasers of the
Collateral so sold, and such purchaser or purchasers shall not be obligated to
see to the application of any part of the purchase money paid over to the
Pledgee or such officer or be answerable in any way for the misapplication or
non­application thereof.
 
11.  INDEMNITY.  Each Pledgor jointly and severally agrees (i) to indemnify and
hold harmless the Pledgee and each other Secured Creditor and their respective
successors, assigns, employees, agents and affiliates (individually an
“Indemnitee,” and collectively the “Indemnitees”) from and against any and all
claims, demands, losses, judgments and liabilities (including liabilities for
penalties) of whatsoever kind or nature, and (ii) to reimburse each Indemnitee
for all reasonable costs and expenses, including reasonable attorneys’ fees, in
each case growing out of or resulting from this Agreement or the exercise by any
Indemnitee of any right or remedy granted to it hereunder or under any other
Secured Debt Agreement (but excluding any claims, demands, losses, judgments and
liabilities or expenses to the extent incurred by reason of gross negligence or
willful misconduct of such Indemnitee (as determined by a court of competent
jurisdiction in a final and non-appealable decision)).  In no event shall the
Pledgee be liable, in the absence of gross negligence or willful misconduct on
its part, for any matter or thing in connection with this Agreement other than
to account for monies actually received by it in accordance with the terms
hereof.  If and to the extent that the obligations of any Pledgor under this
Section 11 are unenforceable  for any reason, such Pledgor hereby agrees to make
the maximum contribution to the payment and satisfaction of such obligations
which is permissible under applicable law.
 
12.  PLEDGEE NOT A PARTNER OR LIMITED LIABILITY COMPANY MEMBER.  (a) Nothing
herein shall be construed to make the Pledgee or any other Secured Creditor
liable as a member of any limited liability company or as a partner of any
partnership and neither the Pledgee nor any other Secured Creditor by virtue of
this Agreement or otherwise (except as referred to in the following sentence)
shall have any of the duties, obligations or liabilities of a member of any
limited liability company or partnership.  The parties hereto expressly agree
that, unless the Pledgee shall become the absolute owner of Collateral
consisting of a Limited Liability
 
 

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Exhibit F
page 16
 
 Company Interest or Partnership Interest pursuant hereto, this Agreement shall
not be construed as creating a partnership or joint venture among the Pledgee,
any other Secured Creditor, any Pledgor and/or any other Person.
 
(b)           Except as provided in the last sentence of paragraph (a) of this
Section 12, the Pledgee, by accepting this Agreement, did not intend to become a
member of any limited liability company or a partner of any partnership or
otherwise be deemed to be a co-venturer with respect to any Pledgor, any limited
liability company, partnership and/or any other Person either before or after an
Event of Default shall have occurred.  The Pledgee shall have only those powers
set forth herein and the Secured Creditors shall assume none of the duties,
obligations or liabilities of a member of any limited liability company or as a
partner of any partnership or any Pledgor except as provided in the last
sentence of paragraph (a) of this Section 12.
 
(c)           The Pledgee and the other Secured Creditors shall not be obligated
to perform or discharge any obligation of any Pledgor as a result of the pledge
hereby effected.
 
(d)           The acceptance by the Pledgee of this Agreement, with all the
rights, powers, privileges and authority so created, shall not at any time or in
any event obligate the Pledgee or any other Secured Creditor to appear in or
defend any action or proceeding relating to the Collateral to which it is not a
party, or to take any action hereunder or thereunder, or to expend any money or
incur any expenses or perform or discharge any obligation, duty or liability
under the Collateral.
 
13.  FURTHER ASSURANCES; POWER-OF-ATTORNEY.  (a)  Each Pledgor agrees that it
will join with the Pledgee in executing and, at such Pledgor’s own expense, file
and refile under the Uniform Commercial Code or other applicable law such
financing statements, continuation statements and other documents in such
offices as the Pledgee may deem reasonably necessary and wherever required by
law in order to perfect and preserve the Pledgee’s security interest in the
Collateral and hereby authorizes the Pledgee to file financing statements
(including, without limitation, ‘all assets’ financing statements) and
amendments thereto relative to all or any part of the Collateral without the
signature of such Pledgor where permitted by law, and agrees to do such further
acts and things and to execute and deliver to the Pledgee such additional
convey­ances, assignments, agreements and instruments as the Pledgee may
reasonably require or deem necessary to carry into effect the purposes of this
Agreement or to further assure and confirm unto the Pledgee its rights, powers
and remedies hereunder.
 
(b)           Each Pledgor hereby appoints the Pledgee such Pledgor’s
attorney-in-fact, with full authority in the place and stead of such Pledgor and
in the name of such Pledgor or otherwise, to act from time to time solely after
the occurrence and during the continuance of an Event of Default in the
Pledgee’s reasonable discretion to take any action and to execute any instrument
which the Pledgee may deem reasonably necessary or advisable to accomplish the
purposes of this Agreement.
 
14.  THE PLEDGEE AS AGENT.  The Pledgee will hold in accordance with this
Agreement all items of the Collateral at any time received under this Agreement.
It is expressly understood and agreed by each Secured Creditor that by accepting
the benefits of this Agreement each such Secured Creditor acknowledges and
agrees that the obligations of the Pledgee as holder of the Collateral and
interests therein and with respect to the disposition thereof, and otherwise
under
 
 

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Exhibit F
page 17

 
this Agreement, are only those expressly set forth in this Agreement and in
Section 12 of the Credit Agreement.  The Pledgee shall act hereunder on the
terms and conditions set forth herein and in Section 13 of the Credit Agreement.
 
15.  TRANSFER BY THE PLEDGORS.  No Pledgor will sell or otherwise dispose of,
grant any option with respect to, or mortgage, pledge or otherwise encumber any
of the Collateral or any interest therein (except as may be permitted in
accordance with the terms of the Secured Debt Agreements).
 
16.  REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE PLEDGORS.  Each Pledgor
represents, warrants and covenants that:
 
                (i)it is the legal, beneficial and record owner of, and has good
and marketable title to, all Collateral pledged by such Pledgor hereunder and
that it has sufficient interest in all Collateral pledged by such Pledgor
hereunder in which a security interest is purported to be created hereunder for
such security interest to attach (subject, in each case, to no pledge, lien,
mortgage, hypothecation, security interest, charge, option, Adverse Claim or
other encumbrance whatsoever, except the liens and security interests created by
this Agreement and Permitted Liens);
 
       (ii)it has the corporate, limited partnership or limited liability
company power and authority, as the case may be, to pledge all the Collateral
pledged by it pursuant to this Agreement;
 
              (iii)this Agreement has been duly authorized, executed and
delivered by such Pledgor and constitutes a legal, valid and binding obligation
of such Pledgor enforceable against such Pledgor in accordance with its terms,
except to the extent that the enforce­ability hereof may be limited by
applicable bankruptcy, insolvency, reorganization, mora­torium or other similar
laws generally affecting creditors’ rights and by equitable principles
(regardless of whether enforcement is sought in equity or at law);
 
              (iv)except to the extent already obtained or made, or, in the case
of any filings or recordings of the Security Documents (other than the Vessel
Mortgages) executed on or before the Initial Borrowing Date, to be made within
10 days of the Initial Borrowing Date, no consent of any other party (including,
without limitation, any stockholder, partner, member or creditor of such Pledgor
or any of its Subsidiaries) and no consent, license, permit, approval or
authorization of, exemption by, notice or report to, or registration, filing or
declaration with, any governmental authority is required to be obtained by such
Pledgor in connection with (a) the execution, delivery or performance by such
Pledgor of this Agreement, (b) the legality, validity, binding effect or
enforceability of this Agreement, (c) the perfection or enforceability of the
Pledgee’s security interest in the Collateral pledged by such Pledgor hereunder
or (d) except for compliance with or as may be required by applicable securities
laws, the exercise by the Pledgee of any of its rights or remedies provided
herein;
 
       (v)the execution, delivery and performance of this Agreement will not
violate any provision of any applicable law or regulation or of any order,
judgment, writ, award or decree    
 
 

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Exhibit F
page 18
 
 
of any court, arbitrator or governmental authority, U.S. or non-U.S., applicable
to such Pledgor, or of the certificate or articles of incorporation, certificate
of formation, operating agreement, limited liability company agreement,
partnership agreement or by-laws of such Pledgor, as applicable, or of any
securities issued by such Pledgor or any of its Subsidiaries, or of any
mortgage, deed of trust, indenture, lease, loan agreement, credit agreement or
other material contract, agree­ment or instrument or undertaking to which such
Pledgor or any of its Subsidiaries is a party or which purports to be binding
upon such Pledgor or any of its Subsidiaries or upon any of their respective
assets and will not result in the creation or imposition of (or the obligation
to create or impose) any lien or encumbrance on any of the assets of such
Pledgor or any of its Subsidiaries which are Credit Parties, except as
contemplated by this Agreement or the Credit Agreement;
 
              (vi)all of the Collateral has been duly and validly issued and
acquired, is fully paid and non-assessable and is subject to no options to
purchase or similar rights;
 
              (vii)the pledge and collateral assignment to, and possession by,
the Pledgee of the Collateral pledged by such Pledgor hereunder consisting of
Certificated Securities pursuant to this Agreement creates a valid and perfected
first priority security interest in such Certificated Securities, and the
proceeds thereof, subject to no prior Lien or to any agreement purporting to
grant to any third party a Lien on the property or assets of such Pledgor which
would include the Certificated Securities, except for Permitted Liens, and the
Pledgee is entitled to all the rights, priorities and benefits afforded by the
UCC or other relevant law as enacted in any relevant jurisdiction to perfect
security interests in respect of such Collateral; and;
 
     (viii)“control” (as defined in Section 8-106 of the UCC) has been obtained
by the Pledgee over all Collateral pledged by such Pledgor hereunder consisting
of Stock with respect to which such “control” may be obtained pursuant to
Section 8-106 of the UCC, and “control” (as defined in Section 9-104 of the UCC)
has been obtained by the Pledgee over all Operating Accounts with respect to
which such “control” may be obtained pursuant to Section 9-104 of the UCC.
 
(b)           Each Pledgor covenants and agrees that it will defend the
Pledgee’s right, title and security interest in and to the Collateral and the
proceeds thereof against the claims and demands of all persons whomsoever; and
each Pledgor covenants and agrees that it will have like title to and right to
pledge any other property at any time hereafter pledged to the Pledgee as
Collateral hereunder and will likewise defend the right thereto and security
interest therein of the Pledgee and the Secured Creditors.
 
17. JURISDICTION OF ORGANIZATION; CHIEF EXECUTIVE OFFICE; RECORDS.  The
jurisdiction of organization of each Pledgor is specified in Annex A
hereto.  The chief executive office of each Pledgor is located at the address
specified in Annex F hereto.  Each Pledgor will not change the jurisdiction of
its organization or move its chief executive office except to such new
jurisdiction or location as such Pledgor may establish in accordance with the
last sentence of this Section 17.  The originals of all documents in the
possession of such Pledgor evidencing all Collateral, including but not limited
to all Limited Liability Company Interests and Partnership Interests, and the
only original books of account and records of such Pledgor relating 
 
 

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Exhibit F
page 19
            
 
thereto are, and will continue to be, kept at such chief executive office as
specified in Annex F hereto, or at such new locations as such Pledgor may
establish in accordance with the last sentence of this Section 17.  All Limited
Liability Company Interests and Partnership Interests are, and will continue to
be, maintained at, and controlled and directed (including, without limitation,
for general accounting purposes) from, such chief executive office as specified
in Annex F hereto, or such new locations as such Pledgor may establish in
accordance with the last sentence of this Section 17.  No Pledgor shall
establish a new jurisdiction of organization or a new location for such chief
executive offices until (i) it shall have given to the Pledgee not less than 15
days’ prior written notice of its intention so to do, providing clear details of
such new jurisdiction of organization or new location, as the case may be, and
providing such other information in connection therewith as the Pledgee may
reasonably request, and (ii) with respect to such new jurisdiction of
organization or new location, as the case may be, it shall have taken all
action, satisfactory to the Pledgee (and, to the extent applicable, in
accordance with Section 3.2 hereof), to maintain the security interest of the
Pledgee in the Collateral intended to be granted hereby at all times fully
perfected and in full force and effect.  Promptly after establishing a new
jurisdiction of organization or new location for such chief executive offices in
accordance with the immediately preceding sentence, the respective Pledgor shall
deliver to the Pledgee a supplement to Annex A hereto or Annex F hereto, as the
case may be, so as to cause such Annex A or F, as the case may be, to be
complete and accurate.
 
18. PLEDGORS’ OBLIGATIONS ABSOLUTE, ETC.  The obligations of each Pledgor under
this Agreement shall be absolute and unconditional and shall remain in full
force and effect without regard to, and shall not be released, suspended,
discharged, terminated or otherwise affected by, any circumstance or occurrence
whatsoever, including, without limitation:  (i) any renewal, extension,
amendment or modification of or addition or supplement to or deletion from any
Secured Debt Agreement or any other instrument or agreement referred to therein,
or any assignment or transfer of any thereof; (ii) any waiver, consent,
extension, indulgence or other action or inaction under or in respect of any
such agreement or instrument including, without limitation, this Agreement;
(iii) any furnishing of any additional security to the Pledgee or its assignee
or any acceptance thereof or any release of any security by the Pledgee or its
assignee; (iv) any limitation on any party’s liability or obligations under any
such instrument or agreement or any invalidity or unenforceability, in whole or
in part, of any such instrument or agreement or any term thereof; or (v) any
bankruptcy, insolvency, reorganization, composition, adjustment, dissolution,
liquidation or other like proceeding relating to any Pledgor or any Subsidiary
of any Pledgor, or any action taken with respect to this Agreement by any
trustee or receiver, or by any court, in any such proceeding, whether or not
such Pledgor shall have notice or knowledge of any of the foregoing (it being
understood and agreed that the enforcement hereof may be limited by applicable
bankruptcy, insolvency, restructuring, moratorium or other similar laws
generally affecting creditors’ rights and by equitable principles).
 
19.  REGISTRATION, ETC.  If at any time when the Pledgee shall determine to
exercise its right to sell all or any part of the Collateral consisting of
Stock, Limited Liability Company Interests or Partnership Interests pursuant to
Section 7 hereof, and the Collateral or the part thereof to be sold shall not,
for any reason whatsoever, be effectively registered under the Securities Act,
as then in effect, the Pledgee may, in its sole and absolute discretion, sell
such Collateral, as the case may be, or part thereof by private sale in such
manner and under such circumstances as the Pledgee may deem necessary or
advisable in order that such sale may legally be effected without such
registration.  Without limiting the generality of the foregoing, in any such
 
 

--------------------------------------------------------------------------------

 
 
 
Exhibit F
page 20
 
event the Pledgee, in its sole and absolute discretion (i) may proceed to make
such private sale notwithstanding that a registration statement for the purpose
of registering such Collateral or part thereof shall have been filed under such
Securities Act, (ii) may approach and negotiate with a single possible purchaser
to effect such sale, and (iii) may restrict such sale to a purchaser who will
represent and agree that such purchaser is purchasing for its own account, for
investment, and not with a view to the distribution or sale of such Collateral
or part thereof.  In the event of any such sale, the Pledgee shall incur no
responsibility or liability for selling all or any part of the Collateral at a
price which the Pledgee, in its sole and absolute discretion, in good faith
deems reasonable under the circum­stances, notwithstanding the possibility that
a substantially higher price might be realized if the sale were deferred until
after registration as aforesaid.
 
20.  TERMINATION; RELEASE.  (a)  After the Termination Date, this Agreement and
the security interest created hereby shall terminate (provided that all
indemnities set forth herein including, without limitation, in Section 11 hereof
shall survive any such termination), and the Pledgee, at the request and expense
of any Pledgor, will as promptly as practicable (i) execute and deliver to such
Pledgor a proper instrument or instruments acknowledging the satisfaction and
termination of this Agreement, (ii) will duly assign, transfer and deliver to
such Pledgor (without recourse and without any representation or warranty) such
of the Collateral as has not theretofore been sold or otherwise applied or
released pursuant to this Agreement or any other Credit Document, together with
any monies at the time held by the Pledgee or any of its sub-agents hereunder
and (iii) notify the deposit banks under the Control Agreements that such
Control Agreements are terminated.  As used in this Agreement, “Termination
Date” shall mean the date upon which the Total Commitment under the Credit
Agreement has been terminated and all Interest Rate Protec­tion Agreements and
Other Hedging Agreements applicable to Loans (and/or the Commitments) entered
into with any Other Creditors have been terminated, no Note under the Credit
Agreement is outstanding and all Loans thereunder have been repaid in full and
all Obligations then due and payable have been paid in full.
 
(b)           In the event that any part of the Collateral is sold in connection
with a sale permitted by the Secured Debt Agreements (other than a sale to any
Pledgor or any Subsidiary thereof) or is otherwise released with the consent of
the Required Secured Creditors and the proceeds of such sale or sales or from
such release are applied in accordance with the provisions of the Credit
Agreement, to the extent required to be so applied, the Pledgee, at the request
and expense of the respective Pledgor, will duly assign, transfer and deliver to
such Pledgor (without recourse and without any representation or warranty) such
of the Collateral (and releases therefor) as is then being (or has been) so sold
or released and has not theretofore been released pursuant to this Agreement.
 
(c)           At any time that a Pledgor desires that the Pledgee assign,
transfer and deliver Collateral (and releases therefor) as provided in Section
20(a) or (b) hereof, it shall deliver to the Pledgee a certificate signed by a
principal executive officer of such Pledgor stating that the release of the
respective Collateral is permitted pursuant to such Section 20(a) or (b).
 
(d)           The Pledgee shall have no liability whatsoever to any other
Secured Creditor as a result of any release of Collateral by it in accordance
with this Section 20.
 
 

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Exhibit F
page 21
 
 
21.  NOTICES, ETC.  Except as otherwise expressly provided herein, all notices
and other communications provided for hereunder shall be in writing (including
telexed, telegraphic or telecopier communication) and mailed, telexed,
telecopied or delivered:  if to any Pledgor, at c/o Genco Ship Management LLC,
as agent, 35 West 56th Street, New York, New York 10019, if to any Lender
Creditor, at its address specified opposite its name on Schedule II to the
Credit Agreement; and if to the Pledgee, at its Notice Office; and, as to each
Other Creditor, at such other address as shall be designated by such Secured
Creditor in a written notice to the Borrower and the Administrative Agent.  All
such notices and communications shall, (i) when mailed, be effective three
Business Days after being deposited in the mails, prepaid and properly addressed
for delivery, (ii) when sent by overnight courier, be effective one Business Day
after delivery to the overnight courier prepaid and properly addressed for
delivery on such next Business Day, or (iii) when sent by telex or telecopier,
be effective when sent by telex or telecopier, except that notices and
communications to the Pledgee or any Pledgor shall not be effective until
received by the Pledgee or such Pledgor, as the case may be.
 
22.  WAIVER; AMENDMENT.  None of the terms and conditions of this Agreement may
be changed, waived, modified or varied in any manner whatsoever except in
writing duly signed by each Pledgor directly affected thereby and the Pledgee
(with the written consent of the Required Secured Creditors); provided, that any
change, waiver, modification or variance affecting the rights and benefits of a
single Class (as defined below) of Secured Creditors (and not all Secured
Creditors in a like or similar manner) shall also require the written consent of
the Requisite Creditors (as defined below) of such affected Class.  For the
purpose of this Agreement, the term “Class” shall mean each class of Secured
Creditors, i.e., whether (i) the Lender Creditors as holders of the Credit
Document Obligations or (ii) the Other Creditors as the holders of the Other
Obligations. For the purpose of this Agreement, the term “Requisite Creditors”
of any Class shall mean each of (i) with respect to the Credit Document
Obligations, the Required Lenders and (ii) with respect to the Other
Obligations, the holders of at least a majority of all obligations outstanding
from time to time under the Interest Rate Protection Agreements and Other
Hedging Agreements with respect to outstanding Loans (and/or the Commitments)
from time to time.
 
23.  MISCELLANEOUS.  This Agreement shall be binding upon the parties hereto and
their respective successors and assigns and shall inure to the benefit of and be
enforceable by each of the parties hereto and its successors and assigns,
provided that no Pledgor may assign any of its rights or obligations under this
Agreement except in accordance with the terms of the Secured Debt
Agreements.  THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
HEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND BE GOVERNED BY THE LAW OF
THE STATE OF NEW YORK WITHOUT REGARD TO ITS CONFLICT OF LAWS RULES (OTHER THAN
TITLE 14 OF ARTICLE 5 OF THE NEW YORK GENERAL OBLIGATIONS LAW).  EACH PARTY TO
THIS AGREEMENT IRREVOCABLY WAIVES ALL RIGHT TO A TRIAL BY JURY IN ANY ACTION
PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE
TRANS­ACTIONS CONTEM­­PLATED HEREBY.  The headings in this Agreement are for
purposes of reference only and shall not limit or define the meaning
hereof.  This Agreement may be executed in any number of counterparts, each of
which shall be an orig­inal, but all of which shall constitute one
instrument.  In the event that any provision of this Agreement shall prove to be
invalid or unenforce­able, such provision shall be deemed to be severable from
the other provisions of this Agreement which shall remain binding on all parties
hereto.
 
 

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Exhibit F
page 22

 
24. RECOURSE.  This Agreement is made with full recourse to the Pledgors and
pursuant to and upon all the representations, warranties, covenants and
agreements on the part of the Pledgors contained herein and in the other Credit
Documents and otherwise in writing in connection herewith or therewith.
 
25. ADDITIONAL PLEDGORS. It is understood and agreed that any Subsidiary of the
Borrower that is required to become a party to this Agreement after the date
hereof pursuant to the requirements of the Credit Agreement shall automatically
become a Pledgor hereunder by (x) executing a counterpart hereof and/or a
Subsidiary assumption agreement, in each case in form and  substance
satisfactory to the Pledgee, (y) delivering supplements to Annexes A through F
hereto as are necessary to cause such Annexes to be complete and accurate with
respect to such additional Pledgor on such date and (z) taking all actions as
specified in Section 3 of this Agreement as would have been taken by such
Pledgor had it been an original party to this Agreement, in each case with all
documents required above to be delivered to the Pledgee and with all actions
required to be taken above to be taken to the reasonable satisfaction of the
Pledgee.
 
26. RELEASE OF GUARANTORS.  In the event any Pledgor which is a Subsidiary of
the Borrower is released from its obligations pursuant to the Subsidiaries
Guaranty, such Pledgor (so long as not the Borrower) shall be released from this
Agreement and this Agreement shall, as to such Pledgor only, have no further
force or effect.
 
 
 

--------------------------------------------------------------------------------

 
Exhibit F
page 23
 
IN WITNESS WHEREOF, each Pledgor and the Pledgee have caused this Agreement to
be executed by their duly elected officers duly authorized as of the date first
above written.
 
 
GENCO SHIPPING & TRADING LIMITED,

 
as a Pledgor

 
By:____________________
 

 
Name:

 
Title:

 
 
 
[______________________]

 
as Pledgors

 
By:____________________
 

 
Name:

 
Title:

 
 
 

--------------------------------------------------------------------------------

 
 
 
Accepted and Agreed to:

 
 
 
DNB NOR BANK ASA,

 
NEW YORK BRANCH,

 
as Pledgee

 
By:_____________________
 

 
 Name:

 
 Title:

 
By:_____________________
 

 
Name:

 
Title:

 
 
 
 
 
 

--------------------------------------------------------------------------------

 
 
 
 
 
Accepted and Agreed to:

 
 
NORDEA BANK FINLAND PLC,

 
New York Branch

 
as Deposit Account Bank

 
By:______________________
 

 
 Name:

 
 Title:

 
By:______________________
 

 
Name:

 
Title:

 
 
 
 

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ANNEX A
to
Pledge and Security Agreement
 

 
EXACT LEGAL NAME OF EACH PLEDGOR AND JURISDICTION OF
ORGANIZATION
 
Name of Pledgor
Jurisdiction of Organization
Organizational ID Number

 
 
 
 
 
 

--------------------------------------------------------------------------------

 
 
ANNEX B
to
Pledge and Security Agreement
 
 
 

LIST OF SUBSIDIARIES

 
Pledgor
Direct Subsidiaries

 
 
 

 

--------------------------------------------------------------------------------

 
ANNEX C
to
Pledge and Security Agreement
 
 
LIST OF STOCK
 

 

Name of Subsidiary
Percent (%)
Ownership

 
 
 
 
 
 
 
 

--------------------------------------------------------------------------------

ANNEX D
to
Pledge and Security Agreement

 
 
LIST OF LIMITED LIABILITY COMPANY INTERESTS
 
 
 
Name of Limited
Liability Company
Type of Interest
Percentage
Owned
Sub-clause of 
Section 3.2(a) of
Borrower/Subsidiary
Pledge and Security
Agreement
                       

 
 
 
 
 

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ANNEX E
to
Pledge and Security Agreement

 

 
LIST OF PARTNERSHIP INTERESTS
 
 
 
 
 
 
 
 

--------------------------------------------------------------------------------

 
 
ANNEX F
to
Pledge and Security Agreement

 
LIST OF CHIEF EXECUTIVE OFFICES

Name of Pledgor
Address

 
 
 
 

 

--------------------------------------------------------------------------------

 
 
ANNEX G
to
Pledge and Security Agreement

 
Form of Agreement Regarding Uncertificated Securities, Limited Liability
Company Interests and Partnership Interests
 
AGREEMENT (as amended, modified or supplemented from time to time, this
“Agreement”), dated as of _______ __, ____, among the undersigned pledgor (the
“Pledgor”), DNB NOR BANK ASA, New York Branch, not in its individual capacity
but solely as collateral agent (the “Pledgee”), and __________, as the issuer of
the Uncertificated Securities, Limited Liability Company Interests and/or
Partnership Interests (each as defined below) (the “Issuer”).
 
 
W I T N E S S E T H :
 
WHEREAS, the Pledgor, certain of its affiliates and the Pledgee have entered
into a Pledge and Security Agreement, dated as of July 20, 2007 (as amended,
amended and restated, modified or supplemented from time to time, the “Pledge
Agreement”), under which, among other things, in order to secure the payment of
the Obligations (as defined in the Pledge Agreement), the Pledgor will pledge to
the Pledgee for the benefit of the Secured Creditors (as defined in the Pledge
Agreement), and grant a first priority security interest in favor of the Pledgee
for the benefit of the Secured Creditors in, all of the right, title and
interest of the Pledgor in and to any and all (1) “uncertificated securities”
(as defined in Section 8-102(a)(18) of the Uniform Commercial Code, as adopted
in the State of New York) (“Uncertificated Securities”), (2)  Partnership
Interests (as defined in the Pledge Agreement) and (3) Limited Liability Company
Interests (as defined in the Pledge Agreement), in each case issued from time to
time by the Issuer, whether now existing or hereafter from time to time acquired
by the Pledgor (with all of such Uncertificated Securities, Partnership
Interests and Limited Liability Company Interests being herein collectively
called the “Issuer Pledged Interests”); and
 
WHEREAS, the Pledgor desires the Issuer to enter into this Agreement in order to
protect the security interest of the Pledgee under the Pledge Agreement in the
Issuer Pledged Interests, to vest in the Pledgee control of the Issuer Pledge
Interests and to provide for the rights of the parties under this Agreement;
 
NOW THEREFORE, in consideration of the premises and the mutual promises and
agreements contained herein, and for other valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the parties hereto hereby
agree as follows:
 
1.  The Pledgor hereby irrevocably authorizes and directs the Issuer, and the
Issuer hereby agrees, to comply with any and all instructions and orders
originated by the Pledgee (and its successors and assigns) regarding any and all
of the Issuer Pledged Interests without the further consent by the registered
owner (including the Pledgor), and, after receiving a notice from the Pledgee
stating that an “Event of Default” has occurred and is continuing, not to comply
with any instructions or orders regarding any or all of the Issuer Pledged
Interests
 
 
 

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ANNEX G
Page 2
 
originated by any person or entity other than the Pledgee (and its successors
and assigns) or a court of competent jurisdiction.
 
2.  The Issuer hereby certifies that (i) no notice of any security interest,
lien or other encumbrance or claim affecting the Issuer Pledged Interests (other
than the security interest of the Pledgee) has been received by it, and (ii) the
security interest of the Pledgee in the Issuer Pledged Interests has been
registered in the books and records of the Issuer.
 
3.  The Issuer hereby represents and warrants that (i) the pledge by the Pledgor
of, and the granting by the Pledgor of a security interest in, the Issuer
Pledged Interests to the Pledgee, for the benefit of the Secured Creditors, does
not violate the charter, by-laws, partner­ship agreement, membership agreement
or any other agreement governing the Issuer or the Issuer Pledged Interests, and
(ii) the Issuer Pledged Interests are fully paid and nonassessable.
 
4.  All notices, statements of accounts, reports, prospectuses, financial
statements and other communications to be sent to the Pledgor by the Issuer in
respect of the Issuer will also be sent to the Pledgee at the following address:
 
DnB Nor Bank ASA,
     New York Branch
200 Park Avenue, 31st Floor
New York, New York 10166-0396
Attn:  Nikolai Nachamkin
Telephone:  212-681-3863
Facsimile:   212-681-3900
 
5.  Until the Pledgee shall have delivered written notice to the Issuer that all
of the Obligations have been paid in full and this Agreement is terminated, the
Issuer will, upon receiving notice from the Pledgee stating that an “Event of
Default” has occurred and is continuing, send any and all redemptions,
distributions, interest or other payments in respect of the Issuer Pledged
Interests from the Issuer for the account of the Pledgor only by wire transfers
to such account as the Pledgee shall instruct.
 
6.  Except as expressly provided otherwise in Sections 4 and 5, all notices,
shall be sent or delivered by mail, telegraph, telex, telecopy, cable or
overnight courier service and all such notices and communications shall, when
mailed, telegraphed, telexed, telecopied, or cabled or sent by overnight
courier, be effective when deposited in the mails, delivered to the telegraph
company, cable company or courier, as the case may be, or sent by telex or
telecopier, except that notices and communications to the Pledgee, the Pledgor
or the Issuer shall not be effective until received by the Pledgee, the Pledgor
or the Issuer, as the case may be.  All notices and other communications shall
be in writ­ing and addressed as follows:
 
(a)           if to any Pledgor, at:
 
c/o Genco Ship Management LLC,
35 West 56th Street
 
 
 
 

--------------------------------------------------------------------------------

 
 
ANNEX G
Page 3
 
 
New York, NY 10019
Attention:  John Wobensmith
Telephone No.:  646-443-8555
Telecopier No.:  646-552-4052

with copies to:
Seward & Kissel LLP
One Battery Park Plaza
New York, New York 10004
Attention: Lawrence Rutkowski
Telephone No.: 212-574-1200
Telecopier No.: 212-480-8421
 
(b)           if to the Pledgee, at:
 
DnB Nor Bank ASA,
     New York Branch
200 Park Avenue, 31st Floor
New York, New York 10166-0396
Attn:  Nikolai Nachamkin
 
Telephone:  212-681-3863
Facsimile:   212-681-3900
 
(c)           if to the Issuer, at:
 
________________________
________________________
________________________
 
or at such other address as shall have been furnished in writing by any Person
described above to the party required to give notice hereunder.
 
7.  This Agreement shall be binding upon the successors and assigns of the
Pledgor and the Issuer and shall inure to the benefit of and be enforceable by
the Pledgee and its successors and assigns.  This Agreement may be executed in
any number of counterparts, each of which shall be an original, but all of which
shall constitute one instrument.  In the event that any provision of this
Agreement shall prove to be invalid or unenforceable, such provision shall be
deemed to be severable from the other provisions of this Agreement which shall
remain binding on all parties hereto.  None of the terms and conditions of this
Agreement may be changed, waived, modified or varied in the manner whatsoever
except in writing signed by the Pledgee, the Issuer and the Pledgor.
 
8.  This Agreement shall be governed by and construed in accordance with the
laws of the State of New York, without regard to its principles of conflict of
laws (other than Title 14 of Articles 5 of the New York General Obligations Law.
 
 
 

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ANNEX G
Page 4
 
 
 
IN WITNESS WHEREOF, the Pledgor, the Pledgee and the Issuer have caused this
Agreement to be executed by their duly elected officers duly authorized as of
the date first above written.
 
