Exhibit 10.1

 

MANAGEMENT AGREEMENT

 

THIS MANAGEMENT AGREEMENT (as the same may be amended or modified from time to
time, this “Agreement”) is dated as of March 15, 2010 and is by and between
Baltic Trading Limited, a Marshall Islands corporation (the “Company”), and
Genco Shipping & Trading Limited, a Marshall Islands corporation (“Genco” or the
“Manager”).

 

RECITALS

 

A. Genco recently formed the Company in anticipation of the Company’s initial
public offering (the “Public Offering”) of shares of its Common Stock, par value
$0.01 per share (“Common Shares”).

 

B. In order to provide the Company with commercial, technical, administrative
and strategic services with respect to Vessels it may acquire and its business,
the Company desires to engage the Manager to provide, directly or indirectly,
such services to the Company, and the Manager desires to provide such services
to the Company, on the terms and subject to the conditions set forth in this
Agreement.

 

NOW, THEREFORE, in consideration of the mutual covenants and premises of the
Parties herein and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the Parties agree as follows:

 

1. DEFINITIONS AND INTERPRETATION

 

1.1 Certain Definitions.  In this Agreement, including the recitals hereto,
unless the context requires otherwise, the following terms shall have the
respective meanings set forth below:

 

“Accounting Referee” has the meaning ascribed to such term in Section 8.3.

 

“Administrative Services” has the meaning ascribed to such term in Section 4.

 

“Affiliates” means, with respect to any Person as at any particular date, any
other Persons that directly or indirectly, through one or more intermediaries,
are Controlled by, Control or are under common Control with the Person in
question, and “Affiliate” means any one of them.

 

“Applicable Laws” means, in respect of any Person, property, transaction or
event, all laws, statutes, ordinances, regulations, municipal by-laws, treaties,
judgments and decrees applicable to that Person, property, transaction or event,
all applicable official directives, rules, consents, approvals, authorizations,
guidelines, orders, codes of practice and policies of any Governmental Authority
having authority over that Person, property, transaction or event and having the
force of law, and all general principles of common law and equity.

 

“Approved Budget” has the meaning ascribed to such term in Section 4.4(c).

 

“Board of Directors” means the board of directors of the Company, as the same
may be constituted from time to time.

 

“Books and Records” means all books of accounts and records, including tax
records, sales and purchase records, Vessel records, computer software,
formulae, business reports, plans and projections and all other documents,
files, correspondence and other information of the Company with respect to the
Vessels or the Business (whether or not in written, printed, electronic or
computer printout form).

 

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“Business” means the Company’s business of owning, operating and/or chartering
or re-chartering Drybulk Carriers to other Persons and any other lawful act or
activity customarily conducted in conjunction therewith.

 

“Business Day” means a day other than a Saturday, Sunday or statutory holiday on
which the banks in New York, New York are required to close.

 

“Cash Available for Distribution” means net income less cash expenditures for
capital items related to the Company’s fleet of Vessels, other than Vessel
acquisitions.

 

“Change of Control” has the meaning ascribed to such term in Section 10.4.

 

“Charter” means a charter party agreement between a Company Group Member and any
Person that relates to any of the Vessels (including any voyage or spot
charters), and “Charters” means all such charter party agreements.

 

“Charterer” means any Person that has entered or enter into, or assumed or
assume the obligations under, by novation or otherwise, a Charter with a Company
Group Member.

 

“Chief Financial Officer” means the chief financial officer of the Company.

 

“Common Shares” has the meaning ascribed to such term in the recitals to this
Agreement.

 

“Class B Shares” means shares of the Company’s Class B Stock, par value $0.01
per share.

 

“Commercial Management Services” has the meaning ascribed to such term in
Section 3.2.

 

“Commercial Management Services Fee” has the meaning ascribed to such term in
Section 8.1.

 

“Company Breach” has the meaning ascribed to such term in Section 10.4(b).

 

“Company Group” means the Company and its Subsidiaries.

 

“Company Group Member” means any member of the Company Group.

 

“Company Indemnified Persons” has the meaning ascribed to such term in
Section 9.4.

 

“Confidential Information” means all nonpublic or proprietary information or
data (including all oral and visual information or data recorded in writing or
in any other medium or by any other method) relating to a Disclosing Party that
is obtained from the Disclosing Party or any third party on the Disclosing
Party’s behalf, at any time before, simultaneously with, or after the execution
of this Agreement; and, without prejudice to the general nature of the foregoing
definition, the term Confidential Information shall include, but not by way of
limitation, (i) information regarding the Disclosing Party’s existing or
proposed operations, business plans, market opportunities, and business affairs
and (ii) any information ascertainable by inspection of Confidential Information
disclosed to the Receiving Party or by the analysis of any materials supplied to
the Receiving.  Notwithstanding the foregoing, Confidential Information shall
not include any information which (x) is public knowledge at the time of
disclosure or which subsequently becomes public knowledge other than as a result
of a breach of this Agreement; (y) the Receiving Party can show was made
available to it by some other Person who had a right to do so and who was not
subject to any obligation of confidentiality or restricted use regarding such
information; or (z) was developed by the Receiving Party independently without
use of any confidential information provided hereunder or by a third party in
breach of its confidentiality obligations.

 

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“Continuing Directors” means, as of any date of determination, any member of the
Board of Directors who was (a) a member of the Board of Directors immediately
after the completion of the Public Offering or (b) nominated for election or
elected to the Board of Directors with the approval of a majority of the
directors then in office who were either directors immediately after the
completion of the Public Offering or whose nomination or election was previously
so approved.

 

“Control” or “Controlled” means, with respect to any Person, the right to elect
or appoint, directly or indirectly, a majority of the directors of such Person
or a majority of the Persons who have the right, including any contractual
right, to manage and direct the business, affairs and operations of such Person,
or the possession of the power to direct or cause the direction of the
management and policies of a Person, whether through ownership of Voting
Securities, by contract, or otherwise.

 

“Costs and Expenses” has the meaning ascribed to such term in Section 8.1.

 

“Consumer Price Index” means the Consumer Price Index for All Urban Consumers
published by the Bureau of Labor Statistics of the United States Department of
Labor, New York, N.Y. — Northeastern N.J. Area, All Items (1982-1984 = 100), or
any successor index thereto, appropriately adjusted. In the event that the
Consumer Price Index is converted to a different standard reference base or
otherwise revised, the determination of amounts provided for in this Agreement
shall be made with the use of such conversion factor, formula or table for
converting the Consumer Price Index as may be published by the Bureau of Labor
Statistics or, if said Bureau shall not publish the same, then with the use of
such conversion factor, formula or table as may be published by
Prentice-Hall, Inc., or any other nationally recognized publisher of similar
statistical information. If the Consumer Price Index ceases to be published, and
there is no successor thereto, such other index as the Manager may reasonably
select shall be substituted for the Consumer Price Index.

 

“Credit Facility” means any credit facility agreement to which any Company Group
Member may be a party from time to time.

 

“Crew” means the master, officers, employees and other crew members of a Vessel.

 

“Crew Employment and Support Expenses” means all Employment Expenses of the Crew
and all expenses of a general nature that are not particularly connected to any
individual member of the Crew or any individual Vessel that are incurred for the
purpose of providing Crew Management Services and, without prejudice to the
generality of the foregoing, shall include the cost of crew standby pay,
training schemes for officers and ratings, cadet training schemes, study pay,
recruitment and interviews.

 

“Crew Insurances” means insurances against crew risks, including death,
sickness, repatriation, injury, shipwreck, unemployment indemnity and loss of
personal effects.

 

“Crew Management Services” has the meaning ascribed to such term in Section 3.3.