[______________________],
as Pledgor
 
By_____________________________
Name:
Title:
 
 
DNB NOR BANK ASA, NEW YORK BRANCH,

 
not in its individual capacity but solely as Pledgee

By_____________________________
Name:
Title:
 
By_____________________________
Name:
Title:
 

[________________________],
the Issuer
 
By_____________________________
Name:
Title:
 
 
 
 
 

--------------------------------------------------------------------------------

 
 
 
ANNEX H
to
Pledge and Security Agreement

 
Form of Control Agreement Regarding Deposit Accounts

CONTROL AGREEMENT REGARDING DEPOSIT ACCOUNTS (as amended, modified or
supplemented from time to time, this “Agreement”), dated as of _______ __, ____,
among the undersigned assignor (the “Assignor”), DNB NOR BANK ASA, New York
Branch, not in its individual capacity but solely as Collateral Agent (the
“Collateral Agent”) and NORDEA BANK FINLAND, PLC, New York Branch, as the
deposit account bank (the “Deposit Account Bank”), as the bank (as defined in
Section 9-102 of the UCC as in effect on the date hereof in the State of
_______________ (the “UCC”)) with which one or more deposit accounts (as defined
in Section 9-102 of the UCC) are maintained by the Assignor (with all such
deposit accounts now or at any time in the future maintained by the Assignor
with the Deposit Account Bank being herein called the “Deposit Accounts”).
 
 
W I T N E S S E T H :
 
WHEREAS, the Assignor, various other Assignors and the Collateral Agent have
entered into a Pledge and Security Agreement, dated as of July 20, 2007 (as
amended, amended and restated, modified or supplemented from time to time, the
“Pledge and Security Agreement”), under which, among other things, in order to
secure the payment of the Obligations (as defined in the Pledge and Security
Agreement), the Assignor has granted a first priority security interest to the
Collateral Agent for the benefit of the Secured Creditors (as defined in the
Pledge and Security Agreement) in all of the right, title and interest of the
Assignor in and into any and all deposit accounts (as defined in Section 9-102
of the UCC) and in all monies, securities, instruments and other investments
deposited therein from time to time (collectively, herein called the
“Collateral”); and
 
WHEREAS, the Assignor desires that the Deposit Account Bank enter into this
Agreement in order to establish “control” (as defined in Section 9-104 of the
UCC) in each Deposit Account at any time or from time to time maintained with
the Deposit Account Bank, and to provide for the rights of the parties under
this Agreement with respect to such Deposit Accounts;
 
NOW THEREFORE, in consideration of the premises and the mutual promises and
agreements contained herein, and for other valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the parties hereto hereby
agree as follows:
 
1.           Assignor’s Dealings with Deposit Accounts; Notice of Exclusive
Control. Until the Deposit Account Bank shall have received from the Collateral
Agent a Notice of Exclusive Control (as defined below), the Assignor shall be
entitled to present items drawn on and otherwise to withdraw or direct the
disposition of funds from the Deposit Accounts and give instructions in respect
of the Deposit Accounts; provided, however, that the Assignor may not,
 
 
 

--------------------------------------------------------------------------------

 
ANNEX H
Page 2
 
 
 
and the Deposit Account Bank agrees that it shall not permit the Assignor to,
without the Collateral Agent’s prior written consent, close any Deposit
Account.  If upon the occurrence and during the continuance of an Event of
Default (as defined in the Pledge and Security Agreement) the Collateral Agent
shall give to the Deposit Account Bank a notice of the Collateral Agent’s
exclusive control of the Deposit Accounts, which notice states that it is a
“Notice of Exclusive Control” (a “Notice of Exclusive Control”), only the
Collateral Agent shall be entitled to withdraw funds from the Deposit Accounts,
to give any instructions in respect of the Deposit Accounts and any funds held
therein or credited thereto or otherwise to deal with the Deposit Accounts.
 
2.           Collateral Agent’s Right to Give Instructions as to Deposit
Accounts.  (a)  Notwithstanding the foregoing or any separate agreement that the
Assignor may have with the Deposit Account Bank, the Collateral Agent shall be
entitled, following the occurrence and during the continuance of an Event of
Default for purposes of this Agreement, at any time to give the Deposit Account
Bank instructions as to the withdrawal or disposition of any funds from time to
time credited to any Deposit Account, or as to any other matters relating to any
Deposit Account or any other Collateral, without further consent from the
Assignor.  The Assignor hereby irrevocably authorizes and instructs the Deposit
Account Bank, and the Deposit Account Bank hereby agrees, to comply with any
such instructions from the Collateral Agent without any further consent from the
Assignor.  Such instructions may include the giving of stop payment orders for
any items being presented to any Deposit Account for payment.  The Deposit
Account Bank shall be fully entitled to rely on, and shall comply with,  such
instructions from the Collateral Agent even if such instructions are contrary to
any instructions or demands that the Assignor may give to the Deposit Account
Bank.  In case of any conflict between instructions received by the Deposit
Account Bank from the Collateral Agent and the Assignor, the instructions from
the Collateral Agent shall prevail.
 
(b)           It is understood and agreed that the Deposit Account Bank’s duty
to comply with instructions from the Collateral Agent regarding the Deposit
Accounts is absolute, and the Deposit Account Bank shall be under no duty or
obligation, nor shall it have the authority, to inquire or determine whether or
not such instructions are in accordance with the Pledge and Security Agreement
or any other Credit Document (as defined in the Pledge and Security Agreement),
nor seek confirmation thereof from the Assignor or any other Person.
 
3.           Assignor’s Exculpation and Indemnification of Depository Bank.  The
Assignor hereby irrevocably authorizes and instructs the Deposit Account Bank to
follow instructions from the Collateral Agent regarding the Deposit Accounts
even if the result of following such instructions from the Collateral Agent is
that the Deposit Account Bank dishonors items presented for payment from any
Deposit Account.  The Assignor further confirms that the Deposit Account Bank
shall have no liability to the Assignor for wrongful dishonor of such items in
following such instructions from the Collateral Agent.  The Deposit Account Bank
shall have no duty to inquire or determine whether the Assignor’s obligations to
the Collateral Agent are in default or whether the Collateral Agent is entitled,
under any separate agreement between the Assignor and the Collateral Agent, to
give any such instructions.  The Assignor further agrees to be responsible for
the Deposit Account Bank’s customary charges and
 
 
 

--------------------------------------------------------------------------------

 
ANNEX H
Page 3
 
 
to indemnify the Deposit Account Bank from and to hold the Deposit Account Bank
harmless against any loss, cost or expense that the Deposit Account Bank may
sustain or incur in acting upon instructions which the Deposit Account Bank
believes in good faith to be instructions from the Collateral Agent excluding
any loss, cost or expense to the extent incurred as a direct result of the gross
negligence or willful misconduct of the Deposit Account Bank.
 
4.           Subordination of Security Interests; Deposit Account Bank’s
Recourse to Deposit Accounts.  The Deposit Account Bank hereby subordinates any
claims and security interests it may have against, or with respect to, any
Deposit Account at any time established or maintained with it by the Assignor
(including any amounts, investments, instruments or other Collateral from time
to time on deposit therein) to the security interests of the Collateral Agent
(for the benefit of the Secured Creditors) therein, and agrees that no amounts
shall be charged by it to, or withheld or set-off or otherwise recouped by it
from, any Deposit Account of the Assignor or any amounts, investments,
instruments or other Collateral from time to time on deposit therein; provided
that the Deposit Account Bank may, however, from time to time debit the Deposit
Accounts for any of its customary charges in maintaining the Deposit Accounts or
for reimbursement for the reversal of any provisional credits granted by the
Deposit Account Bank to any Deposit Account, to the extent, in each case, that
the Assignor has not separately paid or reimbursed the Deposit Account Bank
therefor.
 
5.           Representations, Warranties and Covenants of Deposit Account
Bank.  The Deposit Account Bank represents and warrants to the Collateral Agent
that:
 
(a)           The Deposit Account Bank constitutes a “bank” (as defined in
Section 9-102 of the UCC), that the jurisdiction (determined in accordance with
Section 9-304 of the UCC) of the Deposit Account Bank for purposes of each
Deposit Account maintained by the Assignor with the Deposit Account Bank shall
be one or more States within the United States.
 
(b)           The Deposit Account Bank shall not permit any Assignor to
establish any demand, time, savings, passbook or other account with it which
does not constitute a “deposit account” (as defined in Section 9-102 of the
UCC).
 
(c)  The account agreements between the Deposit Account Bank and the Assignor
relating to the establishment and general operation of the Deposit Accounts
provide, whether specifically or generally, that the laws of New York govern
secured transactions relating to the Deposit Accounts and that the Deposit
Account Bank’s “jurisdiction” for purposes of Section 9-304 of the UCC in
respect of the Deposit Accounts is New York.  The Deposit Account Bank will not,
without the Collateral Agent’s prior written consent, amend any such account
agreement so that the Deposit Account Bank’s jurisdiction for purposes of
Section 9-304 of the UCC is other than a jurisdiction permitted pursuant to
preceding clause (a).  All account agreements in respect of each Deposit Account
in existence on the date hereof are listed on Annex A hereto and copies of all
such account agreements have been furnished to the Collateral Agent.  The
Deposit Account Bank will promptly furnish to the Collateral Agent a copy of the
account agreement for each Deposit Account hereafter established by the Deposit
Account Bank for the Assignor.
 
 
 

--------------------------------------------------------------------------------

 
 
ANNEX H
Page 4
 
 
(d)           The Deposit Account Bank has not entered and will not enter, into
any agree­ment with any other Person by which the Deposit Account Bank is
obligated to comply with instructions from such other Person as to the
disposition of funds from any Deposit Account or other dealings with any Deposit
Account or other of the Collateral.
 
(e)           On the date hereof the Deposit Account Bank maintains no Deposit
Accounts for the Assignor other than the Deposit Accounts specifically
identified in Annex A hereto.
 
(f)           Any items or funds received by the Deposit Account Bank for the
Assignor’s account will be credited to said Deposit Accounts specified in
paragraph (e) above or to any other Deposit Accounts hereafter established by
the Deposit Account Bank for the Assignor in accordance with this Agreement.
 
(g)           The Deposit Account Bank will promptly notify the Collateral Agent
of each Deposit Account hereafter established by the Deposit Account Bank for
the Assignor (which notice shall specify the account number of such Deposit
Account and the location at which the Deposit Account is maintained), and each
such new Deposit Account shall be subject to the terms of this Agreement in all
respects.
 
6.           Deposit Account Statements and Information.  The Deposit Account
Bank agrees, and is hereby authorized and instructed by the Assignor, to furnish
to the Collateral Agent, at its address indicated below, copies of all account
statements and other information relating to each Deposit Account that the
Deposit Account Bank sends to the Assignor and to disclose to the Collateral
Agent all information requested by the Collateral Agent regarding any Deposit
Account.
 
7.           Conflicting Agreements.  This Agreement shall have control over any
conflicting agreement between the Deposit Account Bank and the Assignor.
 
8.           Merger or Consolidation of Deposit Account Bank.  Without the
execution or filing of any paper or any further act on the part of any of the
parties hereto, any bank into which the Deposit Account Bank may be merged or
with which it may be consolidated, or any bank resulting from any merger to
which the Deposit Account Bank shall be a party, shall be the successor of the
Deposit Account Bank hereunder and shall be bound by all provisions hereof which
are binding upon the Deposit Account Bank and shall be deemed to affirm as to
itself all representations and warranties of the Deposit Account Bank contained
herein.
 
9.           Notices.  (a)  All notices and other communications provided for in
this Agreement shall be in writing (including facsimile) and sent to the
intended recipient at its address or telex or facsimile number set forth below:
 
 
 

--------------------------------------------------------------------------------

 
 
ANNEX H
Page 5
 
 
 
If to the Collateral Agent, at:
 
DnB Nor Bank ASA,
     New York Branch
200 Park Avenue, 31st Floor
New York, New York 10166-0396
Attn:  Nikolai Nechamkin
Telephone:  212-681-3863
Facsimile:   212-681-3900

 
 
If to the Assignor, at:
 
____________
____________
____________

 
If to the Deposit Account Bank, at:
 
Nordea Bank Finland, Plc,
     New York Branch
437 Madison Avenue
21st Floor
New York, New York 10022
Attention:  Hans Chr. Kjelsrud
Telephone:  (212) 318 9634
Facsimile:   (212) 421 4420

 
 
or, as to any party, to such other address or telex or facsimile number as such
party may designate from time to time by notice to the other parties.
 
(b)           Except as otherwise provided herein, all notices and other
communications hereunder shall be delivered by hand or by commercial overnight
courier (delivery charges prepaid), or mailed, postage prepaid, or telexed or
faxed, addressed as aforesaid, and shall be effective (i) three business days
after being deposited in the mail (if mailed), (ii) when delivered (if delivered
by hand or courier) and (iii) or when transmitted with receipt confirmed (if
telexed or faxed); provided that notices to the Collateral Agent shall not be
effective until actually received by it.
 
10.           Amendment.  This Agreement may not be amended, modified or
supplemented except in writing executed and delivered by all the parties hereto.
 
 
 

--------------------------------------------------------------------------------

 
 
ANNEX H
Page 6
 
 
11.           Binding Agreement.  This Agreement shall bind the parties hereto
and their successors and assign and shall inure to the benefit of the parties
hereto and their successors and assigns.  Without limiting the provisions of the
immediately preceding sentence, the Collateral Agent at any time or from time to
time may designate in writing to the Deposit Account Bank a successor Collateral
Agent (at such time, if any, as such entity becomes the Collateral Agent under
the Pledge and Security Agreement, or at any time thereafter) who shall
thereafter succeed to the rights of the existing Collateral Agent hereunder and
shall be entitled to all of the rights and benefits provided hereunder.
 
12.           Continuing Obligations.  The rights and powers granted herein to
the Collateral Agent have been granted in order to protect and further perfect
its security interests in the Deposit Accounts and other Collateral and are
powers coupled with an interest and will be affected neither by any purported
revocation by the Assignor of this Agreement or the rights granted to the
Collateral Agent hereunder or by the bankruptcy, insolvency, conservatorship or
receivership of the Assignor or the Deposit Account Bank or by the lapse of
time.  The rights of the Collateral Agent hereunder and in respect of the
Deposit Accounts and the other Collateral, and the obligations of the Assignor
and Deposit Account Bank hereunder, shall continue in effect until the security
interests of Collateral Agent in the Deposit Accounts and such other Collateral
have been terminated and the Collateral Agent has notified the Deposit Account
Bank of such termination in writing.
 
13.           Governing Law.   This Agreement shall be governed by and construed
in accordance with the laws of the State of New York.
 
14.           Counterparts.      This Agreement may be executed in any number of
counterparts, all of which shall constitute one and the same instrument, and any
party hereto may execute this Agreement by signing and delivering one or more
counterparts.
 
15.           Termination.        This Agreement and the security interest
created hereby shall terminate on the date on which the Collateral Agent shall
have given the Deposit Account Bank written notice that this Agreement shall
have terminated.
 
 
 

--------------------------------------------------------------------------------

 
 
ANNEX H
Page 7
 
 
IN WITNESS WHEREOF, the parties hereto have duly executed and delivered this
Agreement as of the date first written above.
 
 
Assignor:

 
 
[NAME OF ASSIGNOR]

 
 
By:______________________

 
Name:

 
Title:

 
 
Collateral Agent:

 
 
DNB NOR BANK ASA, NEW YORK BRANCH,

 
 
as Collateral Agent

 
 
By:______________________

 
Name:

 
Title:

 
 
By:______________________

 
Name:

 
Title:

 
 
 
Deposit Account Bank:

 
 
NORDEA BANK FINLAND PLC, NEW YORK BRANCH, as Deposit Account Bank

 
 
 
By:______________________

 
Name:

 
Title:

 
 
 
By:______________________

 
Name:

 
Title:

 
 
 

--------------------------------------------------------------------------------

 
 
 
 
Annex I

 
Operating Accounts
 
                Assignor
Account Number
   

 

--------------------------------------------------------------------------------

      
        Exhibit G      
      
        
      
    

 
SOLVENCY CERTIFICATE
 
I, the undersigned, the Chief Financial Officer of Genco Shipping & Trading
Limited (the “Company”), do hereby certify in such capacity and on behalf of the
Company that:
 
1.  This Certificate is furnished to the Administrative Agent and each of the
Lenders pursuant to Section 5.08 of the Credit Agreement, dated as of July __,
2007, among Genco Shipping & Trading Limited, the Lenders party hereto from time
to time, DnB Nor Bank ASA, New York Branch, as Administrative Agent and as
Collateral Agent under the Security Documents (such Credit Agreement, as in
effect on the date of this Certificate, being herein called the “Credit
Agreement”).  Unless otherwise defined herein, capitalized terms used in this
Certificate shall have the meanings set forth in the Credit Agreement.
 
2.  For purposes of this Certificate, the terms below shall have the following
definitions:
 
 
(a)
“Fair Value”

 
The amount at which the assets, in their entirety, of each of the Company on a
stand-alone basis, and the Company and its Subsidiaries taken as a whole, would
change hands between a willing buyer and a willing seller, within a commercially
reasonable period of time, each having reasonable knowledge of the relevant
facts, with neither being under any compulsion to act.
 
 
(b)
“Present Fair Salable Value”

 
The amount that could be obtained by an independent willing seller from an
independent willing buyer if the assets of each of the Company on a stand-alone
basis, and the Company and its Subsidiaries taken as a whole, are sold with
reasonable promptness under normal selling conditions in a current market.
 
 
(c)
“New Financing”

 
The Indebtedness incurred or to be incurred by the Company and its Subsidiaries
under the Documents and all other financing contemplated by the Documents
(including, without limitation, the Credit Documents).
 
 
(d)
“Stated Liabilities”

 
The recorded liabilities that would be recorded in accordance with generally
accepted accounting principles (“GAAP”) of the Company on a stand-alone basis
and of the Company and its Subsidiaries taken as a whole as of the date hereof
after giving effect to all of the Vessel Acquisitions, determined in accordance
with GAAP consistently applied, together with the amount of all New Financing.
 
 

--------------------------------------------------------------------------------

 
Exhibit G
 Page 2
 
 
 
(e)
“Identified Contingent Liabilities”

 
The maximum estimated amount of liabilities reasonably likely to result from
pending litigation, asserted claims and assessments, guaranties, uninsured risks
and other contingent liabilities of each of the Company on a stand-alone basis,
and the Company and its Subsidiaries taken as a whole, after giving effect to
all the Vessel Acquisitions, as identified and explained in terms of their
nature and estimated magnitude by responsible officers of the Company and its
Subsidiaries or that have been identified as such by an officer of the Company
or any of its Subsidiaries.
 
 
(f)
“Will be able to pay its Stated Liabilities and Identified Contingent
Liabilities, as they mature”

 
For the period from the date hereof through the stated maturity of all the New
Financing, each of the Company on a stand-alone basis, and the Company and its
Subsidiaries taken as a whole, will have sufficient assets and cash flow to pay
its Stated Liabilities and Identified Contingent Liabilities as those
liabilities mature or otherwise become payable.
 
 
(g)
“Does not have Unreasonably Small Capital”

 
For the period from the date hereof through the stated maturity of all the New
Financing, each of the Company on a stand-alone basis, and the Company and its
Subsidiaries taken as a whole, after consummation of all of the Vessel
Acquisitions and all Indebtedness being incurred or assumed and Liens created by
the Company and its Subsidiaries in connection therewith, is a going concern and
has sufficient capital to ensure that it will continue to be a going concern for
such period and to remain a going concern.
 
3.  For purposes of this Certificate, I, or other officers of the Company and
its Subsidiaries under my direction and supervision, have performed the
following procedures as of and for the periods set forth below.
 
 
(a)
I have reviewed the balance sheets referred to in Section 9.05 of the Credit
Agreement.

 
 
(b)
I have made inquiries of certain officials of the Company and its Subsidiaries
who have responsibility for financial and accounting matters regarding the
existence and amount of Identified Contingent Liabilities associated with the
business of the Company and its Subsidiaries.

 
 
(c)
I have knowledge of and have reviewed to my satisfaction the Credit Documents
and the other Documents, and the respective Schedules and Exhibits thereto.

 
 

--------------------------------------------------------------------------------

 
Exhibit G
 Page 3
 
 
(d)
With respect to Identified Contingent Liabilities, I:

 
(i)           inquired of certain officials of the Company and its Subsidiaries
who have responsibility for legal, financial and accounting matters as to the
existence and estimated liability with respect to all contingent liabilities
known to them; and
 
(ii)           confirmed with officers of the Company and its Subsidiaries that,
to the best of such officers’ knowledge, all appropriate items were included in
Identified Contingent Liabilities and the amounts relating thereto were the
maximum estimated amount of liabilities reasonably likely to result therefrom as
of the date hereof.
 
 
(e)
I have made inquiries of certain officers of the Company and its Subsidiaries
who have responsibility for financial reporting and accounting matters regarding
whether they were aware of any events or conditions that, as of the date hereof,
would cause either the Company on a stand-alone basis, or the Company and its
Subsidiaries taken as a whole, in either case after giving effect to all of the
Vessel Acquisitions and the related financing transactions (including the
incurrence of the New Financing), to (i) have assets with a Fair Value or
Present Fair Salable Value that are less than the sum of Stated Liabilities and
Identified Contingent Liabilities; (ii) have Unreasonably Small Capital; or
(iii) not be able to pay its Stated Liabilities and Identified Contingent
Liabilities as they mature or otherwise become payable.

 
4.  Based on and subject to the foregoing, I, in my capacity as the chief
financial officer of the Company, hereby certify on behalf of the Company that,
after giving effect to all of the Vessel Acquisitions and the related financing
transactions (including the incurrence of the New Financing), it is my informed
opinion that (i) the Fair Value of the assets of each of the Company on a
stand-alone basis, and the Company and its Subsidiaries taken as a whole, is
greater than its Stated Liabilities and Identified Contingent Liabilities; (ii)
the Present Fair Salable Value of the assets of each of the Company on a
stand-alone basis, and the Company and its Subsidiaries taken as a whole, is
greater than its Stated Liabilities and Identified Contingent Liabilities; (iii)
each of the Company on a stand-alone basis, and the Company and its Subsidiaries
taken as a whole, will be able to pay its Stated Liabilities and Identified
Contingent Liabil­ities, as they mature or otherwise become payable; and (iv)
neither the Company on a stand-alone basis, nor the Company and its Subsidiaries
taken as a whole, has Unreasonably Small Capital.
 
 

--------------------------------------------------------------------------------

 
 
Exhibit G
 Page 4
 

IN WITNESS WHEREOF, I have hereto on behalf of the Company set my hand this __
day of July, 2007.
 
 
GENCO SHIPPING & TRADING LIMITED

 
 
                                    By:___________________
                        Name:
                        Title
 
 

--------------------------------------------------------------------------------

      
                  EXHIBIT H-1              
    

ASSIGNMENT OF EARNINGS

[VESSEL]
Official Number [OFFICIAL NUMBER]

THIS EARNINGS ASSIGNMENT, dated [CLOSING DATE], is given by [SHIPOWNER], a
Marshall Islands corporation and registered under Part XI of the Hong Kong
Companies Ordinance having its principal place of business at 15th Floor, Tower
One, Lippo Centre, 89 Queensway, Hong Kong (the “Assignor”), in favor of DNB NOR
BANK ASA, NEW YORK BRANCH, a bank incorporated under the laws of the Kingdom of
Norway, acting through its New York branch, with offices at 200 Park Avenue, New
York, New York 10166-0396, as Collateral Agent under the Credit Agreement
referred to below (the “Assignee”).  Except as otherwise defined herein,
capitalized terms used herein and defined in the Credit Agreement (as defined
below) shall be used herein as so defined.

RECITALS

A.           The Assignor is the sole owner of the Hong Kong flag vessel
[VESSEL], Official Number [OFFICIAL NUMBER] (the “Vessel”).

B.           Genco Shipping & Trading Limited, a Marshall Islands corporation
(the “Borrower”) has entered into a Credit Agreement dated as of July __, 2007
(as the same may be amended, supplemented or otherwise modified from time to
time, the “Credit Agreement”) among (i) various Lenders referred to therein,
(ii) the Assignee, as Administrative Agent, mandated lead arranger, bookrunner
and Collateral Agent, providing for the making of revolving loans to the
Borrower in the principal amount of up to One Billion Three Hundred Seventy
Seven Million United States Dollars (U.S. $1,377,000,000) (the Lenders, the
Administrative Agent and Collateral Agent, collectively, the “Lender
Creditors”).

C.           The Assignor is a wholly-owned subsidiary of the Borrower.

D.           The Borrower may at any time and from time to time enter into, or
guaranty the obligations of one or more Subsidiary Guarantors or any of their
respective Subsidiaries under, one or more Interest Rate Protection Agreements
or Other Hedging Agreements with respect to the Loan (and/or the Commitments)
with one or more Lenders or any Affiliate thereof (each such Lender or
Affiliate, even if the respective Lender subsequently ceases to be a Lender
under the Credit Agreement for any reason, together with such Lender’s or
Affiliate’s successors and assigns, if any, collectively, the “Other Creditors”
and, together with the Lender Creditors, the “Secured Creditors”).

E.           The Assignor has entered into the Guaranty in favor of the Secured
Creditors pursuant to which the Assignor has guaranteed (i) to the Lender
Creditors, all obligations of the Borrower under the Credit Agreement and each
other Credit Document to which the Borrower is a party, and (ii) to each of the
Other Creditors, all obligations of the Borrower under each Interest Rate
Protection Agreement and each Other Hedging Agreement entered into with respect
to the Loan (and/or the Commitments), and the Assignor has granted the Assignee
a first priority Hong Kong Mortgage together with a deed of covenants collateral
thereto (together, the “Mortgage”) on the Vessel to secure, among other things,
its obligations under the Guaranty.

F.           It is a condition to the obligation of the Lenders to advancing the
Loan in respect of the Capesize Vessels to the Borrower under the Credit
Agreement that the Assignor enters into this
 
 
 

--------------------------------------------------------------------------------

 
 
 
 Assignment as security for its obligations under the Guaranty.

NOW, THEREFORE, the parties hereto agree as follows:

 
Section 1.            As security for all amounts due and to become due to the
Secured Creditors under the Guaranty, the Assignor as beneficial owner hereby
grants, sells, conveys, assigns, transfers, mortgages and pledges to the
Assignee, and unto the Assignee’s successors and assigns, all its right, title,
interest, claim and demand in and to, and hereby also grants unto the Assignee a
security interest in and to (the following clauses (i) through (vi),
collectively, the “Earnings Collateral”) (i) the earnings of the Vessel,
including, but not limited to, all freight, hire and passage moneys, proceeds of
off-hire insurance, any other moneys earned and to be earned, due or to become
due, or paid or payable to, or for the account of, the Assignor, of whatsoever
nature, arising out of or as a result of the ownership, use, operation or
management by the Assignor or its agents of the Vessel, (ii) all moneys and
claims for moneys due and to become due to the Assignor under and all claims for
damages arising out of the breach (or payments for variation or termination) of
any charter, or contract relating to or under which is employed the Vessel, any
and all other present and future charter parties, contracts of affreightment,
and operations of every kind whatsoever of the Vessel, and in and to any and all
claims and causes of action for money, loss or damages that may now and
hereafter accrue or belong to the Assignor, its successors or assigns, arising
out of or in any way connected with the present or future ownership, use,
operation or management of the Vessel or arising out of or in any way connected
with the Vessel, (iii) if the Vessel is employed on terms whereby any money
falling within clauses (i) or (ii) above are pooled or shared with any other
Person, that proportion of the net receipts of the pooling or sharing
arrangements which is attributable to the Vessel, (iv) all moneys and claims for
moneys due and to become due to the Assignor, and all claims for damages, in
respect of the actual or constructive total loss of or requisition of use of or
title to the Vessel, (v) all moneys and claims for moneys due in respect of
demurrage or detention, and (vi) any proceeds of any of the foregoing.

Section 2.             The Assignor covenants that (i) it will have all the
earnings and other moneys hereby assigned paid over promptly to such Operating
Account as the Collateral Agent may specify in writing from time to time; (ii)
it will promptly notify in writing substantially in the form of Exhibit A
hereto, and deliver a duplicate copy of such notice to the Assignee, each of the
Assignor’s agents and representatives into whose hands or control may come any
earnings and moneys hereby assigned, informing each such Person of this
Assignment and instructing such addressee to remit promptly to such Operating
Account all earnings and moneys hereby assigned which may come into such
Person’s hands or control and to continue to make such remittances until such
time as such Person may receive written notice or instructions to the contrary
directly from the Assignee; and (iii) it will instruct each such Person to
acknowledge directly to the Assignee receipt of the Assignor’s written
notification and the instructions.
 
Section 3.             Anything herein contained to the contrary
notwithstanding, the Assignee, or its respective successors and assigns, shall
have no obligation or liability under any agreement, including any charter or
contract of affreightment by reason of or arising out of this Assignment, or out
of any Charter Assignment (as defined below) made pursuant to Section 6 hereof,
and the Assignee, its respective successors and assigns, shall not be required
or obligated in any manner to perform or fulfill any obligations of the Assignor
under or pursuant to any agreement, including any charter or contract of
affreightment, or to make any payment or to make any inquiry as to the nature or
sufficiency of any payment received by the Assignee or to present or file any
claim, or to take any other action to collect or enforce the payment of any
amounts which may have been assigned to it or to which it may be entitled
hereunder at any time or times.
 
 
 
2

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Section 4.             The Assignor hereby constitutes the Assignee, its
successors and assigns, its true and lawful attorney-in-fact, irrevocably, with
full power, in the name of the Assignor or otherwise, upon the occurrence and
continuance of a Default or an Event of Default, to ask, require, demand,
receive, compound and give acquittance for any and all moneys and claims for
moneys due and to become due, property and rights hereby assigned, to endorse
any checks or other instruments or orders in connection therewith and to file
any document or to take any action or institute any proceedings which the
Assignee and its successors and assigns may reasonably deem necessary or
advisable in the premises.

Section 5.             The powers and authorities granted to the Assignee and
its successors or assigns herein have been given for valuable consideration and
are hereby declared to be irrevocable.

Section 6.            The Assignor hereby agrees that at any time and from time
to time, upon entering into any charter or contract of affreightment or other
agreement for employment of the Vessel of whatsoever nature for a period of
twelve (12) months or longer including permitted extensions and renewals, it
will promptly and duly execute and deliver to and in favor of the Assignee at
the cost and expense of the Assignor a Charter Assignment in respect of such
charter to the Assignee substantially in the form attached as Exhibit B hereto
(the “Charter Assignment”) and it will promptly execute and deliver any and all
such further instruments and documents as the Assignee, and its successors or
assigns, may reasonably require in order to obtain the full benefits of this
Assignment, the Charter Assignment and of the rights and powers herein and
therein granted.  The Assignor covenants to use its commercially reasonable
efforts to obtain the consent of the charterer under said charter to the Charter
Assignment pursuant to the terms of the Charter Assignment or in other form and
substance reasonably satisfactory to the Assignee.
 
Section 7.             The Assignor warrants and represents that it has not
assigned or pledged the rights, title and interest assigned hereunder to anyone
other than the Assignee.  The Assignor hereby covenants that, without the prior
written consent thereto of the Assignee, so long as this Assignment shall remain
in effect, it will not assign or pledge the whole or any part of the rights,
title and interest hereby assigned to anyone other than the Assignee, and it
will not take or omit to take any action, the taking or omission of which might
result in an alteration or impairment of this Assignment, or of any of the
rights created by this Assignment.

Section 8.             The Assignor agrees that at any time and from time to
time, upon the written request of the Assignee, the Assignor will promptly and
duly execute and deliver any and all further instruments and documents as the
Assignee may deem desirable in obtaining the full benefits of this Assignment.

Section 9.             THIS ASSIGNMENT AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES HEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND BE GOVERNED BY THE
LAW OF THE STATE OF NEW YORK WITHOUT REGARD TO ITS CONFLICT OF LAWS RULES (OTHER
THAN TITLE 14 OF ARTICLE 5 OF THE GENERAL OBLIGATIONS LAW).  This Assignment
shall not be amended and/or varied except by agreement in writing signed by the
parties hereto.