 

“Designated Representative” and “Designated Representatives” each have the
meaning ascribed to such terms in Section 11.1.

 

“Disclosing Party” means a Party who has disclosed Confidential Information
hereunder to the other Party or on whose behalf Confidential Information has
been disclosed to the other Party.

 

“Dispute” has the meaning ascribed to such term in Section 11.1.

 

“Dividend” means any cash dividend paid by the Company on all outstanding Common
Stock or Class B Stock, other than any Liquidating Dividends.

 

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“Draft Budget” has the meaning ascribed to such term in Section 4.4(a).

 

“Drybulk Carrier” means a vessel designed to carry bulk cargo, such as coal,
iron ore and grain, that is loaded in bulk and not in bags, packages or
containers.

 

“Drybulk Carrier Assets” means Drybulk Carriers and any assets that are
customarily owned or operated in conjunction with Drybulk Carriers, in each case
that are encompassed within the definition of the Business.

 

“Employment Expenses” means all costs, expenses, liabilities and obligations
related to or incurred in respect of employment, including salaries, fees,
wages, incentive pay, gratuities, bonuses, vacation pay, holiday pay, other paid
leave, overtime, standby pay, sick pay, workers’ compensation contributions or
costs, benefits and related costs, statutory contributions and remittances,
pension plan contributions and costs, recruitment costs, Severance Costs,
payroll and accounting costs, training and education costs, discounts, meals,
accommodation, administrative costs, travel costs, perquisites, relocation
expenses and uniform expenses.

 

“Exchange Act” means the Securities Exchange Act of 1934, as amended.

 

“Existing Ownership Group” means Genco and all Affiliates thereof.

 

“Fiscal Quarter” means a fiscal quarter for the Company or, in the case of the
fiscal quarter ending March 31, 2010, the portion of such fiscal quarter between
the date of this Agreement and the commencement of the next fiscal quarter.

 

“Fiscal Year” means the fiscal year of the Company, being the twelve-month
period ending December 31.

 

“Force Majeure Event” has the meaning ascribed to such term in Section 12.3.

 

“GAAP” means generally accepted accounting principles consistently applied in
the United States.

 

“Governmental Authority” means any domestic or foreign government, including any
federal, provincial, state, territorial or municipal government, any
multinational or supranational organization, any government agency (including
the SEC), any tribunal, labor relations board, commission or stock exchange
(including the New York Stock Exchange), and any other authority or organization
exercising executive, legislative, judicial, regulatory or administrative
functions of, or pertaining to, government.

 

“Initial Expiration Date” means the last day of the Fiscal Quarter that contains
the fifteenth anniversary of the Initiation Date.

 

“Initial Term” has the meaning ascribed to such term in Section 10.1.

 

“Initiation Date” means the date on which the Company takes delivery of its
first Vessel.

 

“Insurances” has the meaning ascribed to such term in Section 3.4.

 

“ISM Code” means the International Safety Management Code for the Safe Operation
of Ships and for Pollution Prevention as adopted by the International Maritime
Organization by resolution A.741(18), as the same may have been or may be
amended or supplemented from time to time.

 

“ISPS Code” means the International Ship and Port Facility Security Code adopted
by the International Maritime Organization, as the same may have been or may be
amended or supplemented from time to time.

 

“Legal Action” means any action, claim, complaint, demand, suit, judgment,
investigation or proceeding, pending or threatened, by any Person or before any
Governmental Authority.

 

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“Lenders” means the lenders, facility agent, security trustee, swap banks, swap
agent or other financial institution contemplated by any Credit Facility.

 

“License” and “Licenses” each have the meaning ascribed to such terms in
Section 3.1(p).

 

“Liquidating Dividend” means any dividend or other distribution in respect of
any Common Stock or Class B Stock paid in connection with the liquidation,
dissolution, bankruptcy or winding up of the Company, any merger of the Company
or any sale or other conveyance of all or substantially all the assets of the
Company.

 

“Losses” means losses, expenses, costs, liabilities and damages, excluding lost
profits and consequential damages, but including interest charges, penalties,
fines and monetary sanctions.

 

“Management Services” means, collectively, the Technical Services, the
Administrative Services and the Strategic Services.

 

“Management Fees” has the meaning ascribed to such term in Section 8.1.

 

“Manager Breach” has the meaning ascribed to such term in Section 10.3(a).

 

“Manager Indemnified Persons” has the meaning ascribed to such term in
Section 9.3.

 

“Manager Misconduct” has the meaning ascribed to such term in Section 9.1(a).

 

“Manager’s Personnel” means all individuals who are employed by or have entered
into consulting arrangements with the Manager or any subcontractor under
Section 2.3, other than the Crew.

 

“Mediator’s Report” has the meaning ascribed to such term in Section 11.2(c).

 

“Omnibus Agreement” means the Omnibus Agreement, dated as of March 15, 2010,
between Genco and the Company, as the same may be amended or modified from time
to time.

 

“Other Financing Agreements” has the meaning ascribed to such term in
Section 4.2(c).

 

“Parties” means the Company and the Manager.

 

“Person” means an individual, corporation, limited liability company,
partnership, joint venture, trust or trustee, unincorporated organization,
association, Governmental Authority or other entity.

 

“Pre-delivery Purchases and Expenses” has the meaning ascribed to such term in
Section 5.3.

 

“Pre-delivery Services” has the meaning ascribed to such term in Section 5.2.

 

“Public Offering” has the meaning ascribed to such term in the recitals to this
Agreement.

 

“President” means the chief executive officer of the Company.

 

“Questioned Items” has the meaning ascribed to such term in Section 4.4(b).

 

“Receiving Party” means a Party to whom Confidential Information of a Disclosing
Party has been disclosed hereunder.

 

“Renewal Term” has the meaning ascribed to such term in Section 10.2.

 

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“SEC” means the United States Securities and Exchange Commission.

 

“Severance Costs” means the termination or severance liabilities, costs and
expenses that employers are legally obliged to provide or pay to or in respect
of their employees, or the compensation or damages owed in lieu of such
liabilities, costs and expenses, as a result of the termination of any
employment.

 

“STCW 95” means the International Convention on Standards of Training,
Certification and Watchkeeping to Seafarers, 1978, as amended in 1995 or any
subsequent amendment thereto.

 

“Stores and Equipment” means the stores, spares, lubricating oil, supplies and
equipment that customarily are considered part of a Drybulk Carrier for which a
buyer would ordinarily reimburse a seller on the sale of such Drybulk Carrier,
and does not include consumables that are not of incremental value to the
Drybulk Carrier.

 

“Strategic Opportunity” has the meaning ascribed to such term in Section 5.1.

 

“Strategic Services” has the meaning ascribed to such term in Section 5.

 

“Subsidiary” means, with respect to any Person, (a) a corporation of which more
than 50% of the voting power of shares entitled (without regard to the
occurrence of any contingency) to vote in the election of directors or other
governing body of such corporation is owned, directly or indirectly, at the date
of determination, by such Person, by one or more Persons Controlled by such
Person or a combination thereof, (b) a partnership (whether general or limited)
in which such Person or a Person Controlled by such Person is, at the date of
determination, a general or limited partner of such partnership, but only if
more than 50% of the partnership interests of such partnership (considering all
of the partnership interests of the partnership as a single class) is owned,
directly or indirectly, at the date of determination, by such Person, one or
more Persons Controlled by such Person, or a combination thereof, or (c) any
other Person (other than a corporation or a partnership) in which such Person,
one or more Persons Controlled by such Person, or a combination thereof,
directly or indirectly, at the date of determination, has (i) at least a
majority ownership interest or (ii) the power to elect or direct the election of
a majority of the directors or other governing body of such Person.