Section 10.           Any notice, demand or other communication to be given
under or for the purposes of this Assignment shall be made as provided in
Section 15.03 of the Credit Agreement or Section 4 of Article IV of the
Mortgage.
 
 
 
3

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Section 11.           This Assignment may be executed in any number of
counterparts each of which shall be an original, but all such counterparts shall
together constitute one and the same instrument.

IN WITNESS WHEREOF, the Assignor has duly executed this instrument on the day
and year first above written.

[SHIPOWNER],
as Assignor

By:  __________________
Name: [                         ]
Title:   [                         ]
 

4

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Exhibit A to
EARNINGS ASSIGNMENT

FORM OF NOTICE OF ASSIGNMENT

The undersigned, [SHIPOWNER], the Owner of the Hong Kong flag vessel “[VESSEL]”,
hereby gives you notice that by an Earnings Assignment
dated                            2007, entered into by us with DNB NOR BANK ASA,
NEW YORK BRANCH in its capacity as Collateral Agent for certain Lenders
(hereinafter called the “Assignee”), a copy of which is attached hereto, there
has been assigned by us to the Assignee all earnings effected and to be effected
in respect of the said vessel, and all such earnings are to be paid to the
account of the Owner (Account No. []) at 200 Park Avenue, New York, New York
10166-0396.

[SHIPOWNER]
as Owner,

By:  __________________
Name:
Title:

Dated:  _____________

5

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Exhibit B to
EARNINGS ASSIGNMENT
[Form of]

CHARTER ASSIGNMENT

No.  ___
[SHIPOWNER]
Official Number [OFFICIAL NUMBER]

[SHIPOWNER], a Marshall Islands corporation and registered under Part XI of the
Hong Kong Companies Ordinance having its principal place of business at 15th
Floor, Tower One, Lippo Centre, 89 Queensway, Hong Kong (the “Assignor”), refers
to an Earnings Assignment dated 2007 (the “Earnings Assignment”) given by the
Assignor in favor of DNB NOR BANK ASA, NEW YORK BRANCH, a bank incorporated
under the laws of the Kingdom of Norway, acting through its New York branch,
with offices at 200 Park Avenue, New York, New York 10166-0396, as Collateral
Agent (the “Assignee”), under the Credit Agreement referred to below, wherein
the Assignor agreed to enter into a Charter Assignment in the event the Assignor
entered or intended to enter into any charter or contract of affreightment or
other agreement for employment of the Vessel for a period of twelve (12) months
or longer including permitted extensions and renewals.

The Assignor represents that it has entered or intends to enter into a charter
(the “Charter”) with a charterer acceptable to the Assignee (the “Charterer”),
and agrees that Section 1 of the Earnings Assignment is hereby amended to add to
the description of collateral contained in said Section all of the Assignor’s
right, title and interest in and to the Charter, all earnings and freights
thereunder, and all amounts due the Assignor thereunder, and the Assignor does
hereby grant, sell, convey, assign, transfer, mortgage and pledge to the
Assignee, and unto the Assignee’s successors and assigns, all its right, title,
interest, claim and demand in and to, and hereby does also grant unto the
Assignee, a security interest in and to, the Charter and all claims for damages
arising out of the breach of and rights to terminate the Charter, and any
proceeds of any of the foregoing.

The Assignor hereby warrants that upon execution of any Charter, the Assignor
will promptly give notice to the Charterer of the Earnings Assignment (in the
form of Exhibit A to the Earnings Assignment) as provided by Section 6 of the
Earnings Assignment and the Assignor will use its best efforts to obtain the
consent of the Charterer as evidenced by the execution by the Charterer of the
Charterer’s Consent and Agreement in the form attached hereto as Annex 1.

The Assignor reconfirms that the Earnings Assignment including all of the rights
and liabilities, covenants and obligations therein remains in full force and
effect.

Terms used herein and not otherwise defined herein are used as defined in, or by
reference in, the Earnings Assignment.

The Assignor hereby agrees that so long as this Charter Assignment is in effect
it will not terminate said Charter, or amend, modify, supplement, or waive any
material term of said Charter in a manner adverse to the Assignee, in each case
without first obtaining the written consent of the Assignee therefor.  The
Assignor hereby agrees to notify the Assignee in writing of any arbitration.
 
 
 
6

--------------------------------------------------------------------------------

No amendment or modification of the Charter, and no consent, waiver or approval
with respect thereto shall be valid unless joined in, in writing, by the
Assignee.  No notice, request or demand under the Charter, shall be valid as
against the Assignee unless and until a copy thereof is furnished to the
Assignee.

THIS ASSIGNMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE
CONSTRUED IN ACCORDANCE WITH AND BE GOVERNED BY THE LAW OF THE STATE OF NEW YORK
WITHOUT REGARD TO ITS CONFLICT OF LAWS RULES (OTHER THAN TITLE 14 OF ARTICLE 5
OF THE GENERAL OBLIGATIONS LAW).  This Assignment shall not be amended and/or
varied except by agreement in writing signed by the parties hereto.

IN WITNESS WHEREOF, the Assignor has caused this Charter Assignment No.___ to be
duly executed this ____ day of __________________.

[SHIPOWNER],
as Assignor

By:  ___________________
Name:
Title:
 

7

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Annex I to
Exhibit B to
EARNINGS ASSIGNMENT

[Form of]

CHARTERER’S CONSENT AND AGREEMENT

No. __

[VESSEL]

Official Number [OFFICIAL NUMBER]

The undersigned, charterer of the Hong Kong flag vessel [VESSEL] pursuant to a
time charter-party dated [DATE OF TIME CHARTER PARTY] (the “Charter”), does
hereby acknowledge notice of the assignment by the Assignor of all the
Assignor’s right, title and interest in and to the Charter to DNB NOR BANK ASA,
NEW YORK BRANCH, as Collateral Agent (the “Assignee”), pursuant to a Charter
Assignment dated 200_ and an Earnings Assignment dated 2007 (as the same may be
amended, supplemented or otherwise modified from time to time, the
“Assignment”), consents to such assignment, and agrees that, it will make
payment of all moneys due and to become due under the Charter, direct to the
account maintained with the Assignee located at 200 Park Avenue, New York, New
York 10166-0396 (Account No. [       ]) or such account specified by the
Assignee at such address as the Assignee shall request the undersigned in
writing until receipt of written notice from the Assignee that all obligations
of the Assignor to it have been paid in full.

The undersigned agrees that it shall look solely to the Assignor for performance
of the Charter and that the Assignee shall have no obligation or liability under
or pursuant to the Charter arising out of the Assignment, nor shall the Assignee
be required or obligated in any manner to perform or fulfill any obligations of
the Assignor under or pursuant to the Charter.

The undersigned agrees that it shall not seek from the Assignee the recovery of
any payment actually made by it to the Assignee pursuant to this Charterer’s
Consent and Agreement once such payment has been made.  This provision shall not
be construed to relieve the Assignor of any liability to the Charterer.

The undersigned agrees to execute and deliver, or cause to be executed and
delivered, upon the written request of the Assignee any and all such further
instruments and documents as the Assignee may deem desirable for the purpose of
obtaining the full benefits of this Assignment and of the rights and power
herein granted.

The undersigned agrees that no amendment, modification or alteration of any
material terms or provisions of the Charter shall be made unless the same shall
be consented to in writing by the Assignee.

The undersigned hereby confirms that the Charter is a legal, valid and binding
obligation, enforceable against it in accordance with its terms.
 
 
 
 
 
8

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Dated:  _______________

[CHARTERER],
as Charterer

By:  ___________________
Name:
Title:

9

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                  Exhibit H-2              
    

 
[CLOSING DATE]

ASSIGNMENT OF INSURANCES

[VESSEL]
Official Number [OFFICIAL NUMBER]

[SHIPOWNER], a Marshall Islands corporation and registered under Part XI of the
Hong Kong Companies Ordinance having its principal place of business at 15th
Floor, Tower One, Lippo Centre, 89 Queensway, Hong Kong (the “Assignor”), in
consideration of the Secured Creditors referred to below entering into the
transactions described in the Credit Agreement (as defined below), and for One
Dollar ($1) lawful money of the United States of America, and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, as sole owner of the Hong Kong flag vessel [VESSEL], Official
Number [OFFICIAL NUMBER] (the “Vessel”), has sold, assigned, transferred and set
over, and by this instrument as beneficial owner does sell, assign, transfer and
set over, unto DNB NOR BANK ASA, NEW YORK BRANCH, a bank incorporated under the
laws of the Kingdom of Norway, acting through its New York branch, with offices
at 200 Park Avenue, New York, New York 10166-0396, as Collateral Agent
(hereinafter called the “Assignee”), and unto the Assignee’s successors and
assigns, as such to it and its successors’ and assigns’ own proper use and
benefit, and does hereby grant to the Assignee a security interest in, all
right, title and interest of the Assignor under, in and to (i) all insurances in
respect of the Vessel, whether now or hereafter to be effected, and all renewals
of or replacements for the same, (ii) all claims, returns of premium and other
moneys and claims for moneys due and to become due under said insurance or in
respect of said insurance, and (iii) all other rights of the Assignor under or
in respect of said insurance, including proceeds (the above clauses (i), (ii)
and (iii) collectively called the “Insurance Collateral”).

Terms used herein and not otherwise defined herein are used as defined in the
Credit Agreement dated as of __ July, 2007 (as the same may be amended,
supplemented or otherwise modified from time to time, the “Credit Agreement”)
among (i) various Lenders referred to therein and (ii) the Assignee, , as
Administrative Agent, mandated lead arranger, bookrunner and Collateral Agent,
providing for the making of revolving loans to the Borrower in the principal
amount of up to One Billion Three Hundred Seventy Seven Million United States
Dollars (U.S. $1,377,000,000) (the Lenders, the Administrative Agent and
Collateral Agent, collectively, the “Lender Creditors”).

The Assignor is a wholly-owned subsidiary of the Borrower.  The Borrower may at
any time and from time to time enter into, or guaranty the obligations of one or
more Subsidiary Guarantors or any of their respective Subsidiaries under, one or
more Interest Rate Protection Agreements or Other Hedging Agreements with
respect to the Loans (and/or the Commitments) with one or more Lenders or any
Affiliate thereof (each such Lender or Affiliate, even if the respective Lender
subsequently ceases to be a Lender under the Credit Agreement for any reason,
together with such Lender’s or Affiliate’s successors and assigns, if any,
collectively, the “Other Creditors” and, together with the Lender Creditors, the
“Secured Creditors”).

The Assignor has entered into the Guaranty in favor of the Secured Creditors
pursuant to which the Assignor has guaranteed (i) to the Lender Creditors, all
obligations of the Borrower under the Credit Agreement and each other Credit
Document to which the Borrower is a party, and (ii) to each of the Other
Creditors, all obligations of the Borrower under each Interest Rate Protection
Agreement and each Other Hedging Agreement entered into with respect to the
Loans (and/or the Commitments), and
 
 
 

--------------------------------------------------------------------------------

 
 
 
the Assignor has granted the Assignee a first priority Hong Kong Mortgage and a
deed of covenants collateral thereto (together, the “Mortgage”) on the Vessel to
secure, among other things, its obligations under the Guaranty.

This Assignment is given as security for all amounts due and to become due to
the Secured Creditors under the Guaranty.

It is expressly agreed that anything herein contained to the contrary
notwithstanding, the Assignor shall remain liable under said insurances to
perform all of the obligations assumed by it thereunder, and the Assignee shall
have no obligation or liability under said insurances by reason of or arising
out of this instrument of assignment nor shall the Assignee be required or
obligated in any manner to perform or fulfill any obligations of the Assignor
under or pursuant to said insurances or to make any payment or to make any
inquiry as to the nature or sufficiency of any payment received by it or to
present or file any claim, or to take any other action to collect or enforce the
payment of any amounts which may have been assigned to it or to which it may be
entitled hereunder at any time or times.

The Assignor does hereby constitute the Assignee, its successors and assigns,
the Assignor’s true and lawful attorney-in-fact, irrevocably, with full power
(in the name of the Assignor or otherwise), upon the occurrence and continuance
of a Default, an Event of Default or an Event of Loss to ask, require, demand,
receive, compound and give acquittance for any and all moneys and claims for
moneys due and to become due under or arising out of said insurances, to endorse
any checks or other instruments or orders in connection therewith and to file
any claims or to take any action or institute any proceedings which the Assignee
may deem to be necessary or advisable in the premises.

The Assignor hereby covenants and agrees to procure that notice of this
Assignment shall be duly given to all underwriters, substantially in the form
hereto attached as Exhibit A, and that where the consent of any underwriter is
required pursuant to any of the insurances assigned hereby that it shall be
obtained and evidence thereof shall be given to the Assignee, or, in the
alternative, that in the case of protection and indemnity coverage the Assignee
shall obtain a letter of undertaking by the underwriters, and that there shall
be duly endorsed upon all slips, cover notes, policies, certificates of entry or
other instruments issued or to be issued in connection with the insurances
assigned hereby such clauses as to loss payees as the Assignee may require or
approve.  In all cases, unless otherwise agreed in writing by the Assignee, such
slips, cover notes, notices, certificates of entry or other instruments shall
provide that there will be no recourse against the Assignee for payment of
premiums, calls or assessments.

The Assignor agrees that at any time and from time to time, upon the written
request of the Assignee, the Assignor will promptly and duly execute and deliver
any and all such further instruments and documents as the Assignee may deem
desirable in obtaining the full benefits of this Assignment and of the rights
and powers herein granted.

The Assignor does hereby warrant and represent that it has not assigned or
pledged, and hereby covenants that, without the prior written consent thereto of
the Assignee, so long as this instrument of assignment shall remain in effect,
it will not assign or pledge the whole or any part of the right, title and
interest hereby assigned to anyone other than the Assignee, its successors and
assigns, and it will not take or omit to take any action, the taking or omission
of which might result in an alteration or
 
 
2

--------------------------------------------------------------------------------

 
 
 
impairment of said insurances, of this Assignment or of any of the rights
created by said insurances or this Assignment.

All notices or other communications which are required to be made to the
Assignee hereunder shall be made by postage prepaid letter or telecopy confirmed
by postage prepaid letter to:

DnB Nor Bank ASA, New York Branch
200 Park Avenue
31st Floor
New York, NY 10166-0396
Attention:  Nikolai Nachamkin
Telephone: 212-681-3863
Facsimile:  212-681-3933

or at such other address as may have been furnished in writing by the Assignee.

Any payments made pursuant to the terms hereof shall be made to such account as
may, from time to time, be designated by the Assignee or as the Assignee may
otherwise instruct.

THIS ASSIGNMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE
CONSTRUED IN ACCORDANCE WITH AND BE GOVERNED BY THE LAW OF THE STATE OF NEW YORK
WITHOUT REGARD TO ITS CONFLICT OF LAWS RULES (OTHER THAN TITLE 14 OF ARTICLE 5
OF THE GENERAL OBLIGATIONS LAW).  This Assignment shall not be amended and/or
varied except by agreement in writing signed by the parties hereto.

IN WITNESS WHEREOF, the Assignor has caused this Insurance Assignment to be duly
executed the day and year first above written.

[SHIPOWNER],
as Assignor

By:  __________________
Name: [                         ]
Title: [                           ]

3

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EXHIBIT A
to
Insurance Assignment

NOTICE OF ASSIGNMENT

The undersigned, [SHIPOWNER], the Owner of the Hong Kong Vessel [VESSEL], hereby
gives you notice that by an Insurance Assignment dated                  2007
entered into by us with DNB NOR BANK ASA, NEW YORK BRANCH, as Collateral Agent
(hereinafter called the “Assignee”), there has been assigned by us to the
Assignee all insurances effected and to be effected in respect thereof including
the insurances constituted by the policy whereon this Notice is endorsed.  This
Notice of Assignment and the applicable loss payable clauses in the form hereto
attached as Annex I are to be endorsed on all policies and certificates of entry
evidencing such insurance.

Dated:                                           2007

[SHIPOWNER],
as Owner

By  ____________________
Name:
Title:
 
 

4

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ANNEX I
Notice of Insurance Assignment

FORM OF LOSS PAYABLE CLAUSES

Hull and War Risks

Loss, if any, payable to DNB NOR BANK ASA, NEW YORK BRANCH, as Collateral Agent
(the “Mortgagee”), for distribution by the Mortgagee to itself as Collateral
Agent and to [SHIPOWNER], as owner (the “Owner”), as their respective interests
may appear, or order, except that, unless Underwriters have been otherwise
instructed by notice in writing from the Mortgagee, in the case of any loss
involving any damage to the Vessel or liability of the Vessel, the Underwriters
may pay directly for the repair, salvage, liability or other charges involved
or, if the Owner shall have first fully repaired the damage and paid the cost
thereof, or discharged the liability or paid all of the salvage or other
charges, then the Underwriters may pay the Owner as reimbursements
therefore;  provided, however, that if such damage involves a loss in excess of
U.S.$1,000,000 or its equivalent the Underwriters shall not make such payment
without first obtaining the written consent thereto of the Mortgagee.

In the event of an actual or constructive total loss or a compromise or arranged
total loss or requisition of title, all insurance payments therefor shall be
paid to the Mortgagee, for distribution by it in accordance with the terms of
the Mortgage.

Protection and Indemnity

Loss, if any, payable to DNB NOR BANK ASA, NEW YORK BRANCH, as Collateral Agent
(the “Mortgagee”), for distribution by the Mortgagee to itself as Collateral
Agent and [SHIPOWNER], Owner, as their respective interests may appear, or
order, except that, unless and until the Underwriters have been otherwise
instructed by notice in writing from the Mortgagee, any loss may be paid
directly to the person to whom the liability covered by this insurance has been
incurred, or to the Owner to reimburse it for any loss, damage or expenses
incurred by it and covered by this insurance, provided the Underwriters shall
have first received evidence that the liability insured against has been
discharged.
 
 

5

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                  EXHIBIT I              
      
                
    

FORM OF COMPLIANCE CERTIFICATE
 
This Compliance Certificate (this “Certificate”) is delivered to you on behalf
of the Company (as hereinafter defined) pursuant to Section 10.01(e) of the
Credit Agreement, dated as of July __, 2007 (as amended, supplemented, restated
or modified from time to time, the “Credit Agreement”), among Genco Shipping &
Trading Limited, a corporation organized under the laws of the Republic of
Marshall Islands (the “Company”), the Lenders from time to time party thereto,
DnB Nor Bank ASA, New York Branch, as Administrative Agent and Collateral
Agent.  Terms defined in the Credit Agreement and not otherwise defined herein
are used herein as therein defined.
 
1.  I am the duly elected, qualified and acting Chief Financial Officer of the
Company.
 
2.   I have reviewed and am familiar with the contents of this Certificate.  I
am providing this Certificate solely in my capacity as an officer of the
Company.  The matters set forth herein are true to the best of my knowledge
after diligent inquiry.
 
3.  I have reviewed the terms of the Credit Agreement and the other Credit
Documents and have made or caused to be made under my supervision, a review in
reasonable detail of the transactions and financial condition of the Company
during the accounting period covered by the financial statements attached hereto
as ANNEX 1 (the “Financial Statements”).  The Financial Statements have been
prepared in accordance with the requirements of the Credit Agreement.
 
4.  Attached hereto as ANNEX 2 are the computations showing (in reasonable
detail) compliance with the covenants specified therein.  All such computations
are true and correct.
 
5.  On the date hereof, the representations and warranties contained in the
Credit Agreement and in the other Credit Documents are true and correct in all
material respects with the same effect as though such representations and
warranties had been made on the date hereof, unless stated to relate to a
specific earlier date, in which case such representations and warranties were
true and correct in all material respects as of such earlier date.
 
[6.  On the date hereof, no Default or Event of Default has occurred and is
continuing.]1
 
 
 
 
1
If any Default or Event of Default exists, include a description thereof,
specifying the nature and extent thereof (in reasonable detail).

 
 
 

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Exhibit I
Page 2

IN WITNESS WHEREOF, I have executed this Certificate on behalf of the Company
this ____ day of July, 2007.
 
GENCO SHIPPING & TRADING LIMITED
 
By______________________
    Name:
    Title:
 
 
 
 
 
 
 
 

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Annex 1 to
Compliance Certificate
 
 
CONSOLIDATED FINANCIAL STATEMENTS
 
 
 
 
 
 

--------------------------------------------------------------------------------

 
 
 
Annex 2 to
Compliance Certificate
 

COMPLIANCE WORKSHEET
 
The calculations described herein is as of __________ __, ____ (the “Computation
Date”) and pertains to the period from __________ __, ____ to __________ __,
____ (the “Test Period”).
 

 
 
Part A.  Consolidated Interest Coverage Ratio
 
1.           Consolidated Net Income for the Test Period.
$_______________
2.           Provisions for taxes based on income for the TestPeriod.
$_______________
3.           Consolidated interest expense for the Test Period.
$_______________
4.           Amortization or write-off of deferred financing coststo the extent
deducted in determining ConsolidatedNet Income for the Test Period.
 
 
$_______________
5.           Depreciation expense of the Company and itsSubsidiaries for the
Test Period.
 
$_______________
6.           Amortization expense of the Company and itsSubsidiaries for the
Test Period.
 
$_______________
7.           Losses on sales of assets (excluding sales in theordinary course of
business) and other extraordinarylosses for the Test Period.
 
 
$_______________
8.           Gains on sales of assets (excluding sales in the ordinary course of
business) and other extraordinary gains for the Test Period.
 
 
$_______________
9.           Consolidated EBITDA (sum of Items 1 through 7minus Item 8).
 
$_______________
10.         Consolidated Interest Expense for the four immediately preceding
fiscal quarters.
 
$_______________
11.         Consolidated Interest Coverage Ratio (Item 9:Item10).
 
__________:1.00
12.         Minimum Interest Coverage Ratio pursuant to Section 11.07 of the
Credit Agreement on the Computation Date.
 
2.00:1.00

 
 

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Annex 2
Page 2 
 
Part B.  Maximum Leverage Ratio
 
1.           Consolidated Indebtedness on the Computation Date.
$_______________
2.           Consolidated Total Capitalization on the ComputationDate.
 
$_______________
3.           Leverage Ratio (Item 1:Item 2) on the ComputationDate.
 
__________:1.00
4.           Maximum Leverage Ratio pursuant to Section 11.08 of the Credit
Agreement:
 
 
5.50:1.00
 

 

 
 
Part C.  Collateral Maintenance
 
1.Aggregate principal amount of outstanding Loans and all Letter of Credit
Outstandings on the Computation Date.
 
 
$_______________
2.Aggregate Appraised Value on the Computation Date.
$_______________
3.Minimum permitted Aggregate Appraised Value pursuant to Section 11.09 of the
Credit Agreement (Item 1 multiplied by 1.30).
$_______________

 

 
 
Part D.  Minimum Cash Balance
 
1.Consolidated cash and Cash Equivalents subject to a Lien of the Security
Documents on the Computation Date.
 
$_______________
2.Aggregate amount of all undrawn credit facilities with maturities in excess of
twelve months on the Computation Date.
 
 
$_______________
3.Item 1 plus Item 2 above is greater than $500,000 multiplied by the number of
Mortgaged Vessels in existence on the Computation Date.
 

 

2

--------------------------------------------------------------------------------

 
Annex 2
Page 3
 
Part E.  Minimum Consolidated Net Worth
 
1.            Consolidated Net Worth on the Computation Date, which shall be
greater than [_______] as required pursuant to Section 11.11 of the Credit
Agreement.
 
$________________

 

 
 
 
3

--------------------------------------------------------------------------------

 
Annex 3 to
Compliance Certificate

 
1.           It is hereby certified that no changes are required to be made to
any of Schedule VII of the Credit Agreement or Annexes A through F of the Pledge
Agreement, in each case so as to make the information set forth therein accurate
and complete as of date of this Certificate, except as specially set forth
below:

[All actions required to be taken by the Credit Agreement and the Security
Documents as a result of the changes described above have been taken, and the
Collateral Agent has, for the benefit of the Secured Creditors (as defined in
the Pledge Agreement), a first priority  perfected security interest in all
Collateral pursuant to the various Security Documents to the extent required by
the terms thereof.]2

 

 

--------------------------------------------------------------------------------

 
2
The bracketed language must be inserted if there have been any changes to the
information, as contemplated by Section 10.01(e)(i)(y) of the Credit Agreement.

 
 
 

--------------------------------------------------------------------------------

      
        Exhibit J      
    

 
FORM OF SUBORDINATION PROVISIONS
 
 
Section 1.01.  Subordination of Liabilities.  [Name of Payor] (the “Payor”), for
itself, its successors and assigns, covenants and agrees, and each holder of the
Note to which this Annex __ is attached (the “Note”) by its acceptance thereof
likewise covenants and agrees, that the payment of the principal of, interest
on, and all other amounts owing in respect of, the Note (the “Subordinated
Indebtedness”) is hereby expressly subordinated, to the extent and in the manner
set forth below, to the prior payment in full in cash of all Senior Indebtedness
(as defined in Section 1.07 of this Annex __).  The provisions of this Annex __
shall constitute a continuing offer to all persons or other entities who, in
reliance upon such provisions, become holders of, or continue to hold, Senior
Indebtedness, and such holders are made obligees hereunder the same as if their
names were written herein as such, and they and/or each of them may proceed to
enforce such provisions.
 
Section 1.02.  Payor Not to Make Payments with Respect to Subordinated
Indebtedness in Certain Circumstances.  (a) Upon the maturity of any Senior
Indebtedness (including interest thereon or fees or any other amounts owing in
respect thereof), whether at stated maturity, by acceleration or otherwise, all
Obligations (as defined in Section 1.07 of this Annex __) owing in respect of
the Senior Indebtedness shall first be paid in full in cash in accordance with
the terms thereof, before any payment of any kind or character, whether in cash,
property, securities or otherwise, is made on account of the Subordinated
Indebtedness.
 
(b)           The Payor may not, directly or indirectly (and no person or other
entity on behalf of the Payor may), make any payment of any Subordinated
Indebtedness and may not acquire any Subordinated Indebtedness for cash or
property until all Senior Indebtedness has been paid in full in cash if any
Default (as defined in the Credit Agreement identified in Section 1.07 herein)
or Event of Default (as defined in the Credit Agreement identified in Section
1.07 herein) under the Credit Agreement (as defined in Section 1.07 of this
Annex __) has occurred and is continuing or would result therefrom.  Each holder
of the Note hereby agrees that, so long as any such Default or Event of Default
in respect of any issue of Senior Indebtedness has occurred and is continuing,
it will not sue for, or otherwise take any action to enforce the Payor’s
obligations to pay, amounts owing in respect of the Note.  Each holder of the
Note understands and agrees that to the extent that clause (a) of this Section
1.02 or this clause (b) prohibits the payment of any Subordinated Indebtedness,
such unpaid amount shall not constitute a payment default under the Note and the
holder of the Note may not sue for, or otherwise take action to enforce the
Payor’s obligation to pay such amount, provided that such unpaid amount shall
remain an obligation of the Payor to the holder of the Note pursuant to the
terms of the Note.  Notwithstanding the foregoing, so long as a Default or Event
of Default has not occurred, Payor will be entitled to make (and any person or
other entity on behalf of the Payor shall be entitled to make) and a holder of
any Note will be entitled to receive scheduled payments of principal and
interest under the Subordinated Indebtedness.
 
(c)           In the event that, notwithstanding the provisions of the preceding
subsections (a) and (b) of this Section 1.02, the Payor (or any Person on behalf
of the Payor) shall make (or the holder of the Note shall receive) any payment
on account of the Subordinated
 
 

--------------------------------------------------------------------------------

 
Exhibit J
Page 2
 
 
Indebtedness at a time when payment is not permitted by said subsection (a) or
(b), such payment shall be held by the holder of the Note, in trust for the
benefit of, and shall be paid forthwith over and delivered to, the holders of
Senior Indebtedness or their representative or the trustee under the indenture
or other agreement pursuant to which any instruments evidencing any Senior
Indebtedness may have been issued, as their respective interests may appear
(including by giving effect to any intercreditor or subordination arrangements
among such holders), for application pro rata to the payment of all Senior
Indebtedness remaining unpaid to the extent necessary to pay all Senior
Indebtedness in full in cash in accordance with the terms of such Senior
Indebtedness, after giving effect to any concurrent payment or distribution to
or for the holders of Senior Indebtedness.
 
Section 1.03.  Subordination to Prior Payment of All Senior Indebtedness on
Dissolution, Liquidation or Reorganization of Payor.  Upon any distribution of
assets of the Payor upon dissolution, winding up, liquidation or reorganization
of the Payor (whether in bankruptcy, insolvency or receivership proceedings or
upon an assignment for the benefit of creditors or otherwise):
 
(a)           the holders of all Senior Indebtedness shall first be entitled to
receive payment in full in cash of all Senior Indebtedness in accordance with
the terms thereof (including, without limitation, post-petition interest at the
rate provided in the documentation with respect to the Senior Indebtedness,
whether or not such post-petition interest is an allowed claim against the
debtor in any bankruptcy or similar proceeding) before the holder of the Note is
entitled to receive any payment of any kind or character on account of the
Subordinated Indebtedness;
 
(b)           any payment or distributions of assets of the Payor of any kind or
character, whether in cash, property or securities to which the holder of the
Note would be entitled except for the provisions of this Annex __, shall be paid
by the liquidating trustee or agent or other person making such payment or
distribution, whether a trustee in bankruptcy, a receiver or liquidating trustee
or other trustee or agent, directly to the holders of Senior Indebtedness or
their representative or representatives, or to the trustee or trustees under any
indenture under which any instruments evidencing any such Senior Indebtedness
may have been issued as their respective interests may appear (including by
giving effect to any intercreditor or subordination arrangements among such
holders), to the extent necessary to make payment in full in cash of all Senior
Indebtedness remaining unpaid, after giving effect to any concurrent payment or
distribution to the holders of such Senior Indebtedness; and
 
(c)           in the event that, notwithstanding the foregoing provisions of
this Section 1.03, any payment or distribution of assets of the Payor of any
kind or character, whether in cash, property or securities, shall be received by
the holder of the Note on account of Subordinated Indebtedness before all Senior
Indebtedness is paid in full in cash in accordance with the terms thereof, such
payment or distribution shall be received and held in trust for and shall be
paid over to the holders of the Senior Indebtedness remaining unpaid or their
representative or representatives, or to the trustee or trustees under any
indenture under which any instruments evidencing any of such Senior Indebtedness
may have been issued, as their respective interests may appear (including
 
 

--------------------------------------------------------------------------------

 
Exhibit J
Page 3
 
 
 by giving effect to any intercreditor or subordination arrangements among such
holders) for application to the payment of such Senior Indebtedness until all
such Senior Indebtedness shall have been paid in full in cash in accordance with
the terms thereof, after giving effect to any concurrent payment or distribution
to the holders of such Senior Indebtedness.
 
Section 1.04.  Subrogation.  Subject to the prior payment in full in cash of all
Senior Indebtedness in accordance with the terms thereof, the holder of the Note
shall be subrogated to the rights of the holders of Senior Indebtedness to
receive payments or distributions of assets of the Payor applicable to the
Senior Indebtedness until all amounts owing on the Note shall be paid in full,
and for the purpose of such subrogation no payments or distributions to the
holders of the Senior Indebtedness by or on behalf of the Payor or by or on
behalf of the holder of the Note by virtue of this Annex __ which otherwise
would have been made to the holder of the Note shall, as between the Payor, its
creditors other than the holders of Senior Indebtedness, and the holder of the
Note, be deemed to be payment by the Payor to or on account of the Senior
Indebtedness, it being understood that the provisions of this Annex __ are and
are intended solely for the purpose of defining the relative rights of the
holder of the Note, on the one hand, and the holders of the Senior Indebtedness,
on the other hand.
 