 

“Technical Services” has the meaning ascribed to such term in Section 3.

 

“Term” means the Initial Term and any Renewal Term, in each case subject to any
early termination of this Agreement as permitted herein.

 

“Termination Payment” means an amount of cash equal to five times (a) aggregate
Management Fees for the past five completed years of the Term as of the date of
termination or such lesser number of completed years as has transpired divided
by (b) five or such lesser number of completed years as has transpired; except
that if this Agreement terminates in the first year of the Term, the Termination
Payment shall equal five times $1,916,250, or $9,581,240.

 

“Vessels” means the Drybulk Carriers owned by the Company or any of its
Subsidiaries from time to time as set out in Schedule A, as the same may be
amended from time to time in accordance with Section 2.8.

 

“Voting Securities” means securities of all classes of a Person entitling the
holders thereof to vote on a regular basis in the election of members of the
board of directors or other governing body of such Person.

 

1.2 Construction.  In this Agreement, unless the context requires otherwise:

 

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(a) references to laws and regulations refer to such laws and regulations as
they may be amended from time to time, and references to particular provisions
of a law or regulation include any corresponding provisions of any succeeding
law or regulation;

 

(b) references to money refer to legal currency of the United States;

 

(c) “including” means “including, without limitation,” whether or not so
expressed;

 

(d) words importing the singular include the plural and vice versa, and words
importing gender include all genders; and

 

(e) a reference to an “approval,” “authorization,” “consent,” “notice” or
“agreement” means an approval, authorization, consent, notice or agreement, as
the case may be, in writing.

 

1.3 Headings.  All article or section headings in this Agreement are for
convenience only and shall not be deemed to control or affect the meaning or
construction of any of the provisions hereof.

 

2. ENGAGEMENT OF MANAGER

 

2.1 Engagement.  The Company hereby engages the Manager to provide, upon the
Company’s request, the Management Services specified herein and, subject to the
terms hereof, to manage each Vessel for and on behalf of the relevant Company
Group Member, and the Manager hereby accepts such engagement, all in accordance
with the terms of this Agreement. The Company and the Manager each acknowledge
that to the extent set out in this Agreement, the Manager is acting solely on
behalf of, as agent of and for the account of, the relevant Company Group
Member. The Manager shall advise Persons with whom it deals on behalf of the
relevant Company Group Member that it is conducting such business for and on
behalf of such Company Group Member.

 

2.2 Powers and Duties of the Manager.  The Manager has the power and authority
to take such actions on its own behalf or on behalf of the relevant Company
Group Member as it from time to time considers necessary or appropriate to
enable it to perform its obligations under this Agreement, subject to customary
oversight and supervision of the Company, its Board of Directors and its
executive officers. The Manager shall use its reasonable best efforts to provide
the Management Services hereunder in a commercially reasonable manner and in
accordance with customary ship management practice and with the care, diligence
and skill that a prudent manager of Vessels such as the Vessels would possess
and exercise, except that the Manager in the performance of its management
responsibilities under this Agreement may have regard to its overall
responsibility in relation to all Vessels as may from time to time be entrusted
to its management and in particular, but without prejudice to the generality of
the foregoing, the Manager may allocate available supplies, manpower and
services in such manner as in the prevailing circumstances the Manager, acting
reasonably, considers to be fair and reasonable.

 

2.3 Ability to Subcontract.  The Manager may subcontract any of its duties and
obligations hereunder to provide Management Services to any of its Affiliates
without the consent of the Company and may subcontract its duties and
obligations hereunder to provide Management Services to Persons that are not
Affiliates with the prior written consent of the Company, not to be unreasonably
withheld; provided, however, that the Manager may subcontract with any
independent technical manager that the Manager has previously engaged for
management of its own Vessels without the further consent of the Company.  In
the event of any subcontract by the Manager, the Manager shall promptly notify
the Company thereof and shall remain fully liable for the due performance of its
obligations under this Agreement.  To the extent the Manager subcontracts any
Management Services hereunder, the Company shall directly pay the relevant
subcontractor all fees, costs, reimbursements, and other expenses payable to
such subcontractor as the Manager may direct.

 

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2.4 Outside Activities.  The Company acknowledges that the Manager and its
Affiliates may have business interests and engage in business activities in
addition to those relating to the Company Group, for their own respective
accounts and for the accounts of other Persons. The Manager and its Affiliates
may undertake activities that compete with the activities of the Company Group.

 

2.5 Exclusive Appointment.  The Company acknowledges that the appointment of the
Manager hereunder is an exclusive appointment for the Term. The Company shall
not appoint other managers with respect to the Vessels or the Business during
the Term, except in circumstances in which it is necessary to do so in order to
comply with Applicable Law or as otherwise agreed by the Manager in writing.
Notwithstanding the foregoing, this Section 2.5 shall not prohibit the Company
from having its own employees perform Management Services.

 

2.6 Authority of the Parties.  Each Party represents to the other that it is
duly authorized with full power and authority to execute, deliver and perform
its obligations under this Agreement. The Company represents that the engagement
of the Manager has been duly authorized by the Company and is in accordance with
all governing documents of the Company.

 

2.7 Inspection of Books and Records.  At all reasonable times and on reasonable
notice, any Person authorized by the Company may inspect, examine, copy and
audit the Books and Records of the Company kept by the Manager pursuant to this
Agreement.

 

2.8 Changes to Vessels Subject to this Agreement.  A list of Vessels subject to
this Agreement as of the date hereof is set forth on Schedule A attached hereto.
Unless otherwise agreed to by the Parties, all Drybulk Carriers that the Company
may add to its fleet after the date hereof shall become subject to the
engagement under this Agreement.  The Company, with reasonable notice to the
Manager, may remove any Vessel from the engagement under this Agreement,
provided that the Manager is being engaged to manage such Vessel under a
separate agreement with the Company or the Manager otherwise consents to such
removal. Notwithstanding the provisions of this Section 2.8, a Vessel shall
automatically be removed from engagement under this Agreement upon a sale or,
unless otherwise agreed to by the Parties, a total loss of such Vessel, and the
Company may sell any Vessel subject to the engagement under this Agreement at
any time in its sole discretion. Upon any addition of a Vessel to this
engagement or any removal of a Vessel from this engagement, the Parties shall
amend Schedule A to reflect such change.

 

3. TECHNICAL SERVICES

 

Subject to Section 9.2, the Manager shall, at its own expense, provide to the
Company the services described in this Section 3 (collectively, the “Technical
Services”).

 

3.1 Technical Vessel Management Services.  Commencing with the acquisition of
each Vessel by any Company Group Member, the Manager shall provide all usual and
customary Vessel technical management services with respect to the operation of
such Vessel, including the following:

 

(a) supervising the day-to-day operation, maintenance, safety and general
efficiency of the Vessel to ensure the seaworthiness and maintenance condition
of the Vessel;

 

(b) arranging for and supervising general and routine repairs, alterations and
maintenance of the Vessel;

 

(c) purchasing the necessary stores, spares, lubricating oil, supplies and
equipment (other than such equipment as is covered by Section 9.2) for the
operation of such Vessel;

 

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(d) appointing such surveyors, supervisors, technical consultants and other
support for the Vessel on behalf of the relevant Company Group Member as the
Manager may consider from time to time to be necessary;

 

(e) providing technical and shore-side support for the Vessel and attending to
all other technical matters necessary for the operation of the Vessel;

 

(f) handling of the Vessel while in ports or transiting canals, either directly
or by use of Vessel agents, unless otherwise handled by the Charterer;

 

(g) procuring and arranging for port entrance and clearance, pilots, Vessel
agents, consular approvals, and other services necessary or desirable for the
management and safe operation of the Vessel, unless otherwise procured or
arranged by the Charterer;

 

(h) preparing, issuing (or causing to be issued) to shippers customary freight
contracts, cargo receipts and bills of lading, unless prepared, issued or
arranged for by the Charterer;

 

(i) performing all usual and customary duties relating to the loading and
discharging of cargoes at all ports, unless performed by the Charterer;

 

(j) arranging for the prompt dispatch of the Vessel from loading and discharging
ports in accordance with the instructions of the Charterer and for transit
through canals;

 

(k) subject to Section 4.5(b), arranging for employment of counsel and the
investigation, follow-up and negotiation of the settlement of all claims arising
in connection with the operation of the Vessel;

 

(l) coordinating the Company’s payment of all ordinary charges incurred in
connection with the management of the Vessel, including canal tolls, port
charges, any amounts due to any Governmental Authority with respect to the Crew
and all duties and taxes in respect of cargo or freight (whether levied against
the Vessel or the Company), unless otherwise paid by the Charterer;

 

(m) promptly upon the Company’s request, reporting to the Company the Vessel’s
movement, position at sea, arrival and departure dates, and major casualties and
damages received or caused by the Vessel;

 

(n) informing the Company promptly of any release or discharge of oil or other
hazardous material not in compliance with Applicable Laws;

 

(o) upon the Company’s request, providing the Company with a copy of any Vessel
inspection reports, valuations, surveys, insurance claims and other similar
reports prepared by ship brokers, valuators, surveyors, classification societies
or insurers; and

 

(p) arranging for any and all licenses, permits, franchises, registrations and
similar authorizations of any Governmental Authority that are necessary and used
in the operation of the Vessel, the cost of which shall be paid directly by the
Company (each a “License” and, collectively, the “Licenses”).

 

3.2 Commercial Management Services.  Commencing with the acquisition of each
Vessel by any Company Group Member and subject to Section 2.5, the Manager shall
provide all usual and customary commercial management services with respect to
such Vessel, including the following (collectively, the “Commercial Management
Services”):

 

(a) marketing and promoting the Vessel;

 

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(b) identifying, negotiating and securing Charterers and Charters and other
employment for the Vessels for and on behalf of the relevant Company Group
Member;

 

(c) monitoring proper payment to any Company Group Member or its nominee of all
hire and freight revenues or other moneys of whatsoever nature arising out of
the employment of the Vessel or otherwise in connection with the Vessel to which
the Company or any Company Group Member may be entitled;

 

(d) providing voyage estimates and accounts and calculating and invoicing of
hire, freights, demurrage and dispatch moneys due from or due to the Charterers
of the Vessel;

 

(e) administering the Charters; and

 

(f) taking all other actions relating to commercial management of the Vessel as
the Manager deems necessary to fulfill its obligations under this Agreement.

 

3.3 Crew Management Services.  Commencing with or, to the extent reasonably
necessary for the provision of the Crew Management Services in an efficient
manner, prior to the acquisition of each Vessel by a Company Group Member, the
Manager shall provide all usual and customary crew management services in
respect of such Vessel and shall manage all aspects of the employment of the
Crew, including the following (collectively, the “Crew Management Services”):

 

(a) procuring, supervising and managing suitably qualified Crew, which in the
opinion of the Manager is required for the Vessel in accordance with the STCW 95
requirements;

 

(b) recruiting, selecting, hiring and engaging the Vessel’s Crew, and arranging
and paying, at its own expense, all compensation and administering payroll
arrangements, pensions and other benefits and insurance for the Crew (including
processing all claims);

 

(c) ensuring that the Applicable Laws of the flag of the Vessel and all places
where the Vessel trades are satisfied in respect of manning levels, rank,
qualification and certification of the Crew and employment regulations,
including any statutory withholding tax requirements and social insurance
requirements;

 

(d) ensuring that all members of the Crew have passed a medical examination with
a qualified doctor certifying that they are fit for the duties for which they
are engaged and are in possession of valid medical certificates issued in
accordance with appropriate flag state requirements and, in the absence of
applicable flag state requirements, the medical certificate shall be dated not
more than three months prior to the respective Crew members leaving their
country of domicile and shall be maintained for the duration of their service on
board the Vessel;

 

(e) ensuring that the Crew have command of the English language at a sufficient
standard to enable them to perform their duties effectively and safely;

 

(f) arranging for all transportation (including repatriation), board and lodging
for the Crew as and when required at rates and types of accommodations as are
customary in the industry;

 

(g) attending to and supervising the training, discipline, discharge and other
terms and conditions of employment of the Crew;

 

(h) conducting all union negotiations for and on behalf of the Company pursuant
to Section 4.5(c);

 

(i) administering the Company’s and the Manager’s drug and alcohol policies in
respect of the Crew;

 

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(j) ensuring that any concerns of the Charterer with respect to the master or
any of the officers or other members of the Crew are appropriately investigated
in a timely manner, communicating the results of such investigations to the
Charterer and the Company and, if such concerns are well-founded, ensuring that
any appropriate remedial actions are promptly taken;

 

(k) keeping and maintaining full and complete records of any labor agreements
that may be entered into with the Crew and reporting to the Company reasonably
promptly after notice or knowledge thereof is received of any change or proposed
change in labor agreements or other regulations relating to the Crew;

 

(l) negotiating the settlement of all wages with the Crew during the course of
and upon termination of their employment;

 

(m) handling all details and negotiating the settlement of any and all claims of
the Crew including those arising out of accidents, sickness, death, loss of
personal effects, disputes under articles or contracts of enlistment, policies
of insurance and fines;

 

(n) keeping and maintaining all administrative and financial records relating to
the Crew as required by Applicable Law and any applicable labor or collective
agreements of the Company or the Manager, and promptly rendering to the Company
any and all reports when, as and in such form as reasonably requested by the
Company; and

 

(o) performing any other function in connection with the Crew as may be
reasonably requested by the Company from time to time.

 

3.4 Insurance. The Manager shall arrange for insurance for each Vessel for and
on behalf of the relevant Company Group Member against physical damage, total
loss, third party liability and other risks normally insured against in
accordance with industry practice, including the following (collectively with
any additional insurances required under any Credit Facility, the “Insurances”):

 

(a) usual hull and machinery marine risks (including crew negligence) and excess
liabilities;

 

(b) protection and indemnity risks (including pollution risks and Crew
Insurances); and

 

(c) war risks (including protection and indemnity and crew risks);

 

each in accordance with the customary practice of prudent owners of Vessels of a
similar type to each Vessel, with insurance companies, underwriters or
associations in amounts and on terms that are in accordance with industry
practice, and in any event, are no less than the market value of the Vessel (and
in the case of protection and indemnity coverage, entered for the Vessel’s full
gross tonnage). Notwithstanding the foregoing, the Manager shall not arrange for
off-hire insurance for the Vessels unless requested by the Company.

 

The Manager shall arrange for and on behalf of the Company any such additional
insurance required under any Credit Facility, including, as applicable,
arranging for any of the Lenders thereto being named as “loss payee” or
“additional insured” in accordance with the terms of any Credit Facility.

 

The relevant Company Group Member shall directly pay the relevant insurer all
premiums and calls on the Insurances promptly and in any event by their due
date. The Manager shall cooperate with the Company’s insurers and underwriters
with respect to the investigation or settlement of claims by the relevant
Company Group Member or any third party under the Insurances, including taking
necessary

 

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steps to have repairs contemplated in Section 9.2(a) covered by the applicable
insurance policy or policies.