Section 1.05.  Obligation of the Payor Unconditional.  Nothing contained in this
Annex __ or in the Note is intended to or shall impair, as between the Payor and
the holder of the Note, the obligation of the Payor, which is absolute and
unconditional, to pay to the holder of the Note the principal of and interest on
the Note as and when the same shall become due and payable in accordance with
their terms, or is intended to or shall affect the relative rights of the holder
of the Note and creditors of the Payor other than the holders of the Senior
Indebtedness, nor shall anything herein or therein prevent the holder of the
Note from exercising all remedies otherwise permitted by applicable law upon an
event of default under the Note, subject to the provisions of this Annex __ and
the rights, if any, under this Annex __ of the holders of Senior Indebtedness in
respect of cash, property, or securities of the Payor received upon the exercise
of any such remedy.  Upon any distribution of assets of the Payor referred to in
this Annex __, the holder of the Note shall be entitled to rely upon any order
or decree made by any court of competent jurisdiction in which such dissolution,
winding up, liquidation or reorganization proceedings are pending, or a
certificate of the liquidating trustee or agent or other person making any
distribution to the holder of the Note, for the purpose of ascertaining the
persons entitled to participate in such distribution, the holders of the Senior
Indebtedness and other indebtedness of the Payor, the amount thereof or payable
thereon, the amount or amounts paid or distributed thereon and all other facts
pertinent thereto or to this Annex __.
 
Section 1.06.  Subordination Rights Not Impaired by Acts or Omissions of Payor
or Holders of Senior Indebtedness.  No right of any present or future holders of
any Senior Indebtedness to enforce subordination as herein provided shall at any
time in any way be prejudiced or impaired by any act or failure to act on the
part of the Payor or by any act or failure to act in good faith by any such
holder, or by any noncompliance by the Payor with the terms and provisions of
the Note, regardless of any knowledge thereof which any such holder may have or
be otherwise charged with.  The holders of the Senior Indebtedness may, without
in any way affecting the obligations of the holder of the Note with respect
hereto, at any time or from time to time and in their absolute discretion,
change the manner, place or terms of payment of, change or
 
 

--------------------------------------------------------------------------------

 
Exhibit J
Page 4
 
extend the time of payment of, or renew, increase or otherwise alter, any Senior
Indebtedness or amend, modify or supplement any agreement or instrument
governing or evidencing such Senior Indebtedness or any other document referred
to therein, or exercise or refrain from exercising any other of their rights
under the Senior Indebtedness including, without limitation, the waiver of
default thereunder and the release of any collateral securing such Senior
Indebtedness, all without notice to or assent from the holder of the Note.
 
Section 1.07.  Senior Indebtedness.  The term “Senior Indebtedness” shall mean
all Obligations (as defined below) (i) of the Payor under, or in respect of, (x)
the Credit Agreement (as amended, modified, supplemented, extended, restated,
refinanced, replaced or refunded from time to time, the “Credit Agreement”),
dated as of July __, 2007, by and among Genco Shipping & Trading Limited, the
lenders from time to time party thereto, DnB Nor Bank ASA, New York Branch, as
Administrative Agent, and any renewal, extension, restatement, refinancing or
refunding thereof, and (y) each other Credit Document (as defined in the Credit
Agreement) to which the Payor is a party, (ii) of the Payor under, or in respect
of (including by reason of any Subsidiaries Guaranty (as defined in the Credit
Agreement) to which the Payor is a party), any Interest Rate Protection
Agreements or Other Hedging Agreements (each as defined in the Credit
Agreement), and (iii) of the Payor under, or in respect of (including by reason
of any guaranty of) the Note (as defined in the Credit Agreement).  As used
herein, the term “Obligation” shall mean any principal, interest, premium,
penalties, fees, expenses, indemnities and other liabilities and obligations
(including guaranties of the foregoing liabilities and obligations) payable
under the documentation governing any Senior Indebtedness (including
post-petition interest at the rate provided in the documentation with respect to
such Senior Indebtedness, whether or not such interest is an allowed claim
against the debtor in any bankruptcy or similar proceeding).
 
 
 

--------------------------------------------------------------------------------

      
        Exhibit K      
    

FORM OF ASSIGNMENT AND ASSUMPTION AGREEMENT
 
DATE:  ________ __, ____
 
Reference is made to the Credit Agreement described in Item 2 of Annex I annexed
hereto (as such Credit Agreement may hereafter be amended, modified or
supplemented from time to time, the “Credit Agreement”).  Unless defined in
Annex I attached hereto, capitalized terms defined in the Credit Agreement are
used herein as therein defined. _____________ (the “Assignor”) and
______________ (the “Assignee”) hereby agree as follows:
 
1.  The Assignor hereby sells and assigns to the Assignee without recourse and
without representation or warranty (other than as expressly provided herein),
and the Assignee hereby purchases and assumes from the Assignor, that interest
in and to all of the Assignor’s rights and obligations under the Credit
Agreement as of the date hereof which represents the percentage interest
specified in Item 4 of Annex I attached hereto (the “Assigned Share”) of all of
the outstanding rights and obligations under the Credit Agreement relating to
each of the Facilities listed in Item 4 of Annex I attached hereto, including,
without limitation (v) in the case of any assignment of all or any portion of
the Assignor’s outstanding Loans, all rights and obligations with respect to the
Assigned Share of such outstanding Loans, and (x) in the case of any assignment
of all or any portion of the Commitment, all rights and obligations with respect
to the Assigned Share of such Commitment.
 
2.  The Assignor (i) represents and warrants that it is the legal and beneficial
owner of the interest being assigned by it hereunder and that such interest is
free and clear of any adverse claims; (ii) makes no representation or warranty
and assumes no responsibility with respect to any statements, warranties or
representations made in or in connection with the Credit Agreement or the other
Credit Documents or the execution, legality, validity, enforceability,
genuineness, sufficiency or value of the Credit Agreement or the other Credit
Documents or any other instrument or document furnished pursuant thereto; and
(iii) makes no representation or warranty and assumes no responsibility with
respect to the financial condition of the Borrower or any of its Subsidiaries or
the performance or observance by the Borrower or any of its Subsidiaries of any
of their respective obligations under the Credit Agreement or the other Credit
Documents or any other instrument or document furnished pursuant thereto.
 
3.  The Assignee (i) confirms that it is an Eligible Transferee, (ii) confirms
that it has received a copy of the Credit Agreement and the other Credit
Documents, together with copies of the financial statements referred to therein
and such other documents and information as it has deemed appropriate to make
its own credit analysis and decision to enter into this Assignment and
Assumption Agreement, (iii) agrees that it will, independently and without
reliance upon the Administrative Agent, the Collateral Agent, the Mandated Lead
Arranger, the Assignor or any other Lender and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit decisions in taking or not taking action under the Credit Agreement, (iv)
appoints and authorizes the Mandated Lead Arranger, the Administrative Agent and
the Collateral Agent to take such action as agent on its behalf and to exercise
such powers under the Credit Agreement and the other Credit Documents as are
delegated to the Mandated Lead Arranger, the Administrative Agent and the
Collateral Agent, as
 
 

--------------------------------------------------------------------------------

 
Exhibit K
Page 2
 
the case may be, by the terms thereof, together with such powers as are
reasonably incidental thereto, and (v) agrees that it will perform in accordance
with their terms all of the obligations which by the terms of the Credit
Agreement are required to be performed by it as a Lender.
 
4.  Following the execution of this Assignment and Assumption Agreement by the
Assignor and the Assignee, an executed original hereof (together with all
attachments) will be delivered to the Administrative Agent.  The effective date
of this Assignment and Assumption Agreement shall be the date of execution
hereof by the Assignor and the Assignee, the receipt of the consent of the
Administrative Agent and the Borrower (in each case) to the extent required by
the Credit Agreement, receipt by the Administrative Agent of the assignment fee
referred to in Section 15.04(b) of the Credit Agreement, and the recordation by
the Administrative Agent of the assignment effected hereby in the Register,
unless otherwise specified in Item 5 of Annex I attached hereto (the “Settlement
Date”).
 
5.  Upon the delivery of a fully executed original hereof to the Administrative
Agent, as of the Settlement Date, (i) the Assignee shall be a party to the
Credit Agreement and, to the extent provided in this Assignment and Assumption
Agreement, have the rights and obligations of a Lender thereunder and under the
other Credit Documents and (ii) the Assignor shall, to the extent provided in
this Assignment and Assumption Agreement, relinquish its rights and be released
from its obligations under the Credit Agreement and the other Credit Documents.
 
6.  It is agreed that upon the effectiveness hereof, the Assignee shall be
entitled to (x) all interest on the Assigned Share of the Loans at the rates
specified in Item 6 of Annex I attached hereto and (y) all Commitment Commission
(if applicable) on the Assigned Share of the Total Commitment at the rate
specified in Item 7 of Annex I attached hereto, which accrues on and after the
Settlement Date, such interest and, if applicable, Commitment Commission, to be
paid by the Administrative Agent directly to the Assignee.  It is further agreed
that all payments of principal made on the Assigned Share of the Loans which
occur on and after the Settlement Date will be paid directly by the
Administrative Agent to the Assignee.  Upon the Settlement Date, the Assignee
shall pay to the Assignor an amount specified by the Assignor in writing which
represents the Assigned Share of the principal amount of the respective Loans
made by the Assignor pursuant to the Credit Agreement which are outstanding on
the Settlement Date, net of any closing costs, and which are being assigned
hereunder.  The Assignor and the Assignee shall make all appropriate adjustments
in payments under the Credit Agreement for periods prior to the Settlement Date
directly between themselves.
 
7.  THIS ASSIGNMENT AND ASSUMPTION AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED
IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
 
 

--------------------------------------------------------------------------------

 
Exhibit K
 Page 3

 
IN WITNESS WHEREOF, the parties hereto have caused this Assignment and
Assumption Agreement to be executed by their respective officers thereunto duly
authorized, as of the date first above written, such execution also being made
on Annex I attached hereto.
 
[NAME OF ASSIGNOR],
 
as Assignor
 
By____________________________
    Name:
    Title:
 
[NAME OF ASSIGNEE],
 
as Assignee
 
By____________________________
    Name:
    Title:
 

 
Acknowledged and Agreed:
 
[DNB NOR BANK ASA, NEW YORK BRANCH,
 
as Administrative Agent
 
By____________________________
Name:
Title:
 
By____________________________
Name:
Title:]2
 

--------------------------------------------------------------------------------

 
2
Insert only if assignment is being made pursuant to Section 15.04(b)(y) of the
Credit Agreement.

 
 

--------------------------------------------------------------------------------

 
Exhibit K
 Page 4
 
 

[GENCO SHIPPING & TRADING LIMITED]
 
By____________________________
Name:
Title:]3
 
 
 
 
 
 
 
 

--------------------------------------------------------------------------------

 
3
Insert only if assignment is being made pursuant to Section 15.04(b)(y) of the
Credit Agreement.

 
 
 
 
 
 

--------------------------------------------------------------------------------

 
 
ANNEX I
 

ANNEX FOR ASSIGNMENT AND ASSUMPTION AGREEMENT
ANNEX I
 
1.     The Borrower:  Genco Shipping & Trading Limited (the “Borrower”).
 
2.     Name and Date of Credit Agreement:
 
Credit Agreement, dated as of July __, 2007, among the Borrower, the lenders
from time to time party thereto, DnB Nor Bank ASA, New York Branch, as
Administrative Agent and as Collateral Agent (as amended, restated, modified
and/or supplemented from time to time, the “Credit Agreement”).
 
3.     Date of Assignment Agreement:
 
4.     Amounts (as of date of item #3 above):
 

 
Outstanding Principal of
Loans
 
Commitments
    a.    Aggregate Amount for all Lenders
 
$__________
 
$_________
    b.    Assigned Share
_________%
 
 ________%
    c.    Amount of Assigned Share
 
$_________
 
$________

5.     Settlement Date:
 
6.     Rate of Interest
        to the Assignee:     As set forth in Section 1.07 of the Credit
Agreement
 
7.     Commitment Commission:As set forth in Section 3.01(a) of the Credit
Agreement

8.     Notice:                             ASSIGNEE:
 
____________________
____________________
____________________
____________________
Attention:
Reference:
 
 
 
 

--------------------------------------------------------------------------------

 
Annex I
Page2
 
 
 
 
Payment Instructions:    ASSIGNEE:
            ____________________
            ____________________
            ____________________
            ____________________
            Attention:
            Reference:
 
Accepted and Agreed:
 
[NAME OF
ASSIGNEE]                                                                                             
 [NAME OF ASSIGNOR]
 
By____________________                                                                                     
By_______________________
     Name:                                                                                                                              
Name:
     Title:                                                                                                                                
Title:

 
 
 
 
 

--------------------------------------------------------------------------------

Exhibit L-1

FORM OF
DEED OF COVENANTS
TO ACCOMPANY A FIRST PRIORITY STATUTORY MORTGAGE

ON HONG KONG FLAG VESSEL

[VESSEL]
OFFICIAL NO. [OFFICIAL NUMBER]

executed by

[SHIPOWNER],
as Shipowner

in favor of

DNB NOR BANK ASA, NEW YORK BRANCH,
as Trustee and as Mortgagee

[CLOSING DATE]

--------------------------------------------------------------------------------

TABLE OF CONTENTS
 
                                                                Page
 
ARTICLE
I                                                                            5
Section 1.                      Existence;
Authorization                                                     5
Section 2.                      Title to
Vessel                                                           5
Section 3.                      ISM, ISPS and MARPOL
Compliance                                              5
ARTICLE
II                                                                             
5
Section 1.                      Payment of
Indebtedness                                                       5
Section 2.                      Mortgage
Recording                                                       6
Section 3.                      Lawful
Operation                                                         6
Section 4.                      Payment of
Taxes                                                        6
Section 5.                      Prohibition of
Liens                                                         6
Section 6.                      Notice of
Mortgage                                                         6
Section 7.                      Removal of
Liens                                                         7
Section 8.                      Release from
Arrest                                                         7
Section
9.                      Maintenance                                                            
7
        Section 10.                    Inspection;
Reports                                                       10
        Section 11.        Flag; Home
Port                                                          10
Section 12.                    No Sales. Transfers or
Charters                                                11
Section
13.                    Insurance                                                             
11
Section 14.                    Reimbursement for
Expenses                                                    15
Section 15.                    Performance of
Charters                                                     15
Section 16.                    Change in
Ownership                                                         15
Section 17.                    Prepayment if Event of
Loss                                                 15
ARTICLE
III                                                                           
15
Section 1.                      Events of Default:
Remedies                                                     15
Section 2.                      Power of
Sale                                                           17
Section 3.                      Power of
Attorney-Sale                                                     18
Section 4.                      Power of
Attorney-Collection                                                  18
Section 5.                      Delivery of
Vessel                                                          18
Section 6.                      Mortgagee to Discharge
Liens                                                 19
Section 7.                      Payment of
Expenses                                                     19
Section 8.                      Remedies
Cumulative                                                         19
Section 9.                      Cure of
Defaults                                                          19
Section 10.                    Discontinuance of
Proceedings                                                20
Section 11.                    Application of
Proceeds                                                     20
Section 12.                    Possession Until
Default                                                    20
Section 13.                    Severability of Provisions.
etc                                                   21
ARTICLE
IV                                                                            
21
Section 1                      Successors and
Assigns                                                     21
Section 2.                      Power of
Substitution                                                         21
Section
3.                      Counterparts                                                           
22
Section
4.                      Notices                                                              22
Section 5.                      Statutory
Mortgage                                                        22
Section 6.                      Further
Assurances                                                        22
Section 7.                      Governing
Law                                                            23
Section 8.                      Additional Rights of the
Mortgagee                                               23

--------------------------------------------------------------------------------

DEED OF COVENANTS

[VESSEL]

This Deed of Covenants made [CLOSING DATE] (this “Deed”), between [SHIPOWNER], a
Republic of the Marshall Islands company and registered under Part XI of the
Hong Kong Companies Ordinance having its principal place of business at 15th
Floor, Tower One, Lippo Centre, 89 Queensway, Hong Kong (the “Shipowner”), and
DNB NOR BANK ASA, NEW YORK BRANCH, a bank incorporated under the laws of the
Kingdom of Norway, acting through its New York branch, with offices at 200 Park
Avenue, New York, New York 10166-0396 not in its individual capacity, but solely
as Security Trustee (together with its successors in trust and assigns, the
“Mortgagee”), pursuant to the Credit Agreement referred to below.

W I T N E S S E T H

WHEREAS:

A.           The Shipowner is the sole, absolute and unencumbered owner of the
whole of the Hong Kong flag vessel [VESSEL], Official Number [OFFICIAL NUMBER]
of [GROSS TONS] gross tons and [NET TONS] net tons, together with all interest
therein and all of the boilers, engines, machinery, masts, spars, boats,
anchors, cables, chains, rigging, tackle, capstans, outfit tools, pumps and
pumping equipment, apparel, furniture, drilling equipment, fittings, equipment,
spare parts, and all other appurtenances thereunto appertaining or belonging,
whether now owned or hereafter acquired, and also any and all additions,
improvements, renewals and replacements hereafter made in or to such vessel or
any part thereof, including all items and appurtenances aforesaid (such vessel,
together with all of the foregoing, being herein called the “Vessel”).

B.           Genco Shipping & Trading Limited, a Marshall Islands corporation
(the “Borrower”), the Lenders party thereto from time to time, the
Mortgagee,  as administrative agent, mandated lead arranger, bookrunner and
collateral agent, have entered into a Credit Agreement dated as of July __, 2007
(as the same may be amended, supplemented or otherwise modified from time to
time, the “Credit Agreement”), providing for the making of revolving loans to
the Borrower in the principal amount of up to One Billion Three Hundred Seventy
Seven Million United States Dollars (U.S.$1,377,000,000) (the Lenders, the
Administrative Agent and Collateral Agent, collectively, the “Lender
Creditors”).  Except as otherwise defined herein, capitalized terms used herein
and defined in the Credit Agreement shall be used herein as so defined.

C.           The Borrower may at any time and from time to time enter into, or
guaranty the obligations of one or more Subsidiary Guarantors or any of their
respective Subsidiaries under, one or more Interest Rate Protection Agreements
or Other Hedging Agreements with respect to the Loan (and/or the Commitments)
with one or more Lenders or any Affiliate thereof (each such Lender or
Affiliate, even if the respective Lender subsequently ceases to be a Lender
under the Credit Agreement for any reason, together with such Lender’s or
Affiliate’s successors and assigns, if any, collectively, the “Other Creditors”
and, together with the Lender Creditors, the “Secured Creditors”).  The
estimated aggregate notional amount of the liabilities of the Borrower under the
Interest Rate Protection Agreements or Other Hedging Agreements entered into
with respect to the Loan (and/or the Commitments) is [            ] United
States Dollars (U.S.$[      ]).

D.           The Shipowner is a wholly owned subsidiary of the Borrower.
 
 
 

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E.           The Shipowner entered into the Guaranty in favor of the Secured
Creditors pursuant to which the Shipowner has guaranteed (i) to the Lender
Creditors, all obligations of the Borrower under the Credit Agreement and each
other Credit Document to which the Borrower is a party, and (ii) to each of the
Other Creditors, all obligations of the Borrower under each Interest Rate
Protection Agreement and each Other Hedging Agreement entered into with respect
to the Loan (and/or the Commitments).  The Lenders have advanced the Loan
pursuant to the Credit Agreement;  the Shipowner acknowledges that it is justly
indebted to the Secured Creditors under the Guaranty.

F.           Contemporaneously with the execution of this Deed there has been
executed and registered by the Shipowner in favor of the Mortgagee a first
priority statutory Hong Kong ship mortgage (the “Mortgage”) to secure its
obligation under the Guaranty according to the terms thereof, and the payment of
all other such sums due or which may become due to the Mortgagee pursuant to the
Guaranty, constituting a First Priority Mortgage over the said Vessel and the
Shipowner has agreed to execute this Deed collateral to the Mortgage and to the
security thereby created.

G.           This Deed shall be read together with the Guaranty, but in the case
of any inconsistency between this Deed and the Guaranty, the provisions of this
Deed shall prevail, but only to the extent permitted by Hong Kong law.

H.           Pursuant to the Credit Agreement, the Mortgagee has agreed to act
as Trustee for the Secured Creditors.

NOW, THIS DEED WITNESSETH AS FOLLOWS:

1.           In consideration of the premises and other good and valuable
consideration, the Shipowner hereby covenants with the Mortgagee to pay each and
every sum of money that may be or become owing under the terms of the Guaranty
and the Mortgage or either of them at the time and in the manner specified
therein, (all such obligations and other sums hereinafter called the
“Indebtedness hereby secured”).

2.           By way of security for payment of the Indebtedness secured hereby,
the Shipowner as beneficial owner hereby MORTGAGES AND CHARGES to and in favor
of the Mortgagee all its interest, present and future, in the Vessel and
proceeds thereof (which the Shipowner hereby warrants to be free at the date
hereof from any other charges or encumbrances whatsoever).

3.           The Shipowner and the Mortgagee hereby covenant with each other
that the security created by this Deed, the Guaranty and any of the other Credit
Documents to which the Shipowner is a party shall be held by the Mortgagee as
continuing security, and that the security so created shall not be satisfied by
any intermediate payment of any part of the Indebtedness secured hereby.

4.           Upon the Mortgagee being satisfied that the Indebtedness secured
hereby has been unconditionally and irrevocably paid and discharged in full, and
following a written request therefor from the Shipowner, the Mortgagee will,
subject to being indemnified in scope and substance to its satisfaction for the
costs and expenses incurred by it in connection therewith, release the security
created by the Mortgage and this Deed.

5.           The Shipowner shall remain liable to fulfill all obligations
assumed by it in relation to the Vessel and the Mortgagee shall be under no
obligation of any kind whatsoever in respect thereof or
 
 
 
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be under any liability whatsoever in event of any failure by the Shipowner to
perform its obligations in respect thereof.

It is hereby covenanted, declared and agreed that the property above described
is to be held subject to the further covenants, conditions, terms and uses
hereinafter set forth.

The Shipowner covenants and agrees with the Mortgagee as follows:

ARTICLE I

Representations and Warranties of the Shipowner

Section 1.                      Existence; Authorization.  The Shipowner is a
company duly organized and validly existing under the laws of the Republic of
the Marshall Islands having its principal place of business in Hong Kong, and
shall so remain during the life of this Deed.  The Shipowner has full power and
authority to own and mortgage the Vessel; has full right and entitlement to
register the Vessel in its name under the flag of Hong Kong and all action
necessary and required by law for the execution and delivery of this Deed and
the Mortgage has been duly and effectively taken; and each of the Indebtedness
hereby secured and this Deed and the Mortgage is and will be the legal, valid
and binding obligation of the Shipowner enforceable in accordance with its
terms.

Section 2.                      Title to Vessel.  The Shipowner lawfully owns
and is lawfully possessed of the Vessel free from any lien or encumbrance
whatsoever other than the Mortgage, liens for current crew’s wages and liens not
yet required to be removed under Section 7 of Article II hereof and will warrant
and defend the title and possession thereto and to every part thereof for the
benefit of the Mortgagee against the claims and demands of all persons
whomsoever.

Section 3.                      ISM, ISPS and MARPOL Compliance.  The Shipowner
has obtained all necessary ISM Documentation in connection with the Vessel and
is in full compliance with the ISM Code, the ISPS Code and Annex VI (Regulations
for the Prevention of Air Pollution from Ships) to MARPOL (as such terms are
defined in Section 9 of Article II).

ARTICLE II

Covenants of the Shipowner

Section 1.                      Payment of Indebtedness.  The Shipowner will pay
or cause to be paid the Indebtedness hereby secured and will observe, perform
and comply with the covenants, terms and conditions herein and in the Guaranty,
express or implied, on its part to be observed, performed or complied with.  The
obligation of the Indebtedness hereby secured is an obligation in United States
Dollars and the term “$” when used herein shall mean such United States
Dollars.  Notwithstanding fluctuations in the value or rate of United States
Dollars in terms of gold or any other currency, all payments hereunder or
otherwise in respect of the Indebtedness hereby secured shall be payable in
terms of United States Dollars when due, in United States Dollars when paid,
whether such payment is made before or after the due date.

Section 2.                      Mortgage Recording.  The Shipowner will cause
the Mortgage to be duly recorded or filed in the Shipping Registry of Hong Kong,
in accordance with the applicable provisions of the laws of Hong Kong and will
otherwise comply with and satisfy all of the provisions of applicable
 
 
 
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 laws of Hong Kong in order to establish and maintain (a) the Mortgage as a
first priority statutory mortgage thereunder upon the Vessel and upon all
renewals, replacements and improvements made in or to the same and (b) this Deed
as a first priority assignment of, charge over, and security interest in the
Vessel or other property assigned hereunder.

Section 3.                      Lawful Operation.  The Shipowner will not cause
or permit the Vessel to be operated in any manner contrary to law, and the
Shipowner will not engage in any unlawful trade or violate any law or carry any
cargo that will expose the Vessel to penalty, forfeiture or capture, and will
not do, or suffer or permit to be done, anything which can or may injuriously
affect the registration of the Vessel under the laws and regulations of Hong
Kong and will at all times keep the Vessel duly documented thereunder.

Section 4.                      Payment of Taxes.  The Shipowner will pay and
discharge when due and payable, from time to time, all taxes, assessments,
governmental charges, fines and penalties lawfully imposed on the Vessel or any
income therefrom.

Section 5.                      Prohibition of Liens.  Neither the Shipowner,
any charterer, the Master of the Vessel nor any other person has or shall have
any right, power or authority to create, incur or permit to be placed or imposed
or continued upon the Vessel, its freights, profits or hire any lien whatsoever
other than the Mortgage, this Deed, other liens in favor of the Mortgagee and
for crew’s wages and salvage.

Section 6.                      Notice of Mortgage.  The Shipowner will place,
and at all times and places will retain a properly certified copy of the
Mortgage and a true copy of this Deed on board the Vessel with her papers and
will cause such certified copy and the Vessel’s marine document to be exhibited
to any and all persons having business therewith which might give rise to any
lien thereon other than liens for crew’s wages and salvage, and to any
representative of the Mortgagee.

The Shipowner will place and keep prominently displayed in the chart room and in
the Master’s cabin on the Vessel a framed printed notice in plain type reading
as follows:

NOTICE OF MORTGAGE

THIS VESSEL IS OWNED BY [SHIPOWNER], AND IS SUBJECT TO A FIRST PRIORITY
STATUTORY MORTGAGE AND DEED OF COVENANTS COLLATERAL THERETO IN FAVOR OF DNB NOR
BANK ASA, NEW YORK BRANCH, AS TRUSTEE/MORTGAGEE.  UNDER THE TERMS OF SAID DEED,
NEITHER THE SHIPOWNER, ANY CHARTERER, THE MASTER OF THE VESSEL, NOR ANY OTHER
PERSON HAS ANY RIGHT, POWER OR AUTHORITY TO CREATE, INCUR OR PERMIT TO BE PLACED
OR IMPOSED UPON THE VESSEL, ANY ENCUMBRANCES WHATSOEVER OR ANY OTHER LIEN
WHATSOEVER OTHER THAN FOR CREW’S WAGES AND SALVAGE.

Section 7.                      Removal of Liens.  Except for the lien of this
Deed and the Mortgage, the Shipowner will not suffer to be continued any lien,
encumbrance or charge on the Vessel, and in due course and in any event within
thirty (30) days after the same becomes due and payable or within fourteen (14)
days after being requested to do so by the Mortgagee, the Shipowner will pay or
cause to be discharged or make adequate provision for the satisfaction or
discharge of all claims or demands, and will cause the Vessel to be released or
discharged from any lien, encumbrance or charge therefor.
 
 
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Section 8.                      Release from Arrest.  If a libel, complaint or
similar process be filed against the Vessel or the Vessel be otherwise attached,
levied upon or taken into custody by virtue of any legal proceeding in any
court, the Shipowner will promptly notify the Mortgagee thereof by telex, or
telefax confirmed by letter, at the address, as specified in this Deed, and
within fourteen (14) days will cause the Vessel to be released and all liens
thereon other than the Mortgage and this Deed to be discharged, will cause a
certificate of discharge to be recorded in the case of any recording of a notice
of claim of lien, and will promptly notify the Mortgagee thereof in the manner
aforesaid.  The Shipowner will notify the Mortgagee within forty-eight (48)
hours of any average or salvage incurred by the Vessel.

Section 9.                      Maintenance.  (a) The Shipowner will at all
times and without cost or expense to the Mortgagee maintain and preserve, or
cause to be maintained and preserved, the Vessel and all its equipment, outfit
and appurtenances, tight, staunch, strong, in good condition, working order and
repair and in all respects seaworthy and fit for its intended service, and will
keep the Vessel, or cause her to be kept, in such condition as will entitle her
to the highest classification and rating for vessels of the same age and type in
American Bureau of Shipping or other classification society listed on Schedule
VIII to the Credit Agreement.  The Shipowner covenants to deliver annually to
the Mortgagee a certificate from such class society showing such classification
to be maintained.  The Shipowner will without cost or expense to the Mortgagee
promptly, irrevocably and unconditionally instruct and authorize the
classification society of the Vessel, and shall request the classification
society to give an undertaking to the Mortgagee as follows:

1.           to send to the Mortgagee, following receipt of a written request
from the Mortgagee, certified true copies of all original class records held by
the classification society relating to the Vessel;

2.           to allow the Mortgagee (or its agents), at any time and from time
to time, to inspect the original class and related records of the Shipowner and
the Vessel at the offices of the classification society and to take copies of
them;

3.           following receipt of a written request from the Mortgagee:

(a)           to advise of any facts or matters which may result in or have
resulted in a change, suspension, discontinuance, withdrawal or expiry of the
Vessel’s class under the rules or terms and conditions of the Shipowner’s or the
Vessel’s membership of the classification society; and

(b)           to confirm that the Shipowner is not in default of any of its
contractual obligations or liabilities to the classification society and,
without limiting the foregoing, that it has paid in full all fees or other
charges due and payable to the classification society; and

(c)           if the Shipowner is in default of any of its contractual
obligations or liabilities to the classification society, to specify to the
Mortgagee in reasonable detail the facts and circumstances of such default, the
consequences thereof, and any remedy period agreed or allowed by the
classification society; and
 
 
 
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(d)           to notify the Mortgagee immediately in writing if the
classification society receives notification from the Shipowner or any other
person that the Vessel’s classification society is to be changed.

Notwithstanding the above instructions and undertaking given for the benefit of
the Mortgagee, the Shipowner shall continue to be responsible to the
classification society for the performance and discharge of all its obligations
and liabilities relating to or arising out of or in connection with the contract
it has with the classification society, and nothing herein or therein shall be
construed as imposing any obligation or liability of the Mortgagee to the
classification society in respect thereof.

The Shipowner shall further notify the classification society that all the
foregoing instructions and authorizations shall remain in full force and effect
until revoked or modified by written notice to the classification society
received from the Mortgagee, and that the Shipowner shall reimburse the
classification society for all its costs and expenses incurred in complying with
the foregoing instructions.

(b)           The Vessel shall, and the Shipowner covenants that it will, at all
times comply with all applicable laws, treaties and conventions to which Hong
Kong is a party, and rules and regulations issued thereunder, and shall have on
board as and when required thereby valid certificates showing compliance
therewith.  The Shipowner will not make, or permit to be made, any substantial
change in the structure, type or speed of the Vessel or change in her rig,
without first receiving the written approval thereof by the Mortgagee.

(c)           The Shipowner agrees to give the Mortgagee at least ten (10) days
notice of the actual date and place of any survey or dry docking, in order that
the Mortgagee may have representatives present if desired.  The Shipowner agrees
that at the Mortgagee’s request it will satisfy the Mortgagee that the expense
of such survey or drydocking or work to be done thereat is within Shipowner’s
financial capability and will not result in a claim or lien against the Vessel
in violation of the provisions of this Deed, the Credit Agreement, the Guaranty
or any other Credit Document.

(d)           The Shipowner shall promptly notify the Mortgagee of and furnish
the Mortgagee with full information, including copies of reports and surveys,
regarding any material accident or accident involving repairs where the
aggregate cost is likely to exceed Two Million Five Hundred Thousand Dollars
(U.S. $2,500,000) (or its equivalent in another currency), any major damage to
the Vessel, any event affecting the Vessel’s class, any occurrence in
consequence whereof the Vessel has become or is likely to suffer an Event of
Loss.

(e)           The Mortgagee shall have the right at any time, on reasonable
notice, to have its surveyor conduct inspections and surveys of the Vessel to
ascertain the condition of the Vessel and to satisfy itself that the Vessel is
being properly repaired and maintained.  Such inspections and surveys shall be
conducted at such times and in such manner as will not interfere with the
Shipowner’s normal business operations and schedule.

(f)           The Shipowner will furnish to the Mortgagee on demand true and
complete copies of the DOC (the SMC referred to in the definition of ISM Code
Documentation below) and such other ISM Code documentation as the Mortgagee may
reasonably request in writing.
 
 
 
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(g)           The Shipowner will comply or procure compliance with the ISM Code,
the ISPS Code and Annex VI (Regulations for the Prevention of Air Pollution from
Ships) to MARPOL (as such terms are defined below) and notify the Mortgagee
forthwith upon:

(i)           any claim for breach of the ISM Code or the ISPS Code being made
against the Shipowner, an ISM Responsible Person (as such term is defined below)
or the manager of the Vessel in connection with the Vessel; or

(ii)           any other matter, event or incident, actual or which will or
could lead to the ISM Code or the ISPS Code or Annex VI (Regulations for the
Prevention of Air Pollution from Ships) to MARPOL not being complied with;

and keep the Mortgagee advised in writing on a regular basis and in such detail
as the Mortgagee shall require, of the Shipowner’s and Vessel manager’s response
to the items referred to in subclauses (i) and (ii) above.

For the purposes of this Mortgage:

“ISM Code” means in relation to its application the Shipowner, the Vessel and
its operation:

(a)           ‘The International Management Code for the Safe Operation of Ships
and for Pollution Prevention’, currently known or referred to as the ‘ISM Code’,
adopted by the Assembly of the International Maritime Organization by Resolution
A.741(18) on 4 November 1993 and incorporated on 19 May 1994 into Chapter IX of
the International Convention for the Safety of Life at Sea 1974 (SOLAS 1974);
and

(b)           all further resolutions, circulars, codes, guidelines, regulations
and recommendations which are now or in the future issued by or on behalf of the
International Maritime Organization or any other entity with responsibility for
implementing the ISM Code, including without limitation, the ‘Guidelines on
implementation or administering of the International Safety Management (ISM)
Code by Administrations’ produced by the International Maritime Organization
pursuant to Resolution A.788(19) adopted on 25 November 1995,

as the same may be amended, supplemented or replaced from time to time;

“ISM Code Documentation” includes:

(a)           the document of compliance (DOC) and safety management certificate
(SMC) issued pursuant to the ISM Code in relation to the Vessel within the
periods specified by the ISM Code;

(b)           the interim safety management certificate (“Interim SMC”) issued
pursuant to the ISM Code in relation to the Vessel prior to or on the delivery
date thereof;

(c)           all other documents and data which are relevant to the ISM SMS and
its implementation and verification which the mortgage may require by request;
and
 
 
 
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(d)           any other documents which are prepared or which are otherwise
relevant to establish and maintain the Vessel’s or the Shipowner’s compliance
with the ISM Code which the Mortgagee may require by request.

“ISM SMS” means the safety management system which is required to be developed,
implemented and maintained under the ISM Code.

“ISPS Code” means the International Ship and Port Facility Security Code
constituted pursuant to resolution A.924(22) of the International Maritime
Organisation (“IMO”) adopted by a Diplomatic conference of the IMO on Maritime
Security on 13 December 2002 and now set out in Chapter XI-2 of the Safety of
Life at Sea Convention (SOLAS) 1974 (as amended) adopted on July 1, 2004.

"MARPOL" means the International Convention for the Prevention of Pollution from
Ships 1973 (as modified in 1978 and 1997) and includes any amendments or
extensions of it and any regulation issued pursuant to it.

Section 10.                                Inspection; Reports.  (a) The
Shipowner will at all reasonable times afford the Mortgagee or its authorized
representatives full and complete access to the Vessel for the purpose of
inspecting the Vessel and her cargo and papers, including without limitation all
records pertaining to the Vessel’s maintenance and repair, and, at the request
of the Mortgagee, the Shipowner will deliver for inspection copies of any and
all contracts and documents relating to the Vessel, whether on board or not.

(b)           The Shipowner hereby agrees to furnish promptly to the Mortgagee,
on demand, any reports or information which the Shipowner may submit to
shareholders or regulatory agencies and any additional information which the
Mortgagee may request in respect of the financial condition of the Shipowner.

Section 11.                                Flag; Home Port.  (a) The Shipowner
will not change the flag or home port of the Vessel without the written consent
of the Mortgagee and any such written consent to any one change of flag or home
port shall not be construed to be a waiver of this provision with respect to any
subsequent proposed change of flag or home port.

(b)           Notwithstanding the foregoing provisions of this Section 11, upon
not less than 30 days prior written notice to the Mortgagee, provided no Default
or Event of Default under the Credit Agreement shall have occurred and be
continuing, the Shipowner may change the flag or home port of the Vessel to
another flag or home port reasonably satisfactory to the Mortgagee, provided
that the Shipowner shall promptly take all actions necessary or desirable to
establish, preserve, protect and maintain the security interest of the Mortgagee
in the Vessel to the satisfaction of the Mortgagee, and the Shipowner shall have
provided to the Mortgagee and the Lenders such opinions of counsel as may be
reasonably requested by the Mortgagee to assure itself that the conditions of
this proviso have been satisfied.

Section 12.                                No Sales. Transfers or Charters.  The
Shipowner will not sell, mortgage, transfer, or change the management of, or
demise charter the Vessel for any period longer than twelve (12) months
(including any permitted extensions or renewals) in each case, without the
written consent (not to be unreasonably withheld) of the Mortgagee first had and
obtained, and any such written
 
 
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consent to any one sale, mortgage, demise charter, transfer, or change of
management shall not be construed to be a waiver of this provision with respect
to any subsequent proposed sale, mortgage, demise charter, transfer, or change
of management.  Any such sale, mortgage, demise charter, transfer, or change of
management of the Vessel shall be subject to the provisions of this Deed, the
Mortgage and the lien thereof.

Section 13.                                Insurance.  (a) The Shipowner, at its
own expense, or with respect to part (a)(iii) of this Section 13 the Mortgagee
at the expense of the Shipowner, will keep the Vessel insured with insurers and
protection and indemnity clubs or associations of internationally recognized
responsibility, and placed in such markets, on such terms and conditions, and
through brokers, in each case reasonably satisfactory to the Mortgagee and under
forms of policies approved by the Mortgagee against the risks indicated below
and such other risks as the Mortgagee may specify from time to time:

(i)           Marine and war risk, including London Blocking and Trapping
Addendum and Lost Vessel Clause, hull and machinery insurance in an amount in
U.S. dollars equal to, except as otherwise approved or required in writing by
the Mortgagee, the greater of (x) the then full commercial value of the Vessel
or (y) an amount which, when aggregated with such insured value of the other
Mortgaged Vessels (if the other Mortgaged Vessels are then subject to a mortgage
in favor of the Mortgagee under the Credit Agreement, and have not suffered an
Event of Loss), is equal to 120% of the then outstanding aggregate principal
amount of the Loan.

(ii)           Marine and war risk protection and indemnity insurance or
equivalent insurance (including coverage against liability for passengers, fines
and penalties arising out of the operation of the Vessel, insurance against
liability arising out of pollution, spillage or leakage, and workmen’s
compensation or longshoremen’s and harbor workers’ insurance as shall be
required by applicable law) in such amounts approved by the
Mortgagee;  provided, however that insurance against liability under law or
international convention arising out of pollution, spillage or leakage shall be
in an amount not less than the greater of:

(y)           the maximum amount available, as that amount may from time to time
change, from the International Group of Protection and Indemnity Associations or
alternatively such sources of pollution, spillage or leakage coverage as are
commercially available in any absence of such coverage by the International
Group as shall be carried by prudent shipowners for similar vessels engaged in
similar trades plus amounts available from customary excess insurers of such
risks as excess amounts shall be carried by prudent shipowners for similar
vessels engaged in similar trades; and

(z)           the amounts required by the laws or regulations of the United
States of America or any applicable jurisdiction in which the Vessel may be
trading from time to time.

(iii)           Mortgagee’s interest insurance (including extended mortgagee
interest-additional perils-pollution) coverage satisfactory to the Mortgagee in
an amount which, when aggregated with such insured value of the other Mortgaged
Vessels (if the other Mortgaged Vessels are then subject to a mortgage in favor
of the Mortgagee under the Credit Agreement, and have not suffered an Event of
Loss), is equal to 110% of the then outstanding aggregate principal amount of
the Loan.  All such mortgagee’s interest insurance cover shall in
 
 
 
 
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 the Mortgagee’s discretion be obtained directly by the Mortgagee and the
Shipowner shall on demand pay all costs of such cover.

(iv)           While the Vessel is idle or laid up, at the option of the
Shipowner and in lieu of the above-mentioned marine and war risk hull insurance,
port risk insurance insuring the Vessel against the usual risks encountered by
like vessels under similar circumstances.

(b)           The marine and commercial war-risk insurance required by this
Section 13 shall have deductibles and franchises not exceeding those that a
reasonable prudent owner would agree for a vessel of the type, age and condition
of the Vessel.

All insurance maintained hereunder shall be primary insurance without right of
contribution against any other insurance maintained by the Mortgagee.  Each
policy of marine and war risk hull and machinery insurance with respect to the
Vessel shall provide that the Mortgagee shall be a named insured and a loss
payee.  Each entry in a marine and war risk protection indemnity club with
respect to the Vessel shall note the interest of the Mortgagee.  The Mortgagee
and its successors and assigns shall not be responsible for any premiums, club
calls, assessments or any other obligations or for the representations and
warranties made therein by the Shipowner or any other person.

(c)           The Shipowner will furnish the Mortgagee from time to time on
request, and in any event at least annually, a detailed report signed by a firm
of marine insurance brokers acceptable to the Mortgagee with respect to P & I
entry, the hull and machinery and war risk insurance carried and maintained on
the Vessel, together with their opinion as to the adequacy thereof and its
compliance with the provisions of this Deed.  At the Shipowner’s expense the
Shipowner will cause such insurance broker and the P & I club or association
providing P & I insurance referred to in part (a)(ii) of this Section 13, to
agree to advise the Mortgagee by telex or telecopier confirmed by letter of any
expiration, termination, alteration or cancellation of any policy, any default
in the payment of any premium and of any other act or omission on the part of
the Shipowner of which it has knowledge and which might invalidate or render
unenforceable, in whole or in part, any insurance on the Vessel, and to provide
an opportunity of paying any such unpaid premium or call, such right being
exercisable by the Mortgagee on a vessel by vessel and not on a fleet basis.  In
addition, the Shipowner shall promptly provide the Mortgagee with any
information which the Mortgagee reasonably requests for the purpose of obtaining
or preparing any report from an independent marine insurance consultant as to
the adequacy of the insurances effected or proposed to be effected in accordance
with this Deed as of the date hereof or in connection with any renewal thereof,
and the Shipowner shall upon demand indemnify the Mortgagee in respect of all
reasonable fees and other expenses incurred by or for the account of the
Mortgagee in connection with any such report;  provided the Mortgagee shall be
entitled to such indemnity only for one such report during any period of twelve
months.

The underwriters or brokers shall furnish the Mortgagee with a letter or letters
of undertaking to the effect that:

(i)           they will hold the instruments of insurance, and the benefit of
the insurances thereunder, to the order of the Mortgagee in accordance with the
terms of the loss payable clause referred to in the relevant Assignment of
Insurances for the Vessel;  and

(ii)           they will have endorsed on each and every policy as and when the
same is issued the loss payable clause and the notice of assignment referred to
in the relevant Assignment of Insurances for the Vessel;  and
 
 
 
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(iii)           they will not set off against any sum recoverable in respect of
a claim against the Vessel under the said underwriters or brokers or any other
person in respect of any other vessel nor cancel the said insurances by reason
of non-payment of such premiums or other amounts.

All policies of insurance required hereby shall provide for not less than 14
days prior written notice to be received by the Mortgagee of the termination or
cancellation of the insurance evidenced thereby.  All policies of insurance
maintained pursuant to this Section 13 for risks covered by insurance other than
that provided by a P & I Club shall contain provisions waiving underwriters’
rights of subrogation thereunder against any assured named in such policy and
any assignee of said assured.  The Shipowner has assigned to the Mortgagee its
rights under any policies of insurance in respect of the Vessel.  The Shipowner
agrees that, unless the insurances by their terms provide that they cannot cease
(by reason of nonrenewal or otherwise) without the Mortgagee being informed and
having the right to continue the insurance by paying any premiums not paid by
the Shipowner, receipts showing payment of premiums for required insurance and
also of demands from the Vessel’s P & I underwriters shall be in the hands of
the Mortgagee at least two (2) days before the risk in question commences.

(d)           Unless the Mortgagee shall otherwise agree, all amounts of
whatsoever nature payable under any insurance must be payable to the Mortgagee
for distribution first to itself and thereafter to the Shipowner or others as
their interests may appear.  Nevertheless, until otherwise required by the
Mortgagee by notice to the underwriters upon the occurrence and continuance of a
Default or an event of default hereunder, (i) amounts payable under any
insurance on the Vessel with respect to protection and indemnity risks may be
paid directly to the Shipowner to reimburse it for any loss, damage or expense
incurred by it and covered by such insurance or to the person to whom any
liability covered by such insurance has been incurred provided that the
underwriter shall have first received evidence that the liability insured
against has been discharged, and (ii) amounts payable under any insurance with
respect to the Vessel involving any damage to the Vessel not constituting an
Event of Loss, may be paid by underwriters directly for the repair, salvage or
other charges involved or, if the Shipowner shall have first fully repaired the
damage or paid all of the salvage or other charges, may be paid to the Shipowner
as reimbursement therefor;  provided, however, that if such amounts (including
any franchise or deductible) are in excess of U.S. $[1,000,000], the
underwriters shall not make such payment without first obtaining the written
consent thereto of the Mortgagee, which shall not be unreasonably withheld.

(e)           All amounts paid to the Mortgagee in respect of any insurance on
the Vessel shall be disposed of as follows (after deduction of the expenses of
the Mortgagee in collecting such amounts):

(i)           any amount which might have been paid at the time, in accordance
with the provisions of paragraph (d) above, directly to the Shipowner or others
shall be paid by the Mortgagee to, or as directed by, the Shipowner;

(ii)           all amounts paid to the Mortgagee in respect of an Event of Loss
(as defined in the Credit Agreement) of the Vessel shall be applied by the
Mortgagee to the payment of the Indebtedness hereby secured pursuant to Section
4.02(b) of the Credit Agreement;

(iii)           all other amounts paid to the Mortgagee in respect of any
insurance on the Vessel may, in the Mortgagee’s sole discretion, be held and
applied to the prepayment of the Indebtedness hereby secured or to making of
needed repairs or other work on the Vessel, or to
 
 
 
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        the payment of other claims incurred by the Shipowner relating to the
Vessel, or may be paid to the Shipowner or whosoever may be entitled thereto.

(f)           In the event that any claim or lien is asserted against the Vessel
for loss, damage or expense which is covered by insurance required hereunder and
it is necessary for the Shipowner to obtain a bond or supply other security to
prevent arrest of the Vessel or to release the Vessel from arrest on account of
such claim or lien, the Mortgagee, on request of the Shipowner, may, in the sole
discretion of the Mortgagee, assign to any person, firm or corporation executing
a surety or guarantee bond or other agreement to save or release the Vessel from
such arrest, all right, title and interest of the Mortgagee in and to said
insurance covering said loss, damage or expense, as collateral security to
indemnify against liability under said bond or other agreement.

(g)           The Shipowner shall deliver to the Mortgagee certified copies and,
whenever so requested by the Mortgagee, the originals of all certificates of
entry, cover notes, binders, evidences of insurance and policies and all
endorsements and riders amendatory thereof in respect of insurance maintained
under this Deed for the purpose of inspection or safekeeping, or, alternatively,
satisfactory letters of undertaking from the broker holding the same.  The
Mortgagee shall be under no duty or obligation to verify the adequacy or
existence of any such insurance or any such policies, endorsement or riders.

(h)           The Shipowner agrees that it will not execute or permit or
willingly allow to be done any act by which any insurance may be suspended,
impaired or cancelled, and that it will not permit or allow the Vessel to
undertake any voyage or run any risk or transport any cargo which may not be
permitted by the policies in force, without having previously notified the
Mortgagee in writing and insured the Vessel by additional coverage to extend to
such voyages, risks, passengers or cargoes.

(i)           In case any underwriter proposes to pay less on any claim than the
amount thereof, the Shipowner shall forthwith inform the Mortgagee, and if a
Default, an Event of Default or an Event of Loss has occurred and is continuing,
the Mortgagee shall have the exclusive right to negotiate and agree to any
compromise.

(j)           The Shipowner will comply with and satisfy all of the provisions
of any applicable law, convention, regulation, proclamation or order concerning
financial responsibility for liabilities imposed on the Shipowner or the Vessel
with respect to pollution by any state or nation or political subdivision
thereof and will maintain all certificates or other evidence of financial
responsibility as may be required by any such law, convention, regulation,
proclamation or order with respect to the trade in which the Vessel is from time
to time engaged and the cargo carried by it.

Section 14.                                Reimbursement for Expenses.  The
Shipowner will reimburse the Mortgagee promptly for any and all reasonable
expenditures which the Mortgagee may from time to time make, layout or expend in
providing such protection in respect of insurance, discharge or purchase of
liens, taxes, dues, tolls, assessments, governmental charges, fines and
penalties lawfully imposed, repairs, attorney’s fees, and other matters as the
Shipowner is obligated herein to provide, but fails to provide or which, in the
sole judgment of the Mortgagee are necessary or appropriate for the protection
of the Vessel or the security granted by this Deed.  Such obligation of the
Shipowner to reimburse the Mortgagee shall be an additional indebtedness due
from the Shipowner, shall bear interest at the interest rate as set forth in
Section 1.07(b) of the Credit Agreement from the date of payment by the
Mortgagee to and including the date of reimbursement by the Shipowner, shall be
secured by this Deed and the Mortgage, and shall be payable by the Shipowner on
demand.  The Mortgagee, though
 
 
 
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 privileged to do so, shall be under no obligation to the Shipowner to make any
such expenditure, nor shall the making thereof relieve the Shipowner of any
default in that respect.

Section 15.                                Performance of Charters.  The
Shipowner will fully perform any and all charter parties which may be entered
into with respect to the Vessel and will promptly notify the Mortgagee of any
material claim by any charterer of non-performance thereunder by the Shipowner.

Section 16.                                Change in Ownership.  The Shipowner
further covenants and agrees with the Mortgagee that, so long as any part of the
Indebtedness hereby secured remains unpaid, there shall be no change in the
ownership of the Vessel or any of the shares of the Shipowner without the prior
written consent of the Mortgagee, which shall not be unreasonably withheld.

Section 17.                                Prepayment if Event of Loss.  In the
event that the Vessel suffers an Event of Loss, then and in each such case the
Shipowner shall forthwith repay the Indebtedness hereby secured at the time and
in the amount set forth in Section 4.02(b) of the Credit Agreement except to the
extent such amounts have otherwise been paid as therein provided.

ARTICLE III

Events of Default and Remedies

Section 1.                      Events of Default: Remedies.  In case anyone or
more of the following events, herein termed “events of default”, shall happen:

(a)           the Shipowner fails to pay within three (3) Business Days of the
date due any payment in respect of the Indebtedness hereby secured as provided
herein; or

(b)           the statements in Article I shall prove to have been untrue in a
material way when made; or

(c)           a default in the due and punctual observance and performance of
any of the provisions of Sections 2, 3, 7, 8, 9(b), 11, 12, 13(a), (b), (d), (h)
and (j), 16 or 17 of Article II hereof shall have occurred and be continuing; or

(d)           a breach or omission in the due and punctual observance of any of
the other covenants and conditions herein required to be kept and performed by
the Shipowner and such breach or omission shall continue for 30 days after the
day the Shipowner first knew or should have known of such breach or omission; or

(e)           an Event of Default shall have occurred and be continuing under
the Credit Agreement; or

(f)           a payment default by the Borrower under any Interest Rate
Protection Agreement or Other Hedging Agreement shall have occurred and be
continuing; or

(g)           any notice shall have been issued by the government or any bureau,
department, officer, board or agency thereof of the country of registry of the
Vessel to the effect that the Vessel is subject to cancellation from such
registry or the certificate of registry of the Vessel is subject to revocation
or cancellation for any reason whatsoever, and such notice shall not have been
cancelled or
 
 
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 annulled on or before seven (7) Business Days prior to the date set forth in
such notice for such cancellation or revocation; or

(h)           the Vessel shall be cancelled from the country of registry of the
Vessel or the certificate of registry of the Vessel is revoked or cancelled for
any reason whatsoever;

then:

the security constituted by this Deed and the Mortgage shall become immediately
enforceable and that without limitation, the enforcement remedies specified can
be exercised irrespective of whether or not the Mortgagee has exercised the
right of acceleration under the Credit Agreement or any of the other Credit
Documents and the Mortgagee shall have the right to:

(i)           Declare all the then unpaid Indebtedness hereby secured to be due
and payable immediately, and upon such declaration, the same shall become and be
immediately due and payable provided, however, that no declaration shall be
required if an event of default shall have occurred by reason of a default under
Section 10.05 of the Credit Agreement, then and in such case, the Indebtedness
hereby secured shall become immediately due and payable on the occurrence of
such event of default without any notice or demand;

(ii)           Exercise all of the rights and remedies in foreclosure and
otherwise given to a mortgagee by the provisions of the laws of the country of
registry of the Vessel or of any other jurisdiction where the Vessel may be
found;

(iii)           Bring suit at law, in equity or in admiralty, as it may be
advised, to recover judgment for the Indebtedness hereby secured, and collect
the same out of any and all property of the Shipowner whether covered by this
Mortgage or otherwise;

(iv)           Take and enter into possession of the Vessel, at any time,
wherever the same may be, without legal process and without being responsible
for loss or damage and the Shipowner or other person in possession forthwith
upon demand of the Mortgagee shall surrender to the Mortgagee possession of the
Vessel;

(v)           Without being responsible for loss or damage, the Mortgagee may
hold, lay up, lease, charter, operate or otherwise use such Vessel for such time
and upon such terms as it may deem to be for its best advantage, and demand,
collect and retain all hire, freights, earnings, issues, revenues, income,
profits, return premiums, salvage awards or recoveries, recoveries in general
average, and all other sums due or to become due in respect of such Vessel or in
respect of any insurance thereon from any person whomsoever, accounting only for
the net profits, if any, arising from such use of the Vessel and charging upon
all receipts from the use of the Vessel or from the sale thereof by court
proceedings or pursuant to subsection (vi) next following, all costs, expenses,
charges, damages or losses by reason of such use; and if at any time the
Mortgagee shall avail itself of the right herein given them to take the Vessel,
the Mortgagee shall have the right to dock the Vessel, for a reasonable time at
any dock, pier or other premises of the Shipowner without charge, or to dock her
at any other place at the cost and expense of the Shipowner;

(vi)           Without being responsible for loss or damage, the Mortgagee may
sell the Vessel upon such terms and conditions as to the Mortgagee shall seem
best, free from any
 
 
 
 
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claim of or by the Shipowner, at public or private sale, by sealed bids or
otherwise, by mailing, by air or otherwise, notice of such sale, whether public
or private, addressed to the Shipowner at its last known address and to any
other registered mortgagee, twenty (20) calendar days prior to the date fixed
for entering into the contract of sale and by first publishing notice of any
such public sale for ten (10) consecutive days, in daily newspapers of general
circulation published in the City of New York, State of New York; in the event
that the Vessel shall be offered for sale by private sale, no newspaper
publication of notice shall be required, nor notice of adjournment of sale; sale
may be held at such place and at such time as the Mortgagee by notice may have
specified, or may be adjourned by the Mortgagee from time to time by
announcement at the time and place appointed for such sale or for such adjourned
sale, and without further notice or publication the Mortgagee may make any such
sale at the time and place to which the same shall be so adjourned; and any sale
may be conducted without bringing the Vessel to the place designated for such
sale and in such manner as the Mortgagee may deem to be for its best advantage,
and the Mortgagee may become the purchaser at any sale.  The Shipowner agrees
that any sale made in accordance with the terms of this paragraph shall be
deemed made in a commercially reasonable manner insofar as it is concerned;

(vii)           Require that all policies, contracts, certificates of entry and
other records relating to the insurance with respect to the Vessel, including,
but not limited to, those described in Article II, Section 13 hereof (the
“Insurances”) (including details of and correspondence concerning outstanding
claims) be forthwith delivered to or to the order of the Mortgagee; and/or

(viii)                      Collect, recover, compromise and give a good
discharge for any and all monies and claims for monies then outstanding or
thereafter arising under the Insurances or in respect of the earnings or any
requisition compensation and to permit any brokers through whom collection or
recovery is effected to charge the usual brokerage therefor.

Section 2.                      Power of Sale.  Any sale of the Vessel made in
pursuance of this Deed, whether under the power of sale hereby granted or any
judicial proceedings, shall operate to divest all right, title and interest of
any nature whatsoever of the Shipowner therein and thereto, and shall bar the
Shipowner, its successors and assigns, and all persons claiming by, through or
under them.  No purchaser shall be bound to inquire whether notice has been
given, or whether any default has occurred, or as to the propriety of the sale,
or as to the application of the proceeds thereof.  In case of any such sale, the
Mortgagee, if it is the purchaser, shall be entitled, for the purpose of making
settlement or payment for the property purchased, to use and apply the
Indebtedness hereby secured in order that there may be credited against the
amount remaining due and unpaid thereon the sums payable out of the net proceeds
of such sale to the Mortgagee after allowing for the costs and expense of sale
and other charges; and thereupon such purchaser shall be credited, on account of
such purchase price, with the net proceeds that shall have been so credited upon
the Indebtedness hereby secured.  At any such sale, the Mortgagee may bid for
and purchase such property and upon compliance with the terms of sale may hold,
retain and dispose of such property without further accountability therefor.

Section 3.                      Power of Attorney-Sale.  The Mortgagee is hereby
irrevocably appointed attorney-in-fact of the Shipowner to execute and deliver
to any purchaser aforesaid, and is hereby vested with full power and authority
to make, in the name and on behalf of the Shipowner, a good conveyance of the
title to the Vessel so sold.  Any person dealing with the Mortgagee or
attorney-in-fact shall not be put on enquiry as to whether the power of attorney
contained herein has become exercisable.  In the event of any sale of the
Vessel, under any power herein contained, the
 
 
 
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 Shipowner will, if and when required by the Mortgagee, execute such form of
conveyance of the Vessel as the Mortgagee may direct or approve.

Section 4.                      Power of Attorney-Collection.  The Mortgagee is
hereby irrevocably appointed attorney-in-fact of the Shipowner upon the
happening of any event of default, in the name of the Shipowner to demand,
collect, receive, compromise and sue for, so far as may be permitted by law, all
freight, hire, earnings, issues, revenues, income and profits of the Vessel and
all amounts due from underwriters under any insurance thereon as payment of
losses or as return premiums or otherwise, salvage awards and recoveries,
recoveries in general average or otherwise, and all other sums due or to become
due at the time of the happening of any event of default as defined in Section 1
of Article III hereof in respect of the Vessel, or in respect of any insurance
thereon, from any person whomsoever, and to make, give and execute in the name
of the Shipowner acquittances, receipts, releases or other discharges for the
same, whether under seal or otherwise, and to endorse and accept in the name of
the Shipowner all checks, notes, drafts, warrants, agreements and other
instruments in writing with respect to the foregoing.  Any person dealing with
the Mortgagee or attorney-in-fact shall not be put on enquiry as to whether the
Power of Attorney contained herein has become exercisable.

Section 5.                      Delivery of Vessel.  Upon the security
constituted by this Deed and the Mortgage becoming immediately enforceable
pursuant to Section 1 of Article III, the Mortgagee shall (in addition to the
powers described in Section 1 of Article III) become forthwith entitled (but not
bound) to appoint, by an instrument in writing under its seal or under the hand
of any director or officer or authorized signatory, a receiver and/or manager of
the Vessel upon such terms as to remuneration and otherwise as the Mortgagee
shall deem fit with power from time to time to remove any receiver and appoint
another in his stead and any receiver shall be the agent of the Shipowner (who
shall be solely responsible for his acts and defaults and remuneration) and
shall have all the powers conferred by law by way of addition to, but without
limiting, those powers any receiver shall have all the powers and entitlements
conferred on the Mortgagee by this Deed and generally shall be entitled to the
same protection and to exercise the same powers and discretions as are granted
to the Mortgagee under this Deed.

Section 6.       Mortgagee to Discharge Liens.  The Shipowner authorizes and
empowers the Mortgagee or its appointees or any of them to appear in the name of
the Shipowner, its successors and assigns, in any court of any country or nation
of the world where a suit is pending against the Vessel because of or on account
of any alleged lien against the Vessel from which the Vessel has not been
released and to take such proceedings as to them or any of them may seem proper
towards the defense of such suit and the purchase or discharge of such lien, and
all expenditures made or incurred by them or any of them for the purpose of such
defense or purchase or discharge shall be a debt due from the Shipowner, its
successors and assigns, to the Mortgagee, and shall be secured by the lien of
this Deed and the Mortgage in like manner and extent as if the amount and
description thereof were written herein.

Section 7.                      Payment of Expenses.  The Shipowner covenants
that upon the happening of any one or more of the events of default, then, upon
written demand of the Mortgagee, the Shipowner will pay to the Mortgagee the
whole amount due and payable in respect of the Indebtedness hereby secured;  and
in case the Shipowner shall fail to pay the same forthwith upon such demand, the
Mortgagee shall be entitled to recover judgment for the whole amount so due and
unpaid, together with such further amounts as shall be sufficient to cover the
reasonable compensation of the Mortgagee or its agents, attorneys and counsel
and any necessary advances, expenses and liabilities made or incurred
 
 
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 by it or them or the Mortgagee hereunder.  All moneys collected by the
Mortgagee under this Section 7 shall be applied by the Mortgagee in accordance
with the provisions of Section 11 of this Article III.

Section 8.                      Remedies Cumulative.  Each and every power and
remedy herein given to the Mortgagee shall be cumulative and shall be in
addition to every other power and remedy herein given or now or hereafter
existing at law (including but not excluding all powers conferred by the
Conveyancing and Property Ordinance (Chapter 219 of the Laws of Hong Kong)), in
equity, in admiralty or by statute, and each and every power and remedy whether
herein given or otherwise existing may be exercised from time to time and as
often and in such order as may be deemed expedient by the Mortgagee, and the
exercise or the beginning of the exercise of any power or remedy shall not be
construed to be a waiver of the right to exercise at the same time or thereafter
any other power or remedy.  The Mortgagee shall not be required or bound to
enforce any of its rights under any of the other Credit Documents, prior to
enforcing its rights under this Deed and the Mortgage.  No delay or omission by
the Mortgagee in the exercise of any right or power or in the pursuance of any
remedy accruing upon any default as above defined shall impair any such right,
power or remedy or be construed to be a waiver of any such event of default or
to be an acquiescence therein;  nor shall the acceptance by the Mortgagee of any
security or of any payment of or on account of the Indebtedness hereby secured
maturing after any event of default or of any payment on account of any past
default be construed to be a waiver of any right to exercise its remedies due to
any future event of default or of any past event of default not completely cured
thereby.  No consent, waiver or approval of the Mortgagee shall be deemed to be
effective unless in writing and duly signed by authorized signatories of the
Mortgagee;  any waiver by the Mortgagee of any of the terms of this Deed or any
consent given under this Deed shall only be effective for the purpose and on the
terms which it is given and shall be without prejudice to the right to give or
withhold consent in relation to future matters (which are either the same or
different).

Section 9.                      Cure of Defaults.  If at any time after an event
of default and prior to the actual sale of the Vessel by the Mortgagee or prior
to any enforcement or foreclosure proceedings the Shipowner offers completely to
cure all events of default and to pay all expenses, advances and damages to the
Mortgagee consequent on such events of default, with interest at the interest
rate set forth in Section 1.07(b) of the Credit Agreement, then the Mortgagee
may, but shall not be obligated to, accept such offer and payment and restore
the Shipowner to its former position, but such action, if taken, shall not
affect any subsequent event of default or impair any rights consequent thereon.