 

3.5 Drydocking, Repairs and Improvements.  Subject to Section 9.2, the Manager
shall arrange for and supervise the drydockings, repairs, alterations and
maintenance of each Vessel to the standards required to ensure that such Vessel
will comply, in all material respects, with the laws of the flag of such Vessel
and of the jurisdictions where such Vessel trades and all requirements and
recommendations of the applicable classification society.  The Company shall
directly pay the relevant third party providing drydocking , repair, alteration
or maintenance services all fees and costs for the same.

 

3.6 Regulatory Compliance Services.  The Manager shall operate and maintain the
Vessels, and take all actions necessary to ensure that each Vessel is, in
compliance with all Applicable Laws, including the laws of the applicable flag
each Vessel may bear, the Applicable Laws of the countries to which the Vessels
trade and with the requirements of the relevant classification society, the ISM
Code and the ISPS Code.

 

4. ADMINISTRATIVE SERVICES

 

The Manager shall, at its own expense, provide to the Company the services
described in this Section 4 (collectively, the “Administrative Services”).

 

4.1 Accounting and Records.  The Manager shall, on behalf of the Company,
establish an accounting system, including the development, implementation,
maintenance and monitoring of internal control over financial reporting and
disclosure controls and procedures, and maintain Books and Records, with such
modifications as may be necessary to comply with Applicable Laws. The Books and
Records shall contain particulars of receipts and disbursements relating to the
Company’s assets and liabilities and shall be kept pursuant to normal commercial
practices that will permit financial statements to be prepared for the Company
in accordance with GAAP. The Books and Records shall be the property of the
Company but shall be kept at the Manager’s primary office or such other place as
the Company and the Manager may mutually agree. Upon expiration or termination
of this Agreement, all of the Books and Records shall be provided to the Company
or a new manager pursuant to Section 10.5(e).

 

4.2 Reporting Requirements.  The Manager shall prepare and deliver to the
President and the Chief Financial Officer the following reports, which the
Manager shall use its reasonable best efforts to prepare and deliver within the
time periods specified below or, if not so specified, within the time period
requested by the relevant party:

 

(a) a quarterly report to be delivered within 45 days of the end of each Fiscal
Quarter setting out the interim financial results of the Company for such
quarter and for the applicable Fiscal Year through the end of such Fiscal
Quarter;

 

(b) a draft of the reports, certificates, documents and other information
required under any Credit Facility and any other financing arrangements of the
Company (“Other Financing Agreements”) to be delivered at least two Business
Days prior to their required delivery to the Lenders or lenders under Other
Financing Agreements;

 

(c) as and when requested by the Board of Directors, the President or the Chief
Financial Officer, draft reports regarding financial and other information
required in connection with Applicable Laws (including annual and other reports
that may be required to be filed under the Exchange Act and all other Applicable
Laws); and

 

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(d) as and when reasonably requested by the Company from time to time, such
other reports with respect to financial and other information of the Company.

 

4.3 Financial Statements and Tax Returns.  At the instruction of the Chief
Financial Officer, the Manager shall prepare and deliver for review by the Chief
Financial Officer and the Audit Committee of the Board of Directors the
following which the Manager shall use its reasonable best efforts to prepare and
deliver within the time periods specified below or, if not so specified, within
the time period requested by the relevant party:

 

(a) within 30 days of the end of each Fiscal Quarter, unaudited financial
statements of the Company for such Fiscal Quarter, to be reviewed by the
external auditors of the Company, prepared in accordance with GAAP and the
rules and regulations of the SEC, on a consolidated basis with all Subsidiaries
of the Company;

 

(b) within 40 days of the end of each Fiscal Year, financial statements of the
Company for such Fiscal Year, to be audited by the external auditors of the
Company, prepared in accordance with GAAP and the rules and regulations of the
SEC, on a consolidated basis with all Subsidiaries of the Company; and

 

(c) tax returns for the Company and all of its Subsidiaries required to be filed
by Applicable Laws.

 

Notwithstanding the foregoing, in the event that the Company’s reporting
obligations are accelerated under the Exchange Act beyond what such obligations
are at the time of the Public Offering, the Manager shall use its reasonable
best efforts to provide to the Company the financial statements referred to in
clauses (a) and (b) above within such periods as shall be required for the
Company to comply with any reporting requirements under the Exchange Act or
other similar applicable laws and regulations.

 

In addition, the Manager shall attend to the time calculation and payment of all
taxes payable by the Company. At the instruction of the Chief Financial Officer,
the Manager shall cause the Company’s external accountants to review the
Company’s unaudited financial statements, audit the Company’s annual financial
statements and finalize tax returns. The Manager shall make available to the
Company’s accountants the relevant Books and Records for the Company and shall
assist the accountants in their duties.

 

4.4 Budgets and Corporate Planning.

 

(a) Draft Budgets

 

On or before December 15 of each year, the Manager, in consultation with the
President and the Chief Financial Officer, shall prepare and submit to the Board
of Directors a detailed draft budget for the next Fiscal Year in a format
acceptable to the Board of Directors and generally used by the Manager, which
shall include: (1) a statement of estimated revenue and expenses, including
Costs and Expenses; and (2) a proposed budget for capital expenditures, repairs
and alterations, including proposed expenditures in respect of drydockings,
together with an analysis as to when and why such expenditures, repairs and
alterations may be required (the “Draft Budget”).

 

(b) Process for Finalizing the Draft Budget.

 

For a period of seven (7) days after receipt of the Draft Budget, the Board of
Directors may request further details and submit written comments on the Draft
Budget. If, after reviewing the Draft Budget, the Company does not agree with
any term thereof, the Company shall, within the same seven (7) day period, give
the Manager notice of such disagreements and terms (the “Questioned Items”) and
a proposal for resolution of each such Questioned Item. The Company and the
Manager shall endeavor to resolve any

 

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such differences between them with respect to the Questioned Items. In resolving
any Questioned Item, the Company and the Manager shall consider, among other
things, the Company’s obligations under any relevant Charters, Credit Facility,
or Other Financing Agreement.

 

(c) Approved Budget.

 

The Manager shall use its commercially reasonable efforts to prepare and deliver
to the Company a revised budget that has been approved by the Board of Directors
(the “Approved Budget”) by December 31 of the preceding Fiscal Year. However,
the Company acknowledges that the Approved Budget is only an estimate of the
performance of the Vessels and the Manager makes no assurance, representation or
warranty that the actual performance of the Vessels in the applicable Fiscal
Year will correspond to the estimates contained in the Approved Budget for such
Fiscal Year. The Parties acknowledge that any projections contained in the
Approved Budget are subject to and may be affected by changes in financial,
economic and other conditions and circumstances beyond the control of the
Parties.

 

(d) Amendments to Approved Budget.

 

The Manager may, from time to time, in any Fiscal Year propose amendments to the
Approved Budget upon at least fifteen (15) days prior notice to the Company, in
which event the Company shall have the right to approve the amendments in
accordance with the process set out in Section 4.4(b), with the relevant time
periods being amended accordingly. Whenever, due to circumstances beyond the
reasonable control of the Manager, emergency expenditures are required to ensure
that any Vessels are operated and maintained as required under any applicable
Charters, the Manager may make such emergency expenditures and reasonably
request prompt reimbursement thereof, to the extent that such items are the
responsibility of the Company, including pursuant to Sections 5.4 and 9.2, even
if such expenditures are not included or reflected in the Approved Budget.

 

4.5 Legal and Securities Compliance Services.

 

(a) Responsibilities of the Manager.