Section 10.                    Discontinuance of Proceedings.  In case the
Mortgagee shall have proceeded to enforce any right, power or remedy under this
Deed and the Mortgage by foreclosure, entry or otherwise, and such proceedings
shall have been discontinued or abandoned for any reason or shall have been
determined adversely to the Mortgagee, then and in every such case the Shipowner
and the Mortgagee shall be restored to its former position and right hereunder
with respect to the property subject or intended to be subject to this Deed and
the Mortgage, and all rights, remedies and powers of the Mortgagee shall
continue as if no such proceedings had been taken.

Section 11.       Application of Proceeds.  After an event of default hereunder
shall have occurred and be continuing, the proceeds of any sale of the Vessel
and any and all other moneys received by the Mortgagee pursuant to or under the
terms of this Deed or in any proceedings hereunder, the application of which has
not elsewhere herein been specifically provided for, shall be applied as
follows:

First:                      To the payment of all costs and expenses (together
with interest thereon as set forth in Section 14 of Article II) of the
Mortgagee, including the reasonable compensation of
 
 
 
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its agents and attorneys, by reason of any sale, retaking, management or
operation of the Vessel and all other sums payable to the Mortgagee hereunder by
reason of any expenses or liabilities incurred or advances made by it for the
protection, maintenance and enforcement of the security or of any of its rights
hereunder, under the Credit Agreement, the Guaranty and under the other Credit
Documents or in the pursuit of any remedy hereby or thereby conferred;  and at
the option of the Mortgagee to the payment of any taxes, assessments or liens
claiming priority over the lien of the Mortgage; and

Second:                      To the Pledgee (as defined in the Pledge Agreement)
for its distribution in accordance with the provisions of Section 9 of the
Pledge Agreement; and

Third:                      To the Shipowner or as may be directed by a court of
competent jurisdiction.

Section 12.                                Possession Until Default.  Until one
or more of the events of default hereinafter described shall happen, the
Shipowner (a) shall be suffered and permitted to retain actual possession and
use of the Vessel and (b) shall have the right, from time to time, in its
discretion, and without application or notice to the Mortgagee, and without
obtaining a release thereof by the Mortgagee, to dispose of, free from the lien
hereof, any boilers, engines, machinery, masts, spars, sails, rigging, boats,
anchors, chains, tackle, apparel, furniture, fittings or equipment or any other
appurtenances of the Vessel that are no longer useful, necessary, profitable or
advantageous in the operation of the Vessel, first or simultaneously replacing
the same by new boilers, engines, machinery, masts, spars, sails, rigging,
boats, anchors, chains, tackle, apparel, furniture, fittings, equipment, or
other appurtenances of substantially equal value to the Shipowner, which shall
forthwith become subject to the lien of this Deed and the Mortgage.

Section 13.                                Severability of Provisions. etc.  (a)
If any provision of this Deed should be deemed invalid or shall be deemed to
affect adversely the preferred status of this Deed or the Mortgage under any
applicable law, such provision shall be void and of no effect and shall cease to
be a part of this Deed without affecting the remaining provisions, which shall
remain in full force and effect.

(b)           In the event that the Guaranty, this Deed, the Mortgage, any of
the other Credit Documents or any of the documents or instruments which may from
time to time be delivered thereunder or hereunder or any provision thereof or
hereof shall be deemed invalidated by present or future law of any nation or by
decision of any court, this shall not affect the validity and/or enforceability
of all or any other parts of the Guaranty, this Deed, the Mortgage, any of the
other Credit Documents or such documents or instruments and, in any such case,
the Shipowner covenants and agrees that, on demand, it will execute and deliver
such other and further agreements and/or documents and/or instruments and do
such things as the Mortgagee in its sole discretion may reasonably deem to be
necessary to carry out the true intent of this Deed, the Mortgage, the Guaranty
and the other Credit Documents.

(c)           In the event that the title, or ownership of the Vessel shall be
requisitioned, purchased or taken by any government of any country or any
department, agency or representative thereof, pursuant to any present or future
law, proclamation, decree order or otherwise, the lien of this Deed and the
Mortgage shall be deemed to attach to the claim for compensation therefor, and
the compensation, purchase or other taking of such title or ownership is hereby
agreed to be payable to the Mortgagee who shall be entitled to receive the same
and shall pay it to the Mortgagee who shall apply it as provided in Section 11
of this Article III.  In the event of any such requisition, purchase or taking,
and
 
 
 
 
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 the failure of the Mortgagee to receive proceeds as herein provided, the
Shipowner shall promptly execute and deliver to the Mortgagee such documents, if
any, as in the opinion of the Mortgagee may be necessary or useful to facilitate
or expedite the collection by the Mortgagee of such part of the compensation,
purchase price, reimbursement or award as is payable to it hereunder.

(d)           Anything herein to the contrary notwithstanding, it is intended
that nothing herein shall waive the priority status of this Deed and the
Mortgage, and if any provision of this Deed or portion thereof shall be
construed to waive the priority status of this Deed or the Mortgage, then such
provision to such extent shall be void and of no effect.

ARTICLE IV

Sundry Provisions

Section 1                      Successors and Assigns.  All of the covenants,
promises, stipulations and agreements of the Shipowner in this Deed contained
shall bind the Shipowner and its successors and shall inure to the benefit of
the Mortgagee and its successors and assigns.  In the event of any assignment or
transfer of this Deed, the term “Mortgagee”, as used in this Deed, shall be
deemed to mean any such assignee or transferee.

Section 2.                      Power of Substitution.  Wherever and whenever
herein any right, power or authority is granted or given to the Mortgagee, such
right, power or authority may be exercised in all cases by the Mortgagee or such
agent or agents as it may appoint, and the act or acts of such agent or agents
when taken shall constitute the act of the Mortgagee hereunder.

Section 3.                      Counterparts.  This Deed may be executed in any
number of counterparts, each of which shall be an original, but such
counterparts shall together constitute but one and the same instrument.

Section 4.                      Notices.  Except as otherwise expressly provided
herein, all notices and other communications provided for hereunder shall be in
writing (including telexed, telegraphic, telex, telecopier or cable
communication) and mailed, telexed, telecopied, cabled or delivered, if to the
Shipowner or to the Mortgagee, at its address as specified below, or at such
other address as shall be designated by such party in a written notice to the
other party:

If to the Shipowner, addressed to it in care of:

Genco Ship Management LLC
35 West 56th Street
New York, NY 10019
USA
Telephone: 646-443-8525
Facsimile:  646-443-8551
Email: finance@gencoshipping.com

If to the Mortgagee, addressed to it:

DnB Nor Bank ASA, New York Branch
200 Park Avenue, 31st Floor
 
 
 
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New York, NY 10166-0396
Attention:  Nikolai Nachamkin
Facsimile: 212-681-3900

All such notices and communications shall, (i) when mailed, be effective three
Business Days after being deposited in the mails, prepaid and properly addressed
for delivery, (ii) when sent by overnight courier, be effective one Business Day
after delivery to the overnight courier prepaid and properly addressed for
delivery on such next Business Day, or (iii) when sent by telex or telecopier,
be effective when sent by telex or telecopier, except that notices and
communications to the Mortgagee shall not be effective until received by the
Mortgagee.

Section 5.                      Statutory Mortgage.  This Deed accompanies and
is to be read with and forms part of the Mortgage dated the date hereof and
shall be effective from the date hereof.

Section 6.                      Further Assurances.  The Shipowner shall execute
and do all such assurances, acts and things as the Mortgagee, or any receiver in
its absolute discretion may require for:

(a)           perfecting or protecting the security created (or intended to be
created) by this Deed and the Mortgage; or

(b)           preserving or protecting any of the rights of the Mortgagee under
this Deed and the Mortgage (or any of them); or

(c)           ensuring that the security constituted by this Deed and the
Mortgage and the covenants and obligations of the Shipowner under this Deed
shall enure to the benefit of assignees of the Mortgagee (or any of them); or

(d)           facilitating the appropriation or realization of the Vessel or any
part thereof and enforcing the security constituted by this Deed and the
Mortgage on or at any time after the same shall have become enforceable; or

(e)           the exercise of any power, authority or discretion vested in the
Mortgagee under this Deed and the Mortgage (or any of them),

in any such case, forthwith upon demand by the Mortgagee and at the expense of
the Shipowner.

Section 7.                      Governing Law.  The provisions of this Deed
shall, with respect to its validity, effect, recordation and enforcement, be
governed by and construed in accordance with the applicable laws of Hong Kong.

Section 8.                      Additional Rights of the Mortgagee.  In the
event the Mortgagee shall be entitled to exercise any of its remedies under
Article III hereof, the Mortgagee shall have the right to arrest and take action
against the Vessel at whatever place the Vessel shall be found lying and for the
purpose of any action which the Mortgagee may bring before the Courts of such
jurisdiction or other judicial authority and for the purpose of any action which
the Mortgagee may bring against the Vessel, any writ, notice, judgment or other
legal process or documents may (without prejudice to any other method of service
under applicable law) be served upon the Master of the Vessel (or upon anyone
acting as the Master) and such service shall be deemed good service on the
Shipowner for all purposes.
 
 
 
20

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[THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK]
 
 
 
 
 
 
 
 

21

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IN WITNESS WHEREOF, the Shipowner has caused this Deed of Covenants to be duly
executed by its authorized representative the day and year first above written.

SIGNED, SEALED and DELIVERED by
[                                                ]
for and on behalf of
[NAME OF SHIPOWNER]

DNB NOR BANK ASA, NEW YORK BRANCH,
as Security Trustee,

By:  ____________________
Name:
Title:

22

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Exhibit L-1
 
 
HONG   KONG   SHIP   MORTGAGE
[Missing Graphic Reference]
Entered into pursuant to section 44 of the Merchant Shipping (Registration)
Ordinance
[Missing Graphic Reference]
 
_______________________
 
BY THIS MORTGAGE the Mortgagor referred to in Part ONE Mortgages the Ship
referred to in Part TWO to the Mortgagee referred to in Part THREE as security
for the due and punctual performance of all the Mortgagor's obligations to the
Mortgagee pursuant to the [document] [transaction] referred to in Part FOUR as
such [document] [transaction] may from time to time hereafter be amended
modified and supplemented.
[Missing Graphic Reference]

By its execution of this mortgage the Mortgagor warrants to the Mortgagee that
(a) it has power to enter into this mortgage (b) the said ship is free of
incumbrances save for any shown in the Hong Kong Register of Ships at the time
this mortgage is presented for recording and (c) this mortgage is binding on and
enures for the benefit of the successors and assigns of the Mortgagor and
Mortgagee. [The Mortgagor further warrants that the Mortgagee's representative
has authority to insert the official number of the Ship upon such number being
designated to the Ship.]
[Missing Graphic Reference]

P A R T   O N E
M O R T G A G O R  (Ship's owner)
 
[Missing Graphic Reference]
[Missing Graphic Reference]
 
[Missing Graphic Reference]
[Missing Graphic Reference]
 
 
 
[SHIPOWNER]
 
Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall Islands
MH96960
Incorporated in the Republic of Marshall islands
Registered in Hong Kong as an oversea company under Part XI of the Companies
Ordinance (Cap.32 of the Laws of Hong Kong) having an address at 15th Floor,
Tower One, Lippo Centre, 89 Queensway, Hong Kong
 

P A R T   T W O
SHORT  DESCRIPTION  OF  MORTGAGED  SHIP
 
[Missing Graphic Reference]
[Missing Graphic Reference]
 
[Missing Graphic Reference]
[Missing Graphic Reference]
HK-[    ]
[VESSEL]
      [Missing Graphic Reference]

P A R T   T H R E E
M O R T G A G E E  (see Note 3)
 
[Missing Graphic Reference]
[Missing Graphic Reference]
 
[Missing Graphic Reference]
[Missing Graphic Reference]
 
 
 
     DNB NOR BANK ASA, NEW YORK BRANCH
 
 
 
200 Park Avenue
New York
New York 10166-0396
(incorporated under the laws of the Kingdom of Norway)
 
 
[Missing Graphic Reference]
212-681-3863
[Missing Graphic Reference]
 212-681-3900

P A R T   F O U R
Particulars of Document[s] or transaction[s], the obligations whereunder are
secured by this mortgagee (see note 4)
 
[Missing Graphic Reference]
[Missing Graphic Reference]
 
Date and Nature of Transaction and Description of Document (if any)
[Missing Graphic Reference]
[Missing Graphic Reference]
1.           Credit Agreement dated __ July 2007
2.           Deed of Covenants dated [                    ] 2007
3.           Guaranty dated [                     ] 2007
4.Certain Letters of Credit issued from time to time for the account of Genco
Shipping & Trading Limited
5.           The other Security Documents as defined and described in Section
13.01 of
the above Credit Agreement to which the Mortgagor is a party
1.  (a) Genco Shipping & Trading Limited as borrower (b) the banks and financial
institutions named therein as lenders (c) the Mortgagee, as administrative
agent, mandated lead arranger, bookrunner and collateral agent
2.        (a) the Mortgagor, as shipowner and (b) the Mortgagee, as
administrative agent
3.        (a) the Mortgagor and others, as guarantor and (b) the Mortgagee, as
administrative agent
4.        (a) any lenders under the Credit Agreement, as issuing lender

IN WITNESS whereof the Mortgagor has caused this mortgage to be executed on
                 2007
[Missing Graphic Reference]

 
SIGNED, SEALED and DELIVERED
by                                                                                  )
[                                        ]                      )
for and on behalf
of                                                                            )
[SHIPOWNER]                             )
as its duly authorised
attorney                                                                                  )
pursuant to a power of
attorney                                                                                  )
dated                                                  2007                      )
in the presence
of:                                                                       )
 
 
 

N O T E S
[Missing Graphic Reference]

--------------------------------------------------------------------------------

EXHIBIT L-2
TO THE CREDIT AGREEMENT

FORM OF
FIRST PREFERRED SHIP MORTGAGE

ON MARSHALL ISLANDS FLAG VESSEL

[VESSEL]
OFFICIAL NO. [OFFICIAL NUMBER]

executed by

[SHIPOWNER],
as Shipowner

in favor of

DNB NOR BANK ASA, NEW YORK BRANCH
as Security Trustee and Mortgagee

[CLOSING DATE]

--------------------------------------------------------------------------------

 
TABLE OF CONTENTS
                                              
                                                                  Page
ARTICLE I [INSERT PAGE NUMBER]
Section 1.                      Existence;
Authorization                                                       4
Section 2.                      Title to
Vessel                                                             4
Section 3.                      ISM, ISPS and MARPOL
Compliance                                                4
ARTICLE
II                                                                               
4
Section 1.                      Payment of
Indebtedness                                                        4
Section 2.                      Mortgage
Recording                                                         5
Section 3.                      Lawful
Operation                                                           5
Section 4.                      Payment of
Taxes                                                          5
Section 5.                      Prohibition of
Liens                                                          5
Section 6.                      Notice of
Mortgage                                                          5
Section 7.                      Removal of
Liens                                                          6
Section 8.                      Release from
Arrest                                                          6
Section
9.                      Maintenance                                                             6
        Section 10.                    Inspection;
Reports                                                         9
        Section 11.        Flag; Home
Port                                                            9
Section 12.                    No Sales. Transfers or
Charters                                               10
Section
13.                    Insurance                                                             10
Section 14.                    Reimbursement for
Expenses                                                    13
Section 15.                    Performance of
Charters                                                     14
Section 16.                    Change in
Ownership                                                         14
Section 17.                    Prepayment if Event of
Loss                                                 14
ARTICLE
III                                                                           
14
Section 1.                      Events of Default:
Remedies                                                     14
Section 3.                      Power of
Attorney-Sale                                                     17
Section 4.                      Power of
Attorney-Collection                                                  17
Section 5.                      Delivery of
Vessel                                                          17
Section 6.                      Mortgagee to Discharge
Liens                                                17
Section 7.                      Payment of
Expenses                                                    18
Section 8.                      Remedies
Cumulative                                                        18
Section 9.                      Cure of
Defaults                                                         18
Section 10.                    Discontinuance of
Proceedings                                               18
Section 11.                    Application of
Proceeds                                                    19
Section 12.                    Possession Until
Default                                                   19
Section 13.                    Severability of Provisions.
etc                                                  19
ARTICLE
IV                                                                            20
Section 1                      Successors and
Assigns                                                    20
Section 2.                      Power of
Substitution                                                        20
Section
3.                      Counterparts                                                           20
Section
4.                      Notices                                                             20
Section 5.                     Recording:
Clause                                                          21
Section 6.                     Further
Assurances                                                        21
Section 7.                      Governing
Law                                                           22
Section 8.                      Additional Rights of the
Mortgagee                                              22

 
 

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FIRST PREFERRED MORTGAGE

[VESSEL]

This First Preferred Ship Mortgage made [CLOSING DATE] (this “Mortgage”), by
[SHIPOWNER], a Marshall Islands limited liability company (the “Shipowner”), in
favor of DNB NOR BANK ASA, NEW YORK BRANCH, a bank incorporated under the laws
of the Kingdom of Norway, acting through its New York branch, with offices at
200 Park Avenue, New York, New York 10166-0396 as Security Trustee (together
with its successors in trust and assigns, the “Mortgagee”), pursuant to the
Credit Agreement referred to below.

W I T N E S S E T H

WHEREAS:

A.           The Shipowner is the sole owner of the whole of the Marshall
Islands flag vessel [VESSEL NAME], Official Number [OFFICIAL NUMBER] of [GROSS
TONS] gross tons and [NET TONS] net tons built in [YEAR BUILT] at [YARD AND
LOCATION BUILT], with her home port at Majuro, Marshall Islands.

B.           Genco Shipping & Trading Limited, a Marshall Islands corporation
(the “Borrower”), the Lenders party thereto from time to time, the Mortgagee, as
mandated lead arranger, book runner, Administrative Agent and Collateral Agent,
have entered into a Credit Agreement dated as of July __ 2007 (as the same may
be amended, supplemented or otherwise modified from time to time, the “Credit
Agreement”), providing for the making of revolving loans to the Borrower in the
principal amount of up to One Billion Three Hundred Seventy Seven Million United
States Dollars (U.S.$1,377,000,000) (the "Loan") (the Lenders, the
Administrative Agent and Collateral Agent, collectively, the “Lender
Creditors”).  A copy of the form of the Credit Agreement (without attachments)
is attached hereto as Exhibit A and made a part hereof.  A copy of the Note is
attached hereto as Exhibit B and made a part hereof.  Except as otherwise
defined herein, capitalized terms used herein and defined in the Credit
Agreement shall be used herein as so defined.

C.           The Borrower may at any time and from time to time enter into, or
guaranty the obligations of one or more Subsidiary Guarantors or any of their
respective Subsidiaries under, one or more Interest Rate Protection Agreements
or Other Hedging Agreements with respect to the Loan (and/or the Commitments)
with one or more Lenders or any Affiliate thereof (each such Lender or
Affiliate, even if the respective Lender subsequently ceases to be a Lender
under the Credit Agreement for any reason, together with such Lender’s or
Affiliate’s successors and assigns, if any, collectively, the “Other Creditors”
and, together with the Lender Creditors, the “Secured Creditors”).  The
estimated aggregate notional amount of the liabilities of the Borrower under the
Interest Rate Protection Agreements or Other Hedging Agreements entered into
with respect to the Loan (and/or the Commitments) is [         ] United States
Dollars (U.S.$[       ]) (the "Hedging Liabilities").

D.           The Shipowner is a wholly-owned subsidiary of the Borrower.
 
 
 

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E.           The Shipowner entered into the Guaranty in favor of the Secured
Creditors pursuant to which the Shipowner has guaranteed (i) to the Lender
Creditors, all obligations of the Borrower under the Credit Agreement and each
other Credit Document to which the Borrower is a party, and (ii) to each of the
Other Creditors, all obligations of the Borrower under each Interest Rate
Protection Agreement and each Other Hedging Agreement entered into with respect
to the Loan (and/or the Commitments).  A copy of the form of the Guaranty is
attached hereto as Exhibit C and made a part hereof.  The Lenders have advanced
the Loan pursuant to the Credit Agreement;  the Shipowner acknowledges that it
is justly indebted to the Secured Creditors under the Guaranty.

F.           In order to secure its obligations under the Guaranty according to
the terms thereof, and the payment of all other such sums that may hereinafter
be secured by this Mortgage in accordance with the terms hereof, and to secure
the performance and observance of and compliance with all the agreements,
covenants and conditions contained herein and in the Guaranty, the Shipowner has
duly authorized the execution and delivery of this First Preferred Mortgage
under Chapter 3 of the Marshall Islands Maritime Act 1990 as amended.

G.           Pursuant to the Credit Agreement, the Mortgagee has agreed to act
as Trustee for the Secured Creditors.

NOW, THEREFORE, in consideration of the premises and other good and valuable
consideration, and in order to secure the Shipowner’s obligations under the
Guaranty according to the terms thereof, and the payment of all other sums that
may hereafter be secured by this Mortgage in accordance with the terms hereof
(all such obligations and other sums hereinafter called the “Indebtedness hereby
secured”) and to secure the performance and observance of and compliance with
all of the agreements, covenants and conditions contained in this Mortgage and
the Guaranty, the Shipowner has granted, conveyed, mortgaged, pledged,
confirmed, assigned, transferred and set over and by these presents does grant,
convey, mortgage, pledge, confirm, assign, transfer and set over, unto the
Mortgagee, and its successors and assigns, the whole of the said vessel [VESSEL
NAME], including, without being limited to, all of the boilers, engines,
machinery, masts, spars, boats, anchors, cables, chains, fuel (to the extent
owned by the Shipowner), rigging, tackle, capstans, outfit, tools, pumps and
pumping equipment, apparel, furniture, drilling equipment, fittings, equipment,
spare parts, and all other appurtenances thereunto appertaining or belonging,
whether now owned or hereafter acquired, and also any and all additions,
improvements, renewals and replacements hereafter made in or to such vessel or
any part thereof, including all items and appurtenances aforesaid (such vessel,
together with all of the foregoing, being herein called the “Vessel”).

TO HAVE AND TO HOLD all and singular the above mortgaged and described property
unto the Mortgagee and its successors and assigns, to its and to its successors’
and assigns’ own use, benefit and behoof forever.

PROVIDED, and these presents are upon the condition, that, if the Shipowner or
its successors or assigns shall pay or cause to be paid the Indebtedness hereby
secured as and when the same shall become due and payable in accordance with the
terms of the Guaranty and this Mortgage, and all other such sums as may
hereafter become secured by this Mortgage in accordance with the terms hereof,
and the Shipowner shall duly perform, observe and comply with or cause to be
performed, observed, or complied with all the covenants, terms and conditions of
this Mortgage and the Guaranty expressed or implied, to be performed, then this
Mortgage and the estate and rights hereunder shall cease, determine and be void,
otherwise to remain in full force and effect.
 
 
3

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The Shipowner, for itself, its successors and assigns, hereby covenants,
declares and agrees with the Mortgagee and its successors and assigns that the
Vessel is to be held subject to the further covenants, conditions, terms and
uses hereinafter set forth.

The Shipowner covenants and agrees with the Mortgagee as follows:

ARTICLE I

Representations and Warranties of the Shipowner

Section 1.                      Existence: Authorization.  The Shipowner is a
company duly organized and validly existing under the laws of the Republic of
the Marshall Islands and shall so remain during the life of this Mortgage.  The
Shipowner has full power and authority to own and mortgage the Vessel; has full
right and entitlement to register the Vessel in its name under the flag of the
Republic of the Marshall Islands and all action necessary and required by law
for the execution and delivery of this Mortgage has been duly and effectively
taken; and each of the Indebtedness hereby secured and this Mortgage is and will
be the legal, valid and binding obligation of the Shipowner enforceable in
accordance with its terms.

Section 2.                      Title to Vessel.  The Shipowner lawfully owns
and is lawfully possessed of the Vessel free from any lien or encumbrance
whatsoever other than this Mortgage, liens for current crew’s wages and liens
not yet required to be removed under Section 7 of Article II hereof and will
warrant and defend the title and possession thereto and to every part thereof
for the benefit of the Mortgagee against the claims and demands of all persons
whomsoever.

Section 3.                      ISM, ISPS and MARPOL Compliance.  The Shipowner
has obtained all necessary ISM Documentation in connection with the Vessel and
is in full compliance with the ISM Code, the ISPS Code and Annex VI (Regulations
for the Prevention of Air Pollution from Ships) to MARPOL (as such terms are
defined in Section 9 of Article II.

ARTICLE II

Covenants of the Shipowner

Section 1.                      Payment of Indebtedness.  The Shipowner will pay
or cause to be paid the Indebtedness hereby secured and will observe, perform
and comply with the covenants, terms and conditions herein and in the Guaranty,
express or implied, on its part to be observed, performed or complied with. In
the event of inconsistency between this Mortgage and the Guaranty, the
provisions of this Mortgage shall prevail but only to the extent required by
Marshall Islands law.

The obligation of the Indebtedness hereby secured is an obligation in United
States Dollars and the term “US$” when used herein shall mean such United States
Dollars.  Notwithstanding fluctuations in the value or rate of United States
Dollars in terms of gold or any other currency, all payments hereunder or
otherwise in respect of the Indebtedness hereby secured shall be payable in
terms of United States Dollars when due, in United States Dollars when paid,
whether such payment is made before or after the due date.
 
 
4

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Section 2.                      Mortgage Recording.  The Shipowner will cause
this Mortgage to be duly recorded or filed in the Office of the Deputy
Commissioner of Maritime Affairs of the Republic of the Marshall Islands, in
accordance with the provisions of Chapter 3 of the Republic of the Marshall
Islands Maritime Act of 1990, as amended, and will otherwise comply with and
satisfy all of the provisions of applicable laws of the Republic of the Marshall
Islands in order to establish and maintain this Mortgage as a first preferred
mortgage thereunder upon the Vessel and upon all renewals, replacements and
improvements made in or to the same for the amount of the Indebtedness hereby
secured.

Section 3.                      Lawful Operation.  The Shipowner will not cause
or permit the Vessel to be operated in any manner contrary to law, and the
Shipowner will not engage in any unlawful trade or violate any law or carry any
cargo that will expose the Vessel to penalty, forfeiture or capture, and will
not do, or suffer or permit to be done, anything which can or may injuriously
affect the registration of the Vessel under the laws and regulations of the
Republic of the Marshall Islands and will at all times keep the Vessel duly
documented thereunder.

Section 4.                      Payment of Taxes.  The Shipowner will pay and
discharge when due and payable, from time to time, all taxes, assessments,
governmental charges, fines and penalties lawfully imposed on the Vessel or any
income therefrom.

Section 5.                      Prohibition of Liens.  Neither the Shipowner,
any charterer, the Master of the Vessel nor any other person has or shall have
any right, power or authority to create, incur or permit to be placed or imposed
or continued upon the Vessel, its freights, profits or hire any lien whatsoever
other than this Mortgage, other liens in favor of the Mortgagee and for crew’s
wages and salvage.

Section 6.                      Notice of Mortgage.  The Shipowner will place,
and at all times and places will retain a properly certified copy of this
Mortgage on board the Vessel with her papers and will cause such certified copy
and the Vessel’s marine document to be exhibited to any and all persons having
business therewith which might give rise to any lien thereon other than liens
for crew’s wages and salvage, and to any representative of the Mortgagee.

The Shipowner will place and keep prominently displayed in the chart room and in
the Master’s cabin on the Vessel a framed printed notice in plain type reading
as follows:

NOTICE OF MORTGAGE

THIS VESSEL IS OWNED BY [SHIPOWNER], AND IS SUBJECT TO A FIRST PREFERRED
MORTGAGE IN FAVOR OF DNB NOR BANK ASA, NEW YORK BRANCH, AS TRUSTEE/MORTGAGEE
UNDER AUTHORITY OF CHAPTER 3 OF THE MARSHALL ISLANDS MARITIME ACT 1990, AS
AMENDED.  UNDER THE TERMS OF SAID MORTGAGE, NEITHER THE SHIPOWNER, ANY
CHARTERER, THE MASTER OF THE VESSEL, NOR ANY OTHER PERSON HAS ANY RIGHT, POWER
OR AUTHORITY TO CREATE, INCUR OR PERMIT TO BE PLACED OR IMPOSED UPON THE VESSEL,
ANY ENCUMBRANCES WHATSOEVER OR ANY OTHER LIEN WHATSOEVER OTHER THAN FOR CREW’S
WAGES AND SALVAGE.
 
 
5

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Section 7.                      Removal of Liens.  Except for the lien of this
Mortgage, the Shipowner will not suffer to be continued any lien, encumbrance or
charge on the Vessel, and in due course and in any event within thirty (30) days
after the same becomes due and payable or within fourteen (14) days after being
requested to do so by the Mortgagee, the Shipowner will pay or cause to be
discharged or make adequate provision for the satisfaction or discharge of all
claims or demands, and will cause the Vessel to be released or discharged from
any lien, encumbrance or charge therefor.

Section 8.                      Release from Arrest.  If a libel, complaint or
similar process be filed against the Vessel or the Vessel be otherwise attached,
levied upon or taken into custody by virtue of any legal proceeding in any
court, the Shipowner will promptly notify the Mortgagee thereof by telex, or
telefax confirmed by letter, at the address, as specified in this Mortgage, and
within fourteen (14) days will cause the Vessel to be released and all liens
thereon other than this Mortgage to be discharged, will cause a certificate of
discharge to be recorded in the case of any recording of a notice of claim of
lien, and will promptly notify the Mortgagee thereof in the manner
aforesaid.  The Shipowner will notify the Mortgagee within forty-eight (48)
hours of any average or salvage incurred by the Vessel.

Section 9.                      Maintenance.  (a) The Shipowner will at all
times and without cost or expense to the Mortgagee maintain and preserve, or
cause to be maintained and preserved, the Vessel and all its equipment, outfit
and appurtenances, tight, staunch, strong, in good condition, working order and
repair and in all respects seaworthy and fit for its intended service, and will
keep the Vessel, or cause her to be kept, in such condition as will entitle her
to the highest classification and rating for vessels of the same age and type in
the American Bureau of Shipping or other classification society listed on
Schedule VIII to the Credit Agreement.  The Shipowner covenants to deliver
annually to the Mortgagee a certificate from such class society showing such
classification to be maintained.  The Shipowner will without cost or expense to
the Mortgagee promptly, irrevocably and unconditionally instruct and authorize
the classification society of the Vessel, and shall request the classification
society to give an undertaking to the Mortgagee as follows:

1.           to send to the Mortgagee, following receipt of a written request
from the Mortgagee, certified true copies of all original class records held by
the classification society relating to the Vessel;

2.           to allow the Mortgagee (or its agents), at any time and from time
to time, to inspect the original class and related records of the Shipowner and
the Vessel at the offices of the classification society and to take copies of
them;

3.           following receipt of a written request from the Mortgagee:

(a)           to advise of any facts or matters which may result in or have
resulted in a change, suspension, discontinuance, withdrawal or expiry of the
Vessel’s class under the rules or terms and conditions of the Shipowner’s or the
Vessel’s membership of the classification society; and

(b)           to confirm that the Shipowner is not in default of any of its
contractual obligations or liabilities to the classification society and,
without limiting the foregoing, that it has paid in full all fees or other
charges due and payable to the classification society; and
 
 
6

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(c)           if the Shipowner is in default of any of its contractual
obligations or liabilities to the classification society, to specify to the
Mortgagee in reasonable detail the facts and circumstances of such default, the
consequences thereof, and any remedy period agreed or allowed by the
classification society; and

(d)           to notify the Mortgagee immediately in writing if the
classification society receives notification from the Shipowner or any other
person that the Vessel’s classification society is to be changed.

Notwithstanding the above instructions and undertaking given for the benefit of
the Mortgagee, the Shipowner shall continue to be responsible to the
classification society for the performance and discharge of all its obligations
and liabilities relating to or arising out of or in connection with the contract
it has with the classification society, and nothing herein or therein shall be
construed as imposing any obligation or liability of the Mortgagee to the
classification society in respect thereof.

The Shipowner shall further notify the classification society that all the
foregoing instructions and authorizations shall remain in full force and effect
until revoked or modified by written notice to the classification society
received from the Mortgagee, and that the Shipowner shall reimburse the
classification society for all its costs and expenses incurred in complying with
the foregoing instructions.

(b)           The Vessel shall, and the Shipowner covenants that she will, at
all times comply with all applicable laws, treaties and conventions to which the
Republic of the Marshall Islands is a party, and rules and regulations issued
thereunder, and shall have on board as and when required thereby valid
certificates showing compliance therewith.  The Shipowner will not make, or
permit to be made, any substantial change in the structure, type or speed of the
Vessel or change in her rig, without first receiving the written approval
thereof by the Mortgagee.

(c)           The Shipowner agrees to give the Mortgagee at least ten (10) days
notice of the actual date and place of any survey or drydocking, in order that
the Mortgagee may have representatives present if desired.  The Shipowner agrees
that at the Mortgagee’s request it will satisfy the Mortgagee that the expense
of such survey or drydocking or work to be done thereat is within Shipowner’s
financial capability and will not result in a claim or lien against the Vessel
in violation of the provisions of this Mortgage, the Credit Agreement, the
Guaranty or any other Credit Document.

(d)           The Shipowner shall promptly notify the Mortgagee of and furnish
the Mortgagee with full information, including copies of reports and surveys,
regarding any material accident or accident involving repairs where the
aggregate cost is likely to exceed Two Million Five Hundred Thousand Dollars
(U.S. $2,500,000) (or its equivalent in another currency), any major damage to
the Vessel, any event affecting the Vessel’s class, any occurrence in
consequence whereof the Vessel has become or is likely to suffer an Event of
Loss.

(e)           The Mortgagee shall have the right at any time, on reasonable
notice, to have its surveyor conduct inspections and surveys of the Vessel to
ascertain the condition of the Vessel and to satisfy itself that the Vessel is
being properly repaired and maintained.  Such inspections and surveys shall be
conducted at such times and in such manner as will not interfere with the
Shipowner’s normal business operations and schedule.
 
 
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(f)           The Shipowner will furnish to the Mortgagee on demand true and
complete copies of the DOC (the SMC referred to in the definition of ISM Code
Documentation below) and such other ISM Code documentation as the Mortgagee may
reasonably request in writing.

(g)           The Shipowner will comply or procure compliance with the ISM Code,
the ISPS Code and Annex VI (Regulations for the Prevention of Air Pollution from
Ships) to MARPOL (as such terms are defined below) and notify the Mortgagee
forthwith upon:

(i)           any claim for breach of the ISM Code or the ISPS Code being made
against the Shipowner, an ISM Responsible Person (as such term is defined below)
or the manager of the Vessel in connection with the Vessel; or

(ii)           any other matter, event or incident, actual or which will or
could lead to the ISM Code or the ISPS Code or Annex VI (Regulations for the
Prevention of Air Pollution from Ships) to MARPOL not being complied with;

and keep the Mortgagee advised in writing on a regular basis and in such detail
as the Mortgagee shall require, of the Shipowner’s and Vessel manager’s response
to the items referred to in subclauses (i) and (ii) above.

For the purposes of this Mortgage:

“ISM Code” means in relation to its application the Shipowner, the Vessel and
its operation:

(a)           ‘The International Management Code for the Safe Operation of Ships
and for Pollution Prevention’, currently known or referred to as the ‘ISM Code’,
adopted by the Assembly of the International Maritime Organization by Resolution
A.741(18) on 4 November 1993 and incorporated on 19 May 1994 into Chapter IX of
the International Convention for the Safety of Life at Sea 1974 (SOLAS 1974);
and

(b)           all further resolutions, circulars, codes, guidelines, regulations
and recommendations which are now or in the future issued by or on behalf of the
International Maritime Organization or any other entity with responsibility for
implementing the ISM Code, including without limitation, the ‘Guidelines on
implementation or administering of the International Safety Management (ISM)
Code by Administrations’ produced by the International Maritime Organization
pursuant to Resolution A.788(19) adopted on 25 November 1995,

as the same may be amended, supplemented or replaced from time to time;

“ISM Code Documentation” includes:

(a)           the document of compliance (DOC) and safety management certificate
(SMC) issued pursuant to the ISM Code in relation to the Vessel within the
periods specified by the ISM Code;
 
 
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(b)           the interim safety management certificate (“Interim SMC”) issued
pursuant to the ISM Code in relation to the Vessel prior to or on the delivery
date thereof;

(c)           all other documents and data which are relevant to the ISM SMS and
its implementation and verification which the mortgage may require by request;
and

(d)           any other documents which are prepared or which are otherwise
relevant to establish and maintain the Vessel’s or the Shipowner’s compliance
with the ISM Code which the Mortgagee may require by request.

“ISM SMS” means the safety management system which is required to be developed,
implemented and maintained under the ISM Code.

“ISPS Code” means the International Ship and Port Facility Security Code
constituted pursuant to resolution A.924(22) of the International Maritime
Organisation (“IMO”) adopted by a Diplomatic conference of the IMO on Maritime
Security on 13 December 2002 and now set out in Chapter XI-2 of the Safety of
Life at Sea Convention (SOLAS) 1974 (as amended) adopted on July 1, 2004.

"MARPOL" means the International Convention for the Prevention of Pollution from
Ships 1973 (as modified in 1978 and 1997) and includes any amendments or
extensions of it and any regulation issued pursuant to it.

Section 10.                                Inspection; Reports.  (a)  The
Shipowner will at all reasonable times afford the Mortgagee or its authorized
representatives full and complete access to the Vessel for the purpose of
inspecting the Vessel and her cargo and papers, including without limitation all
records pertaining to the Vessel’s maintenance and repair, and, at the request
of the Mortgagee, the Shipowner will deliver for inspection copies of any and
all contracts and documents relating to the Vessel, whether on board or not.

(b)           The Shipowner hereby agrees to furnish promptly to the Mortgagee,
on demand, any reports or information which the Shipowner may submit to
shareholders or regulatory agencies and any additional information which the
Mortgagee may request in respect of the financial condition of the Shipowner.

Section 11.                                Flag; Home Port.  (a)  The Shipowner
will not change the flag or home port of the Vessel without the written consent
of the Mortgagee and any such written consent to anyone change of flag or home
port shall not be construed to be a waiver of this provision with respect to any
subsequent proposed change of flag or home port.

(b)           Notwithstanding the foregoing provisions of this Section 11, upon
not less than 30 days prior written notice to the Mortgagee, provided no Default
or Event of Default under the Credit Agreement shall have occurred and be
continuing, the Shipowner may change the flag or home port of the Vessel to
another flag or home port reasonably satisfactory to the Mortgagee, provided
that the Shipowner shall promptly take all actions necessary or desirable to
establish, preserve, protect and maintain the security interest of the Mortgagee
in the Vessel to the satisfaction of the Mortgagee, and the Shipowner shall have
provided to the Mortgagee and the Lenders such opinions of counsel as may
 
 
 
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be reasonably requested by the Mortgagee to assure itself that the conditions of
this proviso have been satisfied.

Section 12.                                No Sales, Transfers or Charters.  The
Shipowner will not sell, mortgage, transfer, or change the management of, or
demise charter the Vessel for any period longer than twelve (12) months
(including any permitted extensions or renewals) in each case, without the
written consent of the Mortgagee (not to be unreasonably withheld) first had and
obtained, and any such written consent to any one sale, mortgage, demise
charter, transfer, or change of management shall not be construed to be a waiver
of this provision with respect to any subsequent proposed sale, mortgage, demise
charter, transfer, or change of management.  Any such sale, mortgage, demise
charter, transfer, or change of management of the Vessel shall be subject to the
provisions of this Mortgage and the lien hereof.

Section 13.                                Insurance.  (a)  The Shipowner, at
its own expense, or with respect to part (a)(iii) of this Section 13 the
Mortgagee at the expense of the Shipowner, will keep the Vessel insured with
insurers and protection and indemnity clubs or associations of internationally
recognized responsibility, and placed in such markets, on such terms and
conditions, and through brokers, in each case reasonably satisfactory to the
Mortgagee and under forms of policies approved by the Mortgagee against the
risks indicated below and such other risks as the Mortgagee may specify from
time to time:

(i)           Marine and war risk, including London Blocking and Trapping
Addendum and Lost Vessel Clause, hull and machinery insurance in an amount in
U.S. dollars equal to, except as otherwise approved or required in writing by
the Mortgagee, the greater of (x) the then full commercial value of the Vessel
or (y) an amount which, when aggregated with such insured value of the other
Mortgaged Vessels (if the other Mortgaged Vessels are then subject to a mortgage
in favor of the Mortgagee under the Credit Agreement, and have not suffered an
Event of Loss), is equal to [120]% of the then outstanding aggregate principal
amount of the Loan whether used or unused.

(ii)           Marine and war risk protection and indemnity insurance or
equivalent insurance (including coverage against liability for passengers, fines
and penalties arising out of the operation of the Vessel, insurance against
liability arising out of pollution, spillage or leakage, and workmen’s
compensation or longshoremen’s and harbor workers’ insurance as shall be
required by applicable law) in such amounts approved by the
Mortgagee;  provided, however that insurance against liability under law or
international convention arising out of pollution, spillage or leakage shall be
in an amount not less than the greater of:

(y)           the maximum amount available, as that amount may from time to time
change, from the International Group of Protection and Indemnity Associations or
alternatively such sources of pollution, spillage or leakage coverage as are
commercially available in any absence of such coverage by the International
Group as shall be carried by prudent shipowners for similar vessels engaged in
similar trades plus amounts available from customary excess insurers of such
risks as excess amounts shall be carried by prudent shipowners for similar
vessels engaged in similar trades; and

(z)           the amounts required by the laws or regulations of the United
States of America or any applicable jurisdiction in which the Vessel may be
trading from time to time.
 
 
 
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(iii)           While the Vessel is idle or laid up, at the option of the
Shipowner and in lieu of the above-mentioned marine and war risk hull insurance,
port risk insurance insuring the Vessel against the usual risks encountered by
like vessels under similar circumstances.

(b)           The marine and commercial war-risk insurance required by this
Section 13 shall have deductibles and franchises not exceeding those that a
reasonable prudent owner would agree for a vessel of the type, age and condition
of the Vessel.

All insurance maintained hereunder shall be primary insurance without right of
contribution against any other insurance maintained by the Mortgagee.  Each
policy of marine and war risk hull and machinery insurance with respect to the
Vessel shall provide that the Mortgagee shall be a named insured and a loss
payee.  Each entry in a marine and war risk protection indemnity club with
respect to the Vessel shall note the interest of the Mortgagee.  The Mortgagee
and its successors and assigns shall not be responsible for any premiums, club
calls, assessments or any other obligations or for the representations and
warranties made therein by the Shipowner or any other person.

(c)           The Shipowner will furnish the Mortgagee from time to time on
request, and in any event at least annually, a detailed report signed by a firm
of marine insurance brokers acceptable to the Mortgagee with respect to P & I
entry, the hull and machinery and war risk insurance carried and maintained on
the Vessel, together with their opinion as to the adequacy thereof and its
compliance with the provisions of this Mortgage.  At the Shipowner’s expense the
Shipowner will cause such insurance broker and the P & I club or association
providing P & I insurance referred to in part (a)(ii) of this Section 13, to
agree to advise the Mortgagee by telex or telecopier confirmed by letter of any
expiration, termination, alteration or cancellation of any policy, any default
in the payment of any premium and of any other act or omission on the part of
the Shipowner of which it has knowledge and which might invalidate or render
unenforceable, in whole or in part, any insurance on the Vessel, and to provide
an opportunity of paying any such unpaid premium or call, such right being
exercisable by the Mortgagee on a vessel by vessel and not on a fleet basis.  In
addition, the Shipowner shall promptly provide the Mortgagee with any
information which the Mortgagee reasonably requests for the purpose of obtaining
or preparing any report from an independent marine insurance consultant as to
the adequacy of the insurances effected or proposed to be effected in accordance
with this Mortgage as of the date hereof or in connection with any renewal
thereof, and the Shipowner shall upon demand indemnify the Mortgagee in respect
of all reasonable fees and other expenses incurred by or for the account of the
Mortgagee in connection with any such report;  provided the Mortgagee shall be
entitled to such indemnity only for one such report during any period of twelve
months.

The underwriters or brokers shall furnish the Mortgagee with a letter or letters
of undertaking to the effect that:

(i)           they will hold the instruments of insurance, and the benefit of
the insurances thereunder, to the order of the Mortgagee in accordance with the
terms of the loss payable clause referred to in the relevant Assignment of
Insurances for the Vessel; and

(ii)           they will have endorsed on each and every policy as and when the
same is issued the loss payable clause and the notice of assignment referred to
in the relevant Assignment of Insurances for the Vessel; and
 
 
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(iii)           they will not set off against any sum recoverable in respect of
a claim against the Vessel under the said underwriters or brokers or any other
person in respect of any other vessel nor cancel the said insurances by reason
of non-payment of such premiums or other amounts.

All policies of insurance required hereby shall provide for not less than 14
days prior written notice to be received by the Mortgagee of the termination or
cancellation of the insurance evidenced thereby.  All policies of insurance
maintained pursuant to this Section 13 for risks covered by insurance other than
that provided by a P & I Club shall contain provisions waiving underwriters’
rights of subrogation thereunder against any assured named in such policy and
any assignee of said assured.  The Shipowner has assigned to the Mortgagee its
rights under any policies of insurance in respect of the Vessel.  The Shipowner
agrees that, unless the insurances by their terms provide that they cannot cease
(by reason of nonrenewal or otherwise) without the Mortgagee being informed and
having the right to continue the insurance by paying any premiums not paid by
the Shipowner, receipts showing payment of premiums for required insurance and
also of demands from the Vessel’s P & I underwriters shall be in the hands of
the Mortgagee at least two (2) days before the risk in question commences.

(d)           Unless the Mortgagee shall otherwise agree, all amounts of
whatsoever nature payable under any insurance must be payable to the Mortgagee
for distribution first to itself and thereafter to the Shipowner or others as
their interests may appear.  Nevertheless, until otherwise required by the
Mortgagee by notice to the underwriters upon the occurrence and continuance of a
Default or an event of default hereunder, (i) amounts payable under any
insurance on the Vessel with respect to protection and indemnity risks may be
paid directly to the Shipowner to reimburse it for any loss, damage or expense
incurred by it and covered by such insurance or to the person to whom any
liability covered by such insurance has been incurred provided that the
underwriter shall have first received evidence that the liability insured
against has been discharged, and (ii) amounts payable under any insurance with
respect to the Vessel involving any damage to the Vessel not constituting an
Event of Loss, may be paid by underwriters directly for the repair, salvage or
other charges involved or, if the Shipowner shall have first fully repaired the
damage or paid all of the salvage or other charges, may be paid to the Shipowner
as reimbursement therefor;  provided, however, that if such amounts (including
any franchise or deductible) are in excess of U.S. $[1,000,000], the
underwriters shall not make such payment without first obtaining the written
consent thereto of the Mortgagee, which shall not be unreasonably withheld.

(e)           All amounts paid to the Mortgagee in respect of any insurance on
the Vessel shall be disposed of as follows (after deduction of the expenses of
the Mortgagee in collecting such amounts):

(i)           any amount which might have been paid at the time, in accordance
with the provisions of paragraph (d) above, directly to the Shipowner or others
shall be paid by the Mortgagee to, or as directed by, the Shipowner;

(ii)           all amounts paid to the Mortgagee in respect of an Event of Loss
of the Vessel shall be applied by the Mortgagee to the payment of the
Indebtedness hereby secured pursuant to Section 4.02(b) of the Credit Agreement;

(iii)           all other amounts paid to the Mortgagee in respect of any
insurance on the Vessel may, in the Mortgagee’s sole discretion, be held and
applied to the prepayment of the Indebtedness hereby secured or to making of
needed repairs or other work on the Vessel, or 
 
 
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to the payment of other claims incurred by the Shipowner relating to the Vessel,
or may be paid to the Shipowner or whosoever may be entitled thereto.

(f)           In the event that any claim or lien is asserted against the Vessel
for loss, damage or expense which is covered by insurance required hereunder and
it is necessary for the Shipowner to obtain a bond or supply other security to
prevent arrest of the Vessel or to release the Vessel from arrest on account of
such claim or lien, the Mortgagee, on request of the Shipowner, may, in the sole
discretion of the Mortgagee, assign to any person, firm or corporation executing
a surety or guarantee bond or other agreement to save or release the Vessel from
such arrest, all right, title and interest of the Mortgagee in and to said
insurance covering said loss, damage or expense, as collateral security to
indemnify against liability under said bond or other agreement.

(g)           The Shipowner shall deliver to the Mortgagee certified copies and,
whenever so requested by the Mortgagee, the originals of all certificates of
entry, cover notes, binders, evidences of insurance and policies and all
endorsements and riders amendatory thereof in respect of insurance maintained
under this Mortgage for the purpose of inspection or safekeeping, or,
alternatively, satisfactory letters of undertaking from the broker holding the
same.  The Mortgagee shall be under no duty or obligation to verify the adequacy
or existence of any such insurance or any such policies, endorsement or riders.

(h)           The Shipowner agrees that it will not execute or permit or
willingly allow to be done any act by which any insurance may be suspended,
impaired or cancelled, and that it will not permit or allow the Vessel to
undertake any voyage or run any risk or transport any cargo which may not be
permitted by the policies in force, without having previously notified the
Mortgagee in writing and insured the Vessel by additional coverage to extend to
such voyages, risks, passengers or cargoes.

(i)           In case any underwriter proposes to pay less on any claim than the
amount thereof, the Shipowner shall forthwith inform the Mortgagee, and if a
Default, an Event of Default or an Event of Loss has occurred and is continuing,
the Mortgagee shall have the exclusive right to negotiate and agree to any
compromise.

(j)           The Shipowner will comply with and satisfy all of the provisions
of any applicable law, convention, regulation, proclamation or order concerning
financial responsibility for liabilities imposed on the Shipowner or the Vessel
with respect to pollution by any state or nation or political subdivision
thereof and will maintain all certificates or other evidence of financial
responsibility as may be required by any such law, convention, regulation,
proclamation or order with respect to the trade in which the Vessel is from time
to time engaged and the cargo carried by it.

Section 14.                                Reimbursement for Expenses. The
Shipowner will reimburse the Mortgagee promptly for any and all reasonable
expenditures which the Mortgagee may from time to time make, layout or expend in
providing such protection in respect of insurance, discharge or purchase of
liens, taxes, dues, tolls, assessments, governmental charges, fines and
penalties lawfully imposed, repairs, attorney’s fees, and other matters as the
Shipowner is obligated herein to provide, but fails to provide or which, in the
sole judgment of the Mortgagee are necessary or appropriate for the protection
of the Vessel or the security granted by this Mortgage.  Such obligation of the
Shipowner to reimburse the Mortgagee shall be an additional indebtedness due
from the Shipowner, shall bear interest at the interest rate as set forth in
Section 1.07(b) of the Credit Agreement from the date of payment by the
Mortgagee to and including the date of reimbursement by the Shipowner, shall be
secured by this Mortgage, and shall be payable by the Shipowner on demand.  The
Mortgagee, though
 
 
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 privileged to do so, shall be under no obligation to the Shipowner to make any
such expenditure, nor shall the making thereof relieve the Shipowner of any
default in that respect.

Section 15.                                Performance of Charters. The
Shipowner will fully perform any and all charter parties which may be entered
into with respect to the Vessel and will promptly notify the Mortgagee of any
material claim by any charterer of non-performance thereunder by the Shipowner.

Section 16.                                Change in Ownership. The Shipowner
further covenants and agrees with the Mortgagee that, so long as any part of the
Indebtedness hereby secured remains unpaid, there shall be no change in the
ownership of the Vessel or any of the shares of the Shipowner without the prior
written consent of the Mortgagee, which shall not be unreasonably withheld.

Section 17.                                Prepayment if Event of Loss.  In the
event that the Vessel suffers an Event of Loss, then and in each such case the
Shipowner shall forthwith repay the Indebtedness hereby secured at the time and
in the amount set forth in Section 4.02(b) of the Credit Agreement except to the
extent such amounts have otherwise been paid as therein provided.

ARTICLE III

Events of Default and Remedies

Section 1.                      Events of Default; Remedies.  In case anyone or
more of the following events, herein termed “events of default”, shall happen:

(a)           the Shipowner fails to pay within three (3) Business Days of the
date due any payment in respect of the Indebtedness hereby secured as provided
herein; or

(b)           the statements in Article I shall prove to have been untrue in a
material way when made; or

(c)           a default in the due and punctual observance and performance of
any of the provisions of Sections 2, 3, 7, 8, 9(b), 11, 12, 13(a), (b), (d), (h)
and (j), 16 or 17 of Article II hereof shall have occurred and be continuing; or

(d)           a breach or omission in the due and punctual observance of any of
the other covenants and conditions herein required to be kept and performed by
the Shipowner and such breach or omission shall continue for 30 days after the
day the Shipowner first knew or should have known of such breach or omission; or

(e)           an Event of Default shall have occurred and be continuing under
the Credit Agreement; or

(f)           a payment default by the Borrower under any Interest Rate
Protection Agreement or Other Hedging Agreement shall have occurred and be
continuing; or

(g)           any notice shall have been issued by the government or any bureau,
department, officer, board or agency thereof of the country of registry of the
Vessel to the effect that the Vessel is subject to cancellation from such
registry or the certificate of registry of the Vessel is subject to revocation
or cancellation for any reason whatsoever, and such
 
 
 
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 notice shall not have been cancelled or annulled on or before seven (7)
Business Days prior to the date set forth in such notice for such cancellation
or revocation; or

(h)           the Vessel shall be cancelled from the country of registry of the
Vessel or the certificate of registry of the Vessel is revoked or cancelled for
any reason whatsoever;

then:

the security constituted by this Mortgage shall become immediately enforceable
and that without limitation, the enforcement remedies specified can be exercised
irrespective of whether or not the Mortgagee has exercised the right of
acceleration under the Credit Agreement or any of the other Credit Documents and
the Mortgagee shall have the right to:

(i)           Declare all the then unpaid Indebtedness hereby secured to be due
and payable immediately, and upon such declaration, the same shall become and be
immediately due and payable provided, however, that no declaration shall be
required if an event of default shall have occurred by reason of a default under
Section 10.05 of the Credit Agreement, then and in such case, the Indebtedness
hereby secured shall become immediately due and payable on the occurrence of
such event of default without any notice or demand;

(ii)           Exercise all of the rights and remedies in foreclosure and
otherwise given to a mortgagee by the provisions of the laws of the country of
registry of the Vessel or of any other jurisdiction where the Vessel may be
found;

(iii)           Bring suit at law, in equity or in admiralty, as it may be
advised, to recover judgment for the Indebtedness hereby secured, and collect
the same out of any and all property of the Shipowner whether covered by this
Mortgage or otherwise;

(iv)           Take and enter into possession of the Vessel, at any time,
wherever the same may be, without legal process and without being responsible
for loss or damage and the Shipowner or other person in possession forthwith
upon demand of the Mortgagee shall surrender to the Mortgagee possession of the
Vessel;

(v)           Without being responsible for loss or damage, the Mortgagee may
hold, lay up, lease, charter, operate or otherwise use such Vessel for such time
and upon such terms as it may deem to be for its best advantage, and demand,
collect and retain all hire, freights, earnings, issues, revenues, income,
profits, return premiums, salvage awards or recoveries, recoveries in general
average, and all other sums due or to become due in respect of such Vessel or in
respect of any insurance thereon from any person whomsoever, accounting only for
the net profits, if any, arising from such use of the Vessel and charging upon
all receipts from the use of the Vessel or from the sale thereof by court
proceedings or pursuant to subsection (vi) next following, all costs, expenses,
charges, damages or losses by reason of such use; and if at any time the
Mortgagee shall avail itself of the right herein given them to take the Vessel,
the Mortgagee shall have the right to dock the Vessel, for a reasonable time at
any dock, pier or other premises of the Shipowner without charge, or to dock her
at any other place at the cost and expense of the Shipowner;

(vi)           Without being responsible for loss or damage, the Mortgagee may
sell the Vessel upon such terms and conditions as to the Mortgagee shall seem
best, free from any
 
 
 
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claim of or by the Shipowner, at public or private sale, by sealed bids or
otherwise, by mailing, by air or otherwise, notice of such sale, whether public
or private, addressed to the Shipowner at its last known address and to any
other registered mortgagee, twenty (20) calendar days prior to the date fixed
for entering into the contract of sale and by first publishing notice of any
such public sale for ten (10) consecutive days, in daily newspapers of general
circulation published in the City of New York, State of New York; in the event
that the Vessel shall be offered for sale by private sale, no newspaper
publication of notice shall be required, nor notice of adjournment of sale; sale
may be held at such place and at such time as the Mortgagee by notice may have
specified, or may be adjourned by the Mortgagee from time to time by
announcement at the time and place appointed for such sale or for such adjourned
sale, and without further notice or publication the Mortgagee may make any such
sale at the time and place to which the same shall be so adjourned; and any sale
may be conducted without bringing the Vessel to the place designated for such
sale and in such manner as the Mortgagee may deem to be for its best advantage,
and the Mortgagee may become the purchaser at any sale.  The Shipowner agrees
that any sale made in accordance with the terms of this paragraph shall be
deemed made in a commercially reasonable manner insofar as it is concerned;

(vii)            Require that all policies, contracts, certificates of entry and
other records relating to the insurance with respect to the Vessel, including,
but not limited to, those described in Article II, Section 13 hereof (the
“Insurances”) (including details of and correspondence concerning outstanding
claims) be forthwith delivered to or to the order of the Mortgagee; and/or

(viii)            Collect, recover, compromise and give a good discharge for any
and all monies and claims for monies then outstanding or thereafter arising
under the Insurances or in respect of the earnings or any requisition
compensation and to permit any brokers through whom collection or recovery is
effected to charge the usual brokerage therefor.

Section 2.                      Power of Sale.  Any sale of the Vessel made in
pursuance of this Mortgage, whether under the power of sale hereby granted or
any judicial proceedings, shall operate to divest all right, title and interest
of any nature whatsoever of the Shipowner therein and thereto, and shall bar the
Shipowner, its successors and assigns, and all persons claiming by, through or
under them.  No purchaser shall be bound to inquire whether notice has been
given, or whether any default has occurred, or as to the propriety of the sale,
or as to the application of the proceeds thereof.  In case of any such sale, the
Mortgagee, if it is the purchaser, shall be entitled, for the purpose of making
settlement or payment for the property purchased, to use and apply the
Indebtedness hereby secured in order that there may be credited against the
amount remaining due and unpaid thereon the sums payable out of the net proceeds
of such sale to the Mortgagee after allowing for the costs and expense of sale
and other charges; and thereupon such purchaser shall be credited, on account of
such purchase price, with the net proceeds that shall have been so credited upon
the Indebtedness hereby secured.  At any such sale, the Mortgagee may bid for
and purchase such property and upon compliance with the terms of sale may hold,
retain and dispose of such property without further accountability therefor.

Section 3.                      Power of Attorney-Sale.  The Mortgagee is hereby
irrevocably appointed attorney-in-fact of the Shipowner to execute and deliver
to any purchaser aforesaid, and is hereby vested with full power and authority
to make, in the name and on behalf of the Shipowner, a good conveyance of the
title to the Vessel so sold.  Any person dealing with the Mortgagee or
attorney-in-fact shall not be put on enquiry as to whether the power of attorney
contained herein has become exercisable.  In the event of any sale of the
Vessel, under any power herein contained, the
 
 
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Shipowner will, if and when required by the Mortgagee, execute such form of
conveyance of the Vessel as the Mortgagee may direct or approve.

Section 4.                      Power of Attorney-Collection.  The Mortgagee is
hereby irrevocably appointed attorney-in-fact of the Shipowner upon the
happening of any event of default, in the name of the Shipowner to demand,
collect, receive, compromise and sue for, so far as may be permitted by law, all
freight, hire, earnings, issues, revenues, income and profits of the Vessel and
all amounts due from underwriters under any insurance thereon as payment of
losses or as return premiums or otherwise, salvage awards and recoveries,
recoveries in general average or otherwise, and all other sums due or to become
due at the time of the happening of any event of default as defined in Section 1
of Article III hereof in respect of the Vessel, or in respect of any insurance
thereon, from any person whomsoever, and to make, give and execute in the name
of the Shipowner acquittances, receipts, releases or other discharges for the
same, whether under seal or otherwise, and to endorse and accept in the name of
the Shipowner all checks, notes, drafts, warrants, agreements and other
instruments in writing with respect to the foregoing.  Any person dealing with
the Mortgagee or attorney-in-fact shall not be put on enquiry as to whether the
Power of Attorney contained herein has become exercisable.

Section 5.                      Delivery of Vessel.  Upon the security
constituted by this Mortgage becoming immediately enforceable pursuant to
Section 1 of Article III, the Mortgagee shall (in addition to the powers
described in Section 1 of Article III) become forthwith entitled (but not bound)
to appoint, by an instrument in writing under its seal or under the hand of any
director or officer or authorized signatory, a receiver and/or manager of the
Vessel upon such terms as to remuneration and otherwise as the Mortgagee shall
deem fit with power from time to time to remove any receiver and appoint another
in his stead and any receiver shall be the agent of the Shipowner (who shall be
solely responsible for his acts and defaults and remuneration) and shall have
all the powers conferred by law by way of addition to, but without limiting,
those powers any receiver shall have all the powers and entitlements conferred
on the Mortgagee by this Mortgage and generally shall be entitled to the same
protection and to exercise the same powers and discretions as are granted to the
Mortgagee under this Mortgage.
 
               Section 6.                      Mortgagee to Discharge
Liens.  The Shipowner authorizes and empowers the Mortgagee or its appointees or
any of them to appear in the name of the Shipowner, its successors and assigns,
in any court of any country or nation of the world where a suit is pending
against the Vessel because of or on account of any alleged lien against the
Vessel from which the Vessel has not been released and to take such proceedings
as to them or any of them may seem proper towards the defense of such suit and
the purchase or discharge of such lien, and all expenditures made or incurred by
them or any of them for the purpose of such defense or purchase or discharge
shall be a debt due from the Shipowner, its successors and assigns, to the
Mortgagee, and shall be secured by the lien of this Mortgage in like manner and
extent as if the amount and description thereof were written herein.

Section 7.                      Payment of Expenses.  The Shipowner covenants
that upon the happening of any one or more of the events of default, then, upon
written demand of the Mortgagee, the Shipowner will pay to the Mortgagee the
whole amount due and payable in respect of the Indebtedness hereby secured; and
in case the Shipowner shall fail to pay the same forthwith upon such demand, the
Mortgagee shall be entitled to recover judgment for the whole amount so due and
unpaid, together with such further amounts as shall be sufficient to cover the
reasonable compensation of the Mortgagee or its agents, attorneys and counsel
and any necessary advances, expenses and liabilities made or incurred
 
 
 
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 by it or them or the Mortgagee hereunder.  All moneys collected by the
Mortgagee under this Section 7 shall be applied by the Mortgagee in accordance
with the provisions of Section 11 of this Article III.

Section 8.                     Remedies Cumulative.  Each and every power and
remedy herein given to the Mortgagee shall be cumulative and shall be in
addition to every other power and remedy herein given or now or hereafter
existing at law, in equity, in admiralty or by statute, and each and every power
and remedy whether herein given or otherwise existing may be exercised from time
to time and as often and in such order as may be deemed expedient by the
Mortgagee, and the exercise or the beginning of the exercise of any power or
remedy shall not be construed to be a waiver of the right to exercise at the
same time or thereafter any other power or remedy.  The Mortgagee shall not be
required or bound to enforce any of its rights under any of the other Credit
Documents, prior to enforcing its rights under this Mortgage.  No delay or
omission by the Mortgagee in the exercise of any right or power or in the
pursuance of any remedy accruing upon any default as above defined shall impair
any such right, power or remedy or be construed to be a waiver of any such event
of default or to be an acquiescence therein; nor shall the acceptance by the
Mortgagee of any security or of any payment of or on account of the Indebtedness
hereby secured maturing after any event of default or of any payment on account
of any past default be construed to be a waiver of any right to exercise its
remedies due to any future event of default or of any past event of default not
completely cured thereby.  No consent, waiver or approval of the Mortgagee shall
be deemed to be effective unless in writing and duly signed by authorized
signatories of the Mortgagee;  any waiver by the Mortgagee of any of the terms
of this Mortgage or any consent given under this Mortgage shall only be
effective for the purpose and on the terms which it is given and shall be
without prejudice to the right to give or withhold consent in relation to future
matters (which are either the same or different).