 

The Manager shall assist the Company with the following items, whether or not
related to any of the Vessels:

 

(i) compliance with all Applicable Laws, including all relevant securities laws
and the rules and regulations of the SEC, the New York Stock Exchange and any
other securities exchange upon which the Company’s securities are listed;

 

(ii) arranging for the provision of advisory services to the Company with
respect to the Company’s obligations under applicable securities laws in the
United States and disclosure and reporting obligations under applicable
securities laws, including the preparation for review, approval and filing by
the Company of reports and other documents with the SEC and all other applicable
regulatory authorities;

 

(iii) maintaining the Company’s corporate existence and good standing in all
necessary jurisdictions and assisting in all other corporate and regulatory
compliance matters;

 

(iv) conducting investor relations functions on behalf of the Company; and

 

(v) adjusting and negotiating settlements, with or on behalf of claimants or
underwriters, of any claim, damages for which are recoverable under insurance
policies.

 

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(b) Administration and Settlement of Legal Actions.

 

If any Legal Action is commenced against or is required to be commenced in favor
of any Company Group Member or any of the Vessels, the Manager shall arrange for
the commencement or defense of such Legal Action, as the case may be, in the
name of, on behalf of and at the expense of the Company Group Member, including
retaining and instructing legal counsel, investigating the substance of the
Legal Action and entering pleadings with respect to the Legal Action. The
Manager shall assist the Company in administering and supervising any such Legal
Actions and shall keep the Company advised of the status thereof. The Manager
may settle any Legal Action on behalf of a Company Group Member where the amount
of settlement is less than $500,000 with the approval of the President or the
Chief Financial Officer and, in excess of such amount, with the approval of the
Board of Directors.

 

(c) Labor Relations Proceedings.

 

For Legal Actions in favor of or against any Company Group Member that relate to
labor relations or employment proceedings, strikes or collective bargaining, the
Manager shall represent the Company Group Member in any such labor relations or
employment proceedings and shall undertake any labor relations or employment
negotiations in respect of any of the Vessels or any Company Group Member on
behalf of such Company Group Member, should such representation or negotiations
be required, with such labor organization or other Person that becomes lawfully
entitled to represent the Crew. The Manager shall keep the Company advised of
the progress of any such labor relations proceedings or negotiations. The
Manager may enter into collective bargaining agreements and other labor or
employment agreements and any material amendments thereto; provided, however,
that such agreements and amendments must be approved by the Board of Directors
if the terms and conditions of any such agreements or amendments are
inconsistent, in a material and adverse way to the Company Group Member, with
other collective bargaining agreements concerning or in respect of the Crew.

 

(d) Interaction with Regulatory Authorities.

 

Notwithstanding anything in this Section 4 or otherwise, the Manager shall not
act for or on behalf of the Company in its relationships with regulatory
authorities except to the extent specifically authorized by the Company from
time to time.

 

4.6 Bank Accounts.

 

(a) Administration by Manager.

 

The Manager shall oversee banking services for the Company and shall establish
in the name of the Company an operating account, a retention account and such
other accounts with such financial institutions as the Company may request. The
Manager shall administer and manage all of the Company’s cash and accounts,
including making any deposits and withdrawals reasonably necessary for the
management of its business and day-to-day operations. The Manager shall promptly
deposit all moneys payable to the Company and received by the Manager into a
bank account held in the name of the Company.

 

(b) Payments from Operating Account.

 

The Company shall ensure that all charter hire associated with each Charter is
paid by the applicable Charterer into the operating account. Unless otherwise
instructed by the Company, the Manager shall instruct the financial institutions
at which the accounts have been established to pay from the operating account,
as and when required, amounts payable under any Credit Facility or Other
Financing Agreement.

 

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4.7 License.  The Manager shall procure, and the Company shall enter into, a
license agreement that permits the Company to use the “Genco” name and trademark
in connection with its business.

 

4.8 Other Administrative Services.

 

The Manager shall:

 

(a) develop, maintain and monitor internal audit controls, disclosure controls
and information technology for the Company;

 

(b) assist with arranging board meetings and preparing board and committee
meeting materials, including, as applicable, agendas, discussion papers,
analyses and reports;

 

(c) prepare and provide such reports and accounting information so as to permit
the Board of Directors to determine the amount of the Company’s Cash Available
for Distribution and Dividends to the Company’s stockholders, and to assist the
Company in making arrangements with the Company’s transfer agent for the payment
of Dividends to the stockholders;

 

(d) obtain, on behalf of the Company, general insurance, director and officer
liability insurance and other insurance of the Company not related to the
Vessels that would normally be obtained for a company in a similar business to
that of the Company;

 

(e) administer payroll services, benefits and directors fees, as applicable, for
the Crew, the President and the Chief Financial Officer and any other employee,
officer or director of the Company;

 

(f) provide office space and office equipment for personnel of the Company at
the location of the Manager or as otherwise reasonably designated by the
Company, and clerical, secretarial, accounting and administrative assistance as
may be reasonably necessary;

 

(g) provide all administrative services required in connection with any Credit
Facility or Other Financing Agreement;

 

(h) negotiate loan and credit terms with lenders in the ordinary course and
monitor and maintain compliance therewith;

 

(i) negotiate and arrange for interest rate swap agreements, foreign currency
contracts and forward exchange contracts;

 

(j) monitor the performance of investment managers;

 

(k) at the request and under the direction of the Company, handle all
administrative and clerical matters in respect of (i) the call and arrangement
of all annual and special meetings of stockholders, (ii) the preparation of all
materials (including notices of meetings and proxy or similar materials) in
respect thereof and (iii) the submission of all such materials to the Company in
sufficient time prior to the dates upon which they must be mailed, filed or
otherwise relied upon so that the Company has full opportunity to review,
approve, execute and return them to the Manager for filing or mailing or other
disposition as the Company may require or direct;

 

(l) provide, at the request and under the direction of the Company, such
communications to the transfer agent for the Company as may be necessary or
desirable;

 

(m) make recommendations to the Company for the appointment of auditors,
accountants, legal counsel and other accounting, financial or legal advisers,
and technical, commercial, marketing or other

 

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independent experts; provided, however, that nothing herein shall permit the
Manager to engage any such adviser or expert for the Company without the
Company’s specific approval;

 

(n) attend to all matters necessary for any reorganization, bankruptcy or
insolvency petitions or proceedings, liquidation, dissolution or winding up of
the Company;

 

(o) attend to all other administrative matters necessary to ensure the
professional management of the Company’s business or as reasonably requested by
the Company from time to time.

 

5. STRATEGIC SERVICES

 

The Manager shall, at its own expense and upon the Company’s reasonable request,
provide to the Company the services described in this Section 5 (collectively,
the “Strategic Services”).

 

5.1 Acquisitions, Charter Parties and Finance.  The Manager shall provide
strategic, corporate planning, business development and advisory services to the
Company, including the following:

 

(a) providing general strategic planning services and implementing corporate
strategy, including developing acquisition and divestiture strategies;

 

(b) identifying, negotiating and securing opportunities for the Company to
acquire or to construct Drybulk Carriers, and negotiating and carrying out the
purchase of existing and any newbuilding Drybulk Carriers;

 

(c) (i) identifying, negotiating and securing opportunities for the Company to
acquire or merge with companies or other Persons that own or operate Drybulk
Carriers or are otherwise involved in the drybulk shipping industry,
(ii) negotiating and carrying out the purchase of such companies or other
Persons, and (iii) working to integrate any such acquired businesses;

 

(d) maintaining and managing relationships between the Company and the
Charterers and potential charterers, shipbuilders, insurers, Lenders and
potential financiers of the Company and other shipping industry participants;

 

(e) arranging, negotiating and procuring pre-delivery and post-delivery
financing or refinancing for the construction of any Drybulk Carriers and
financing or refinancing for the acquisition of existing Drybulk Carriers;

 

(f) identifying, negotiating and implementing potential divestitures or
dispositions of any of the Vessels and any other of the Company’s Drybulk
Carrier Assets, and evaluating and recommending the sale of all or any part of
the Business;

 

(g) identifying, investigating and implementing tax planning, leasing or other
tax savings initiatives;

 

(h) assisting the Company in connection with any future offerings of Common
Shares or other securities the Company may determine is desirable, all under the
direction and supervision of the Board of Directors, the President, and the
Chief Financial Officer;

 

(i) subject to the oversight of the Board of Directors and supervision of the
President and the Chief Financial Officer, generally undertaking the day-to-day
management of the Business; and

 

(j) providing such other strategic, corporate planning, business development and
advisory services as the Company may reasonably request from time to time.