Section 9.                      Cure of Defaults.  If at any time after an event
of default and prior to the actual sale of the Vessel by the Mortgagee or prior
to any enforcement or foreclosure proceedings the Shipowner offers completely to
cure all events of default and to pay all expenses, advances and damages to the
Mortgagee consequent on such events of default, with interest at the interest
rate set forth in Section 1.07(b) of the Credit Agreement, then the Mortgagee
may, but shall not be obligated to, accept such offer and payment and restore
the Shipowner to its former position, but such action, if taken, shall not
affect any subsequent event of default or impair any rights consequent thereon.

Section 10.                    Discontinuance of Proceedings.  In case the
Mortgagee shall have proceeded to enforce any right, power or remedy under this
Mortgage by foreclosure, entry or otherwise, and such proceedings shall have
been discontinued or abandoned for any reason or shall have been determined
adversely to the Mortgagee, then and in every such case the Shipowner and the
Mortgagee shall be restored to its former position and right hereunder with
respect to the property subject or intended to be subject to this Mortgage, and
all rights, remedies and powers of the Mortgagee shall continue as if no such
proceedings had been taken.

Section 11.                     Application of Proceeds.  After an event of
default hereunder shall have occurred and be continuing, the proceeds of any
sale of the Vessel and any and all other moneys received by the Mortgagee
pursuant to or under the terms of this Mortgage or in any proceedings hereunder,
the application of which has not elsewhere herein been specifically provided
for, shall be applied as follows:

First:                      To the payment of all costs and expenses (together
with interest thereon as set forth in Section 14 of Article II) of the
Mortgagee, including the reasonable compensation of its agents and attorneys, by
reason of any sale, retaking, management or
 
 
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operation of the Vessel and all other sums payable to the Mortgagee hereunder by
reason of any expenses or liabilities incurred or advances made by it for the
protection, maintenance and enforcement of the security or of any of its rights
hereunder, under the Credit Agreement, the Guaranty and under the other Credit
Documents or in the pursuit of any remedy hereby or thereby conferred; and at
the option of the Mortgagee to the payment of any taxes, assessments or liens
claiming priority over the lien of this Mortgage; and

Second:                      To the Pledgee (as defined in the Pledge Agreement)
for its distribution in accordance with the provisions of Section 9 of the
Pledge Agreement; and

Third:                      To the Shipowner or as may be directed by a court of
competent jurisdiction.

Section 12.                                Possession Until Default.  Until one
or more of the events of default hereinafter described shall happen, the
Shipowner (a) shall be suffered and permitted to retain actual possession and
use of the Vessel and (b) shall have the right, from time to time, in its
discretion, and without application a notice to the Mortgagee, and without
obtaining a release thereof by the Mortgagee, to dispose of, free from the lien
hereof, any boilers, engines, machinery, masts, spars, sails, rigging, boats,
anchors, chains, tackle, apparel, furniture, fittings or equipment or any other
appurtenances of the Vessel that are no longer useful, necessary, profitable or
advantageous in the operation of the Vessel, first or simultaneously replacing
the same by new boilers, engines, machinery, masts, spars, sails, rigging,
boats, anchors, chains, tackle, apparel, furniture, fittings, equipment, or
other appurtenances of substantially equal value to the Shipowner, which shall
forthwith become subject to the lien of this Mortgage as a first priority
mortgage thereon.

Section 13.                                Severability of Provisions, etc  (a)
If any provision of this Mortgage should be deemed invalid or shall be deemed to
affect adversely the preferred status of this Mortgage under any applicable law,
such provision shall be void and of no effect and shall cease to be a part of
this Mortgage without affecting the remaining provisions, which shall remain in
full force and effect.

(b)           In the event that the Guaranty, this Mortgage, any of the other
Credit Documents or any of the documents or instruments which may from time to
time be delivered thereunder or hereunder or any provision thereof or hereof
shall be deemed invalidated by present or future law of any nation or by
decision of any court, this shall not affect the validity and/or enforceability
of all or any other parts of the Guaranty, this Mortgage, any of the other
Credit Documents or such documents or instruments and, in any such case, the
Shipowner covenants and agrees that, on demand, it will execute and deliver such
other and further agreements and/or documents and/or instruments and do such
things as the Mortgagee in its sole discretion may reasonably deem to be
necessary to carry out the true intent of this Mortgage, the Guaranty and the
other Credit Documents.

(c)           In the event that the title, or ownership of the Vessel shall be
requisitioned, purchased or taken by any government of any country or any
department, agency or representative thereof, pursuant to any present or future
law, proclamation, decree order or otherwise, the lien of this Mortgage shall be
deemed to attach to the claim for compensation therefor, and the compensation,
purchase or other taking of such title or ownership is hereby agreed to be
payable to the Mortgagee who shall be entitled to receive the same and shall
apply it as provided in Section 11 of this Article III.  In the event of any
such requisition, purchase or taking, and the failure of the Mortgagee to
receive proceeds as herein provided, the Shipowner shall promptly execute and
deliver to the Mortgagee such documents, if any, as in the opinion of the
Mortgagee may be necessary or useful to facilitate or
 
 
 
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expedite the collection by the Mortgagee of such part of the compensation,
purchase price, reimbursement or award as is payable to it hereunder.

(d)           Anything herein to the contrary notwithstanding, it is intended
that nothing herein shall waive the priority status of this Mortgage, and if any
provision of this Mortgage or portion thereof shall be construed to waive the
priority status of this Mortgage, then such provision to such extent shall be
void and of no effect.

ARTICLE IV

Sundry Provisions

Section 1.                      Successors and Assigns.  All of the covenants,
promises, stipulations and agreements of the Shipowner in this Mortgage
contained shall bind the Shipowner and its successors and shall inure to the
benefit of the Mortgagee and its successors and assigns. In the event of any
assignment or transfer of this Mortgage, the term “Mortgagee”, as used in this
Mortgage, shall be deemed to mean any such assignee or transferee.

Section 2.                      Power of Substitution.  Wherever and whenever
herein any right, power or authority is granted or given to the Mortgagee, such
right, power or authority may be exercised in all cases by the Mortgagee or such
agent or agents as it may appoint, and the act or acts of such agent or agents
when taken shall constitute the act of the Mortgagee hereunder.

Section 3.                      Counterparts.  This Mortgage may be executed in
any number of counterparts, each of which shall be an original, but such
counterparts shall together constitute but one and the same instrument.

Section 4.                      Notices.  Except as otherwise expressly provided
herein, all notices and other communications provided for hereunder shall be in
writing (including telexed, telegraphic, telex, telecopier or cable
communication) and mailed, telexed, telecopied, cabled or delivered, if to the
Shipowner or to the Mortgagee, at its address as specified below, or at such
other address as shall be designated by such party in a written notice to the
other party:

If to the Shipowner, addressed to it in care of:

Genco Ship Management LLC
35 West 56th Street
New York, NY 10019
USA                                                                           Telephone:
646-443-8525
Facsimile:  646-443-8551
Email: finance@gencoshipping.com

If to the Mortgagee, addressed to it:

DnB Nor Bank ASA, New York Branch
200 Park Avenue, 31st Floor
New York, NY 10166-0396
Attention:  Nikolai Nachamkin
 
 
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Facsimile: 212-681-3900

All such notices and communications shall, (i) when mailed, be effective three
Business Days after being deposited in the mails, prepaid and properly addressed
for delivery, (ii) when sent by overnight courier, be effective one Business Day
after delivery to the overnight courier prepaid and properly addressed for
delivery on such next Business Day, or (iii) when sent by telex or telecopier,
be effective when sent by telex or telecopier, except that notices and
communications to the Mortgagee shall not be effective until received by the
Mortgagee.

Section 5.                      Recording: Clause.  For purposes of recording
this First Preferred Mortgage as required by Chapter 3 of the Republic of the
Marshall Islands Maritime Act of 1990, as amended, the total amount of the
direct and contingent obligations secured by this Mortgage is [            ]
United States Dollars (U.S. $[        ]), comprising of One Billion Three
Hundred Seventy Seven Million United States Dollars (U.S. $1,377,000,000) for
the Loan and [            ] (U.S. $[         ]) for the Hedging Liabilities, and
interest and performance of mortgage covenants.  The maturity date is on
demand.  There is no separate discharge amount.

Section 6.                      Further Assurances.  The Shipowner shall execute
and do all such assurances, acts and things as the Mortgagee, or any receiver in
its absolute discretion may require for:

(a)                    perfecting or protecting the security created (or
intended to be created) by this Mortgage; or

(b)                    preserving or protecting any of the rights of the
Mortgagee under this Mortgage (or any of them); or

(c)                    ensuring that the security constituted by this Mortgage
and the covenants and obligations of the Shipowner under this Mortgage shall
enure to the benefit of assignees of the Mortgagee (or any of them); or

(d)                    facilitating the appropriation or realization of the
Vessel or any part thereof and enforcing the security constituted by this
Mortgage on or at any time after the same shall have become enforceable; or

(e)                    the exercise of any power, authority or discretion vested
in the Mortgagee under this Mortgage,

in any such case, forthwith upon demand by the Mortgagee and at the expense of
the Shipowner.

Section 7.                      Governing Law.  The provisions of this Mortgage
shall, with respect to its validity, effect, recordation and enforcement, be
governed by and construed in accordance with the applicable laws of the Republic
of the Marshall Islands.

Section 8.                      Additional Rights of the Mortgagee.  In the
event the Mortgagee shall be entitled to exercise any of its remedies under
Article III hereof, the Mortgagee shall have the right to arrest and take action
against the Vessel at whatever place the Vessel shall be found lying and for the
purpose of any action which the Mortgagee may bring before the Courts of such
jurisdiction or other judicial authority and for the purpose of any action which
the Mortgagee may bring against the Vessel, any writ, notice, judgment or other
legal process or documents may (without prejudice to any other
 
 
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 method of service under applicable law) be served upon the Master of the Vessel
(or upon anyone acting as the Master) and such service shall be deemed good
service on the Shipowner for all purposes.
 
 
[THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK]
 
 
 
 
 
 
 
 
 
 
 
 
 

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IN WITNESS WHEREOF, the Shipowner has caused this First Preferred Mortgage over
the [VESSEL NAME] to be duly executed by its authorized representative the day
and year first above written.

[NAME OF SHIPOWNER]

By:  ____________________
Name:
Title:
 
 
 
 
 
 

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ACKNOWLEDGMENT

STATE OF NEW YORK                )
                                                :  SS:
COUNTY OF NEW YORK            )

On this [     ] day of [DATE], before me personally appeared [NAME], known to me
to be the person who executed the foregoing instrument, who, being by me duly
sworn did depose and say that he resides at _______________________, New York,
NY;  that he is [TITLE] of [SHIPOWNER], the Marshall Islands limited liability
company described in and which executed the foregoing instrument;  that he
signed his name pursuant to authority granted to him by [SHIPOWNER];  and that
he further acknowledged that said instrument is the act and deed of [SHIPOWNER].

______________________
Notary Public

 
 
 
 
 
 
[FOR USE IN THE REPUBLIC OF THE MARSHALL ISLANDS]
 
 
 
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        Exhibit M      
      
        
      
    

LETTER OF CREDIT REQUEST
 
No.    1                         Dated       2      
 
DnB Nor Bank ASA, New York Branch (“DNB”), as Administrative Agent under the
Credit Agreement (as amended, modified or supplemented from time to time, the
“Credit Agreement”), dated as of July __, 2007 among Genco Shipping & Trading
Limited, various Lenders, DNB, as Administrative Agent

Attention:                                                                
 
Ladies and Gentlemen:
 
The Borrower hereby requests that [name of proposed Issuing Bank], in its
individual capacity, issue a standby Letter of Credit for the account of the
undersigned on  3  (the “Date of Issuance”) in the aggregate stated amount of
      4      .
 
For purposes of this Letter of Credit Request, unless otherwise defined herein,
all capitalized terms used herein which are defined in the Credit Agreement
shall have the respective meaning provided therein.
 
The beneficiary of the requested Letter of Credit will be       5      , and
such Letter of Credit will be in support of       6       and will have a stated
expiration date of       7      .
 
The Borrower hereby certifies that:
 
(1)           the representations and warranties contained in the Credit
Documents will be true and correct in all material respects on the Date of
Issuance, both before and after giving effect to the issuance of the Letter of
Credit requested hereby (it being understood and agreed that any representation
or warranty which by its terms is made as of a
 
 
________________
 
1
Letter of Credit Request Number.

 
2
Date of Letter of Credit Request.

 
3
Date of Issuance which shall be at least five Business Days after the date of
this Letter of Credit Request (or such shorter period as is acceptable to the
respective Issuing Lender).

 
4
Aggregate initial stated amount of Letter of Credit (which amount shall not be
less than $[20,000]).

 
5
Insert name and address of beneficiary.

 
6
Insert description of L/C Supportable Obligations and describe obligation to
which it relates.

 
7
Insert last date upon which drafts may be presented which may not be later than
the earlier of (x) the date which occurs 12 months after the Date of Issuance
and (y) the tenth Business Day prior to the Revolving Loan Maturity Date.

 

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Exhibit M
Page 2

specified date shall be required to be true and correct in all material respects
only as of such specified date);
 
 
(2)           no Default or Event of Default has occurred and is continuing nor,
after giving effect to the issuance of the Letter of Credit requested hereby,
would such a Default or an Event of Default occur;
 
(3)           the aggregate amount of all Letter of Credit Outstandings
(determined on a proforma basis after giving effect to the issuance of the
Letter of Credit requested hereby) does not exceed $[50,000,000]; and
 
(4)           the Letter of Credit requested hereby will be used to support
obligations of the Borrower and its Subsidiaries incurred in the ordinary course
of business.
 
Copies of all relevant documentation with respect to the supported transaction
are attached hereto.
 
   GENCO SHIPPING & TRADING LIMITED
 
   
By_________________________                                                                            
Name:
Title:
 
 

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                  Exhibit N              
    

ASSIGNMENT OF PURCHASE CONTRACT

[VESSEL]

THIS ASSIGNMENT OF PURCHASE CONTRACT, dated [CLOSING DATE], is given by
[SHIPOWNER], a Marshall Islands corporation and registered under Part XI of the
Hong Kong Companies Ordinance having its principal place of business at 15th
Floor, Tower One, Lippo Centre, 89 Queensway, Hong Kong (the “Assignor”), in
favor of DNB NOR BANK ASA, NEW YORK BRANCH, a bank incorporated under the laws
of the Kingdom of Norway, acting through its New York branch, with offices at
200 Park Avenue, New York, New York 10166-0396, as Collateral Agent under the
Credit Agreement referred to below (the “Assignee”).  Except as otherwise
defined herein, capitalized terms used herein and defined in the Credit
Agreement (as defined below) shall be used herein as so defined.

RECITALS

A.           The Assignor has entered into a Purchase Contract to purchase
[describe vessel and status] (the “Vessel”).

B.           Genco Shipping & Trading Limited, a Marshall Islands corporation
(the “Borrower”) has entered into a Credit Agreement dated as of July __, 2007
(as the same may be amended, supplemented or otherwise modified from time to
time, the “Credit Agreement”) among (i) various Lenders referred to therein,
(ii) the Assignee, as Administrative Agent, mandated lead arranger, bookrunner
and Collateral Agent, providing for the making of revolving loans to the
Borrower in the principal amount of up to One Billion Three Hundred Seventy
Seven Million United States Dollars (U.S. $1,377,000,000) (the Lenders, the
Administrative Agent and Collateral Agent, collectively, the “Lender
Creditors”).

C.           The Assignor is a wholly-owned subsidiary of the Borrower.

D.           The Borrower may at any time and from time to time enter into, or
guaranty the obligations of one or more Subsidiary Guarantors or any of their
respective Subsidiaries under, one or more Interest Rate Protection Agreements
or Other Hedging Agreements with respect to the Loan (and/or the Commitments)
with one or more Lenders or any Affiliate thereof (each such Lender or
Affiliate, even if the respective Lender subsequently ceases to be a Lender
under the Credit Agreement for any reason, together with such Lender’s or
Affiliate’s successors and assigns, if any, collectively, the “Other Creditors”
and, together with the Lender Creditors, the “Secured Creditors”).

E.           The Assignor has entered into the Guaranty in favor of the Secured
Creditors pursuant to which the Assignor has guaranteed (i) to the Lender
Creditors, all obligations of the Borrower under the Credit Agreement and each
other Credit Document to which the Borrower is a party, and (ii) to each of the
Other Creditors, all obligations of the Borrower under each Interest Rate
Protection Agreement and each Other Hedging Agreement entered into with respect
to the Loan (and/or the Commitments), among other things, its obligations under
the Guaranty.

F.           It is a condition to the obligation of the Lenders to advancing the
Loan, in respect of the Additional Vessels (including the Capesize Vessels), to
the Borrower under the Credit Agreement that the Assignor enters into this
Assignment as security for its obligations under the Guaranty.
 
 
 

--------------------------------------------------------------------------------

 

NOW, THEREFORE, the parties hereto agree as follows:

Section 1.          As security for all amounts due and to become due to the
Secured Creditors under the Guaranty, the Assignor as beneficial owner hereby
grants, sells, conveys, assigns, transfers, mortgages and pledges to the
Assignee, and unto the Assignee’s successors and assigns, all its right, title,
interest, claim and demand in and to, and hereby also grants unto the Assignee a
security interest in and to (i) the Purchase Contract, (ii) all moneys and
claims for moneys due and to become due to the Assignor under and all claims for
damages arising out of the breach (or payments for variation or termination) of
the Purchase Contract, including but not limited to the Assignor’s interest in
the deposit being made in connection with the entry into the Purchase Contract
and any escrow account in respect of such deposit, and (iii) any proceeds of any
of the foregoing.  The Assignor hereby covenants and undertakes to give prompt
notice of this Assignment to the seller of the Vessel in the form of Exhibit A
hereto.

Section 2.          Anything herein contained to the contrary notwithstanding,
the Assignee, or its respective successors and assigns, shall have no obligation
or liability under the Purchase Contract arising out of this Assignment.

Section 3.          The Assignor hereby constitutes the Assignee, its successors
and assigns, its true and lawful attorney-in-fact, irrevocably, with full power,
in the name of the Assignor or otherwise, upon the occurrence and continuance of
a Default or an Event of Default, to ask, require, demand, receive, compound and
give acquittance for any and all moneys and claims for moneys due and to become
due, property and rights hereby assigned, to endorse any checks or other
instruments or orders in connection therewith and to file any document or to
take any action or institute any proceedings which the Assignee and its
successors and assigns may reasonably deem necessary or advisable in the
premises.

Section 4.          The powers and authorities granted to the Assignee and its
successors or assigns herein have been given for valuable consideration and are
hereby declared to be irrevocable.

Section 5.          The Assignor warrants and represents that it has not
assigned or pledged the rights, title and interest assigned hereunder to anyone
other than the Assignee.  The Assignor hereby covenants that, without the prior
written consent thereto of the Assignee, so long as this Assignment shall remain
in effect, it will not assign or pledge the whole or any part of the rights,
title and interest hereby assigned to anyone other than the Assignee, and it
will not take or omit to take any action, the taking or omission of which might
result in an alteration or impairment of this Assignment, or of any of the
rights created by this Assignment.

Section 6.         The Assignor agrees that at any time and from time to time,
upon the written request of the Assignee, the Assignor will promptly and duly
execute and deliver any and all further instruments and documents as the
Assignee may deem desirable in obtaining the full benefits of this Assignment.

Section 7.         THIS ASSIGNMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
HEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND BE GOVERNED BY THE LAW OF
THE STATE OF NEW YORK WITHOUT REGARD TO ITS CONFLICT OF LAWS RULES (OTHER THAN
TITLE 14 OF ARTICLE 5 OF THE GENERAL
 
 
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OBLIGATIONS LAW).  This Assignment shall not be amended and/or varied except by
agreement in writing signed by the parties hereto.

Section 8.          Any notice, demand or other communication to be given under
or for the purposes of this Assignment shall be made as provided in Section
15.03 of the Credit Agreement.

Section 9.          This Assignment may be executed in any number of
counterparts each of which shall be an original, but all such counterparts shall
together constitute one and the same instrument.

IN WITNESS WHEREOF, the Assignor has duly executed this instrument on the day
and year first above written.

[SHIPOWNER],
as Assignor

By:  __________________
Name: [                         ]
Title: [                           ]
 
 
3

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Exhibit A to
PURCHASE CONTRACT ASSIGNMENT

FORM OF NOTICE OF ASSIGNMENT

The undersigned, [SHIPOWNER], the purchaser of the Vessel described in the
assignment attached hereto, hereby gives you notice that by an Assignment of
Purchase Contract dated  ________, 2007, entered into by us with DNB NOR BANK
ASA, NEW YORK BRANCH in its capacity as Collateral Agent for certain Lenders
(hereinafter called the “Assignee”), a copy of which is attached hereto, there
has been assigned by us to the Assignee all  of our right, title and interest in
and to (i) the memorandum of agreement dated _______, 200_ (the “Purchase
Contract”) between us and [Seller’s name], a company organized and existing
under the laws of [_____], as seller, with respect to the acquisition of the
Vessel named therein, (ii) all moneys and claims for moneys due and to become
due to the undersigned, whether as indemnities, payments or otherwise, and all
claims for damages arising out of any breach of such Purchase Contract, and (b)
you are hereby irrevocably authorized and instructed to pay as from the date
hereof all such aforesaid moneys to the Assignee (Account No. []) at 200 Park
Avenue, New York, New York 10166-0396.

[SHIPOWNER]
as Owner,

By:  __________________
Name:
Title:

Dated:  _____________
 

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                  Exhibit O              
    
 

ASSIGNMENT OF CONSTRUCTION CONTRACT AND REFUND GUARANTEE

[VESSEL]

THIS ASSIGNMENT OF CONSTRUCTION CONTRACT AND REFUND GUARANTEE, dated [CLOSING
DATE], is given by [SHIPOWNER], a Marshall Islands corporation and registered
under Part XI of the Hong Kong Companies Ordinance having its principal place of
business at 15th Floor, Tower One, Lippo Centre, 89 Queensway, Hong Kong (the
“Assignor”), in favor of DNB NOR BANK ASA, NEW YORK BRANCH, a bank incorporated
under the laws of the Kingdom of Norway, acting through its New York branch,
with offices at 200 Park Avenue, New York, New York 10166-0396, as Collateral
Agent under the Credit Agreement referred to below (the “Assignee”).  Except as
otherwise defined herein, capitalized terms used herein and defined in the
Credit Agreement (as defined below) shall be used herein as so defined.

RECITALS

A.           The Assignor has entered in the a construction contract dated
_________, 200_  (the “Construction Contract”) with [SHIPYARD], a company
organized and existing under the laws of [        ], as the builder (the
“Shipyard”), providing for the construction and acquisition of the NEWBUILDING
designated as Builder’s Hull No. [    ] (the “Vessel”), as such Construction
Contract may be amended, restated, modified or supplemented from time to time.

B.           The Assignor is the beneficiary of a refund guarantee, either
directly or by virtue of an assignment or novation (the “Refund Guarantee”; the
Construction Contract and the Refund Guarantee shall collectively be referred to
as the “Assigned Contracts” and each separately, an “Assigned Contract”) issued
in connection with the Construction Contract by [            ], as refund
guarantor (the “Refund Guarantor”), as such Refund Guarantee may be amended,
restated, modified or supplemented from time to time.

C.           Genco Shipping & Trading Limited, a Marshall Islands corporation
(the “Borrower”) has entered into a Credit Agreement dated as of __ July, 2007
(as the same may be amended, supplemented or otherwise modified from time to
time, the “Credit Agreement”) among (i) various Lenders referred to therein,
(ii) the Assignee, as Administrative Agent, mandated lead arranger, bookrunner
and Collateral Agent, providing for the making of revolving loans to the
Borrower in the principal amount of up to One Billion Three Hundred Seventy
Seven Million United States Dollars (U.S. $1,377,000,000) (the Lenders, the
Administrative Agent and Collateral Agent, collectively, the “Lender
Creditors”).

D.           The Assignor is a wholly-owned subsidiary of the Borrower.

E.           The Borrower may at any time and from time to time enter into, or
guaranty the obligations of one or more Subsidiary Guarantors or any of their
respective Subsidiaries under, one or more Interest Rate Protection Agreements
or Other Hedging Agreements with respect to the Loan (and/or the Commitments)
with one or more Lenders or any Affiliate thereof (each such Lender or
Affiliate, even if the respective Lender subsequently ceases to be a Lender
under the Credit Agreement for any reason, together with such Lender’s or
Affiliate’s successors and assigns, if any, collectively, the “Other Creditors”
and, together with the Lender Creditors, the “Secured Creditors”).
 
 

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F.           The Assignor has entered into the Guaranty in favor of the Secured
Creditors pursuant to which the Assignor has guaranteed (i) to the Lender
Creditors, all obligations of the Borrower under the Credit Agreement and each
other Credit Document to which the Borrower is a party, and (ii) to each of the
Other Creditors, all obligations of the Borrower under each Interest Rate
Protection Agreement and each Other Hedging Agreement entered into with respect
to the Loan (and/or the Commitments), among other things, its obligations under
the Guaranty.

G.           It is a condition to the obligation of the Lenders to advancing the
Loan in respect of the Vessel to the Borrower under the Credit Agreement that
the Assignor enters into this Assignment as security for its obligations under
the Guaranty.

NOW, THEREFORE, the parties hereto agree as follows:

Section 1.         As security for all amounts due and to become due to the
Secured Creditors under the Guaranty, the Assignor as beneficial owner hereby
grants, sells, conveys, assigns, transfers, mortgages and pledges to the
Assignee, and unto the Assignee’s successors and assigns, all its right, title,
interest, claim and demand in and to, and hereby also grants unto the Assignee a
security interest in and to (i) the Assigned Contracts, (ii) all moneys and
claims for moneys due and to become due to the Assignor under and all claims for
damages arising out of the breach (or payments for variation or termination) of
the Assigned Contracts, including but not limited to the Assignor’s interest in
the deposit being made in connection with the entry into the Assigned Contracts
and any escrow account in respect of such deposit, and (iii) any proceeds of any
of the foregoing.  The Assignor hereby covenants and undertakes to give prompt
notice of this Assignment to the Shipyard in the form of Exhibit A hereto and to
the Refund Guarantor in the form of Exhibit B hereto.

Section 2.          Anything herein contained to the contrary notwithstanding,
the Assignee, or its respective successors and assigns, shall have no obligation
or liability under the Assigned Contracts arising out of this Assignment.

Section 3.          The Assignor hereby constitutes the Assignee, its successors
and assigns, its true and lawful attorney-in-fact, irrevocably, with full power,
in the name of the Assignor or otherwise, upon the occurrence and continuance of
a Default or an Event of Default, to ask, require, demand, receive, compound and
give acquittance for any and all moneys and claims for moneys due and to become
due, property and rights hereby assigned, to endorse any checks or other
instruments or orders in connection therewith and to file any document or to
take any action or institute any proceedings which the Assignee and its
successors and assigns may reasonably deem necessary or advisable in the
premises.

Section 4.          The powers and authorities granted to the Assignee and its
successors or assigns herein have been given for valuable consideration and are
hereby declared to be irrevocable.

Section 5.          The Assignor warrants and represents that it has not
assigned or pledged the rights, title and interest assigned hereunder to anyone
other than the Assignee.  The Assignor hereby covenants that, without the prior
written consent thereto of the Assignee, so long as this Assignment shall remain
in effect, it will not assign or pledge the whole or any part of the rights,
title and interest hereby assigned to anyone other than the Assignee, and it
will not take or omit to take any action, the taking or omission of which might
result in an alteration or impairment of this Assignment, or of any of the
rights created by this Assignment.
 
 
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Section 6.          The Assignor agrees that at any time and from time to time,
upon the written request of the Assignee, the Assignor will promptly and duly
execute and deliver any and all further instruments and documents as the
Assignee may deem desirable in obtaining the full benefits of this Assignment.

Section 7.          THIS ASSIGNMENT AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES HEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND BE GOVERNED BY THE
LAW OF THE STATE OF NEW YORK WITHOUT REGARD TO ITS CONFLICT OF LAWS RULES (OTHER
THAN TITLE 14 OF ARTICLE 5 OF THE GENERAL OBLIGATIONS LAW).  This Assignment
shall not be amended and/or varied except by agreement in writing signed by the
parties hereto.

Section 8.          Any notice, demand or other communication to be given under
or for the purposes of this Assignment shall be made as provided in Section
15.03 of the Credit Agreement or Section 4 of Article IV of the Mortgage.

Section 9.          This Assignment may be executed in any number of
counterparts each of which shall be an original, but all such counterparts shall
together constitute one and the same instrument.

IN WITNESS WHEREOF, the Assignor has duly executed this instrument on the day
and year first above written.

[SHIPOWNER],
as Assignor

By:  __________________
Name: [                         ]
Title: [                           ]
 

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Exhibit A to
CONSTRUCTION CONTRACT
AND REFUND GUARANTEE
ASSIGNMENT

FORM OF NOTICE OF ASSIGNMENT OF CONSTRUCTION CONTRACT

The undersigned, [SHIPOWNER], the owner of the Vessel described in the
assignment attached hereto, hereby gives you notice that (a) by an Assignment of
Construction Contract and Refund Guarantee
dated                            2007, entered into by us with DNB NOR BANK ASA,
NEW YORK BRANCH in its capacity as Collateral Agent for certain Lenders
(hereinafter called the “Assignee”), a copy of which is attached hereto, there
has been assigned by us to the Assignee all of our right, title and interest in
and to (i) the construction contract dated _________, 200__ (the “Construction
Contract”) between us and [SHIPYARD], a company organized and existing under the
laws of [             ], as builder, with respect to the construction and
acquisition of the NEWBUILDING, (ii) all moneys and claims for moneys due and to
become due to the undersigned, whether as indemnities, payments or otherwise,
under, and all claims for damages arising out of any breach of such Construction
Contract and (iii) all proceeds of all of the foregoing, and (b) you are hereby
irrevocably authorized and instructed to pay as from the date hereof all such
aforesaid moneys to the Assignee to the account of the Owner (Account No. []) at
200 Park Avenue, New York, New York 10166-0396, or such other account as the
Assignee may direct.

[SHIPOWNER]
as Owner,

By:  __________________
Name:
Title:

Dated:  _____________

 
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Exhibit B to
CONSTRUCTION CONTRACT
AND REFUND GUARANTEE
ASSIGNMENT

FORM OF NOTICE OF ASSIGNMENT OF REFUND GUARANTEE

The undersigned, [SHIPOWNER], hereby refers you to the refund guarantee no.
___________ dated _________, 200__ (the “Refund Guarantee”) issued by you to us
whereby you have in the manner therein appearing guaranteed to pay to us the sum
of [               ] United States Dollars (US$[       ]) which [SHIPYARD], a
company organized and existing under the laws of [             ], as builder
(the “Shipyard”) may become liable to repay us under a construction contract
dated _________, 200__ with respect to the construction and acquisition of the
NEWBUILDING, subject to and upon the terms and conditions therein contained.

Now we hereby give you notice that:

 
1.
by an Assignment of Construction Contract and Refund Guaranty
dated                            2007, entered into by the undersigned with DNB
NOR BANK ASA, NEW YORK BRANCH in its capacity as Collateral Agent for certain
Lenders (hereinafter called the “Assignee”), a copy of which is attached hereto,
we have assigned to the Assignee all of our right, title and interest in and to
the Refund Guarantee if and when all money or any part thereof shall become
payable by you to us under the Refund Guarantee;

 
2.
we have irrevocably appointed the Assignee as our attorney with full power to
receive the proceeds to be described in our demand, which will be presented for
payment by us in accordance with the terms of the Refund Guarantee, in the event
that the security granted by the Assignment has become enforceable;

 
3.
you are hereby irrevocably authorized and instructed and demanded by us to pay
to the Assignee all sums or any part thereof which you may become due to us
under the Refund Guarantee; and

 
4.
the authority and instructions herein contained cannot be revoked or varied by
us without the consent of the Assignee.

[SHIPOWNER]
as Owner,

By:  __________________
Name:
Title:

Dated:  _____________

 
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