 

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If, pursuant to the provision of Strategic Services, the Manager identifies a
potential opportunity for the Company (“Strategic Opportunity”) and subject to
allocations of corporate opportunities to Genco pursuant to the Company’s
Articles of Incorporation and the Omnibus Agreement, (i) the Manager shall
present the Strategic Opportunity to the President and the Chief Financial
Officer for further consideration and presentation to the Board of Directors,
and (ii) the Board of Directors or an appropriate committee thereof shall
approve or reject the Strategic Opportunity.

 

5.2 Pre-delivery Services.  For the acquisition of any Vessel, the Manager shall
oversee and supervise, in all material respects, the construction of any
newbuilding Vessel or the acquisition of any existing Vessel to be purchased and
made subject to this Agreement, as the case may be, prior to its delivery,
including the following (collectively, the “Pre-delivery Services”), as
applicable:

 

(a) negotiating the shipbuilding contract and specifications and related
documentation;

 

(b) attending to plan approval for the design of the newbuilding Drybulk
Carrier;

 

(c) arranging for and supervising alterations and changes to the newbuilding
Drybulk Carrier;

 

(d) liaising with the ship builder, supervising the ship builder’s progress and
overseeing construction to ensure the ship builder is constructing the
newbuilding Drybulk Carrier in accordance with the relevant shipbuilding
contract, design and specifications;

 

(e) negotiating the purchase and sale agreement and related documentation;

 

(f) liaising with classification societies, suppliers and other service
providers;

 

(g) procuring, supervising and managing suitably qualified Crew to test the
Vessel in the water prior to delivery;

 

(h) attending to the purchasing and other activities related to the Pre-delivery
Purchases and Expenses; and

 

(i) arranging for registration of the Vessel under the relevant flag and in
accordance with Applicable Laws and registration of the Vessel with the relevant
classification society and other authorities as may be required for obtaining
trading, canal and other marine certificates for the Vessel.

 

5.3 Pre-delivery Purchases and Expenses.  Prior to the delivery to the relevant
Company Group Member of any Vessel, the Manager shall arrange for provision of
the necessary stores, spares, lubricating oil, supplies, equipment and services
related to the delivery of the Vessel (all of which will be set out by the
Manager in a pre-delivery budget for each Vessel, which shall be subject to the
acknowledgment and consent of the Company) to ensure the seaworthiness and
readiness for service of each such Vessel, and the Company shall pay for the
fees associated with the relevant classification society or the registration of
the Vessel in the name of the relevant Company Group Member under the relevant
flag, whether a newbuilding or an existing Vessel

 

5.4 Estimates and Consultation.  For each newbuilding Drybulk Carrier, if any,
the Manager shall consult with and obtain the approval of the Company with
respect to all material decisions to be made regarding the newbuilding. The
Manager shall also consult with the Company regarding, and provide to the
Company an estimate of the cost of, the Pre-delivery Services and the various
Pre-delivery Purchases and Expenses for any Vessel provided other than by the
Manager, for approval by the Company reasonably in advance of such services
being provided or such items being purchased.

 

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6. EMPLOYEES AND MANAGER’S PERSONNEL

 

6.1 Manager’s Personnel.  The Manager shall provide the Management Services
hereunder through the Manager’s Personnel and the Crew. The Manager shall be
responsible for all aspects of the employment or other relationship of the
Manager’s Personnel and Crew as required in order for the Manager to perform its
obligations hereunder, including recruitment, training, staffing levels,
compensation and benefits, supervision, discipline and discharge, and other
terms and conditions of employment or contract. However, the Manager shall
remain directly responsible and liable to the Company to carry out all of its
obligations under this Agreement, whether performed directly or subcontracted to
another Person, and the Manager (and not the Company) shall be responsible for
the compensation and reimbursement of all such other Persons.

 

6.2 Officers

 

(a) Executive Officers.  The Manager shall regularly consult with the President
and Chief Financial Officer as to the provision of Management Services and the
Company’s Business. The Manager shall make available to the Company such
executive officers to which the Company and the Manager or its Affiliates may
agree, who shall assist in managing the day-to-day operations and affairs of the
Company. Notwithstanding the foregoing, the Company may employ directly any
other officers or employees as it may deem necessary, and any such officers and
employees will not be subject to this Agreement.

 

(b) Termination and Replacement of Executive Officers.  The Board of Directors
may require any officer that is provided by the Manager of its Affiliates as an
executive officer (or otherwise to perform the duties of an executive officer)
of the Company to be relieved of his or her duties with respect to, and no
longer perform any of the Management Services for, the Company for any reason
not prohibited by Applicable Laws. Such officer may continue to be employed by
the Manager but shall no longer provide any Management Services hereunder,
unless otherwise agreed by the Parties.

 

If any officer who is made available to the Company by the Manager or any of its
Affiliates, as the case may be, resigns, is terminated or otherwise vacates his
or her office, the Manager shall, as soon as practicable after acceptance of any
resignation or after such termination and upon the Company’s request, use
commercially reasonable efforts to identify suitable candidates for replacement
of such officer for the approval by the Board of Directors.

 

(c) Other Duties of the Manager’s Personnel.  The Company acknowledges that any
officers provided by the Manager and the other Manager’s Personnel that provide
Management Services may engage in business activities of the Manager and its
Affiliates that are unrelated to the Company and that conflicts of interest may
exist.

 

(d) Reporting Structure.  The President and the Chief Financial Officer shall
report to and be under the direction of the Board of Directors. The Manager
shall report to the Company and the Board of Directors through the President or
the Chief Financial Officer.

 

7. COVENANTS OF THE MANAGER

 

The Manager hereby agrees and covenants with the Company that, during the Term,
the Manager shall:

 

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(a) obtain and maintain for its benefit professional indemnity insurance and
other insurance as is reasonable having regard to the nature and extent of the
Manager’s obligations under this Agreement;

 

(b) exercise all due care, skill and diligence in carrying out its duties under
this Agreement as required by Applicable Laws;

 

(c) provide the President, the Chief Financial Officer, and the Board of
Directors with all information in relation to the performance of the Manager’s
obligations under this Agreement as the President, the Chief Financial Officer,
or the Board of Directors may reasonably request;

 

(d) use its reasonable best efforts to have all material property of the Company
clearly identified as such, held separately from property of the Manager and,
where applicable, in safe custody;

 

(e) use its reasonable best efforts to have all property of the Company (other
than money to be deposited to any bank account of the Company) transferred to or
otherwise held in the name of the Company or any nominee or custodian appointed
by the Company;

 

(f) use its reasonable best efforts to cause (i) the Company to own or possess
all Licenses that are necessary and used in the operation of its business as of
the date hereof, (ii) all such Licenses to be in full force and effect at all
times, and (iii) all required filings with respect to such Licenses to be timely
made and all required applications for renewal thereof to be timely filed;

 

(g) use its reasonable best efforts to retain at all times a qualified staff so
as to maintain a level of expertise sufficient to provide the Management
Services; and

 

(h) use its reasonable best efforts to keep full and proper books, records and
accounts showing clearly all transactions relating to its provision of
Management Services in accordance with established general commercial practices
and in accordance with GAAP, and allow the Company and its representatives to
audit and examine such books, records and accounts at any time during customary
business hours.

 

8. MANAGER’S COMPENSATION AND REIMBURSEMENT

 

8.1 Fees for Management Services; Reimbursement.  In consideration for the
provision of Management Services by the Manager to the Company, the Company
shall pay the Manager the amounts set forth on Schedule B hereto in accordance
with Section 8.2 (“Management Fees”).  In addition, the Company shall reimburse
the Manager for (a) all of the reasonable direct and indirect costs and expenses
incurred by the Manager and its Affiliates in providing Management Services and
(b) the pro rata portion of the salary and other costs incurred by the Manager
in employing and compensating an internal auditor who will be made available to
the Company on a part time basis.

 

8.2 Invoicing.  The Manager shall, in good faith, determine the expenses related
to the Management Services that are allocable to the Company Group in any
reasonable manner determined by the Manager and shall provide to the Company on
a quarterly basis an invoice for the Costs and Expenses to be paid under
Section 8.1, which invoice shall contain a description in reasonable detail of
the Costs and Expenses that comprise the aggregate amount of the payment being
invoiced. The Manager shall maintain the records of all Costs and Expenses
incurred, including any invoices, receipts and supplementary materials as are
necessary or proper for the settlement of accounts between the Parties. The
Company shall pay such invoices within thirty (30) days of receipt, unless the
invoice is being disputed in accordance with this Agreement.

 

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8.3 Dispute of Invoice.  If the Company, in good faith, disputes the amount of
an invoice, the Company shall give written notice of such dispute (including the
particulars of such dispute) to the Manager on or before the due date with
respect to all or any portion of such invoice. Upon receipt of such notice, the
Manager shall furnish the Company with additional supporting documentation to
reasonably substantiate the amount of the invoice or the Performance Fee
calculation, as applicable. Upon delivery of such additional documentation, the
Company and the Manager shall cooperate in good faith and use commercially
reasonable efforts to resolve such dispute. If they are unable to resolve the
dispute within (i) ten (10) Business Days of the delivery of such additional
supporting information (in the case of an invoice) or (ii) five (5) days of such
delivery (in the case of the Performance Fee calculation), the dispute shall be
referred for resolution to a firm of independent accountants of nationally
recognized standing in the United States reasonably satisfactory to each of the
Manager and the Company (the “Accounting Referee”), which shall determine the
disputed amounts within thirty (30) days of the referral of such invoice dispute
to such Accounting Referee, or within ten (10) days of the referral of such
Performance Fee calculation dispute. The determination of the Accounting Referee
shall not require the Company to pay more than the amount in dispute nor require
the Manager to return any amount previously paid by the Company. The fees and
expenses of the Accounting Referee shall be borne equally by the Company and the
Manager. If any invoice dispute is resolved in favor of the Manager, the Company
shall make payment to the Manager within ten (10) days of resolution of the
dispute. Notwithstanding the foregoing, in no event shall the Company be
entitled to withhold any amounts other than those portions of the applicable
payment that are in dispute.

 

8.4 Direction to Pay.  By written notice to the Company, the Manager may direct
the Company to pay any amounts owing under this Agreement directly to an
Affiliate of the Manager pursuant to a subcontracting arrangement relating to
this Agreement.

 

9. LIABILITY OF THE MANAGER; INDEMNIFICATION

 

9.1 Liability of the Manager.  The Manager shall not be liable to the Company
for any Loss (including but not limited to loss of profit arising out of or in
connection with arrest, detention of or delay to any Vessel) arising from the
Management Services unless and to the extent that such Loss resulted from:

 

(a) the fraud, gross negligence, recklessness or willful misconduct of the
Manager or any of its Affiliates (other than the Company Group) or any of their
respective employees, agents or subcontractors (“Manager Misconduct”); or

 

(b) any breach of this Agreement by the Manager of any of its Affiliates (other
than the Company Group).

 

Notwithstanding anything that may appear to the contrary in this Agreement, the
Manager shall not be responsible for any of the actions of the crew of any
Vessel even if such actions are negligent, grossly negligent or willful.

 

9.2 Extraordinary Costs and Capital Expenditures.  Notwithstanding anything to
the contrary in this Agreement, the Manager shall not be responsible for paying
any costs, liabilities and expenses in respect of a Vessel to the extent that
such costs, liabilities and expenses are “extraordinary,” which consist of the
following:

 

(a) repairs, refurbishment or modifications resulting from maritime accidents,
collisions, other accidental damage or unforeseen events (except to the extent
that such accidents, collisions, damage or events are due to Manager’s
Misconduct, unless and to the extent otherwise covered by insurance);

 

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(b) drydocking of a Vessel;

 

(c) any improvement, upgrade or modification to, structural changes with respect
to or the installation of new equipment aboard any Vessel that results from a
change in, an introduction of new, or a change in the interpretation of,
Applicable Laws at the recommendation of the classification society for that
Vessel or otherwise;

 

(d) any increase in Crew Employment and Support Expenses resulting from a change
in, an introduction of new, or a change in the interpretation of, Applicable
Laws; or

 

(e) any other similar types of costs, liabilities and expenses that were not
reasonably contemplated by the Company and the Manager as being a component of
the Approved Budget for the applicable Fiscal Year.

 

9.3 Manager Indemnification.  The Company shall indemnify and save harmless the
Manager and its directors, officers, employees, subcontractors and Affiliates
(the “Manager Indemnified Persons”) from and against any and all Losses incurred
or suffered by the Manager Indemnified Persons by reason of or arising from or
in connection with their performance of this Agreement or any third-party Legal
Action brought or threatened against such Manager Indemnified Persons in
connection with their performance of this Agreement, other than for any Losses
to the extent related to or that resulted from:

 

(a) any liabilities or obligations that the Manager has agreed to pay or for
which the Manager is otherwise expressly responsible under this Agreement;

 

(b) Manager Misconduct; or

 

(c) any breach of this Agreement by the Manager or any of its Affiliates (other
than the Company Group).

 

9.4 Company Indemnification.  The Manager shall indemnify and save harmless each
Company Group Member and such Company Group Member’s directors, officers,
employees, subcontractors and Affiliates (the “Company Indemnified Persons”)
from and against any and all Losses incurred or suffered by the Company
Indemnified Persons, to the extent related to or that resulted from:

 

(a) any liabilities or obligations that the Manager has agreed to pay or for
which the Manager is otherwise expressly responsible under this Agreement;

 

(b) Manager Misconduct; or

 

(c) any breach of this Agreement by the Manager or any of its Affiliates (other
than the Company Group).

 

9.5 Limitation Regarding Crew

 

Notwithstanding anything to the contrary in this Agreement, the Manager shall
not be liable for any of the actions of the Crew, even if such actions are
negligent, grossly negligent or willful, except only to the extent that they are
shown to have resulted from a breach by the Manager of any of its obligations
under Section 3.3, in which case the Manager’s liability shall be determined in
accordance with the terms of this Section 9.

 

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10. TERM AND TERMINATION

 

10.1 Initial Term.  The initial term of this Agreement shall commence on March
15, 2010 and end on the Initial Expiration Date, unless terminated earlier
pursuant to this Agreement (the “Initial Term”).

 

10.2 Renewal Term.   This Agreement will, without any further act or formality
on the part of either Party, on the expiration of the Initial Term or any
Renewal Term, be automatically renewed for a further term of five (5) years
(each a “Renewal Term”) unless notice of termination is given by the Company to
the Manager in accordance with Section 10.3(f), in the case of the Initial Term,
or Section 10.3(g), in the case of any Renewal Term.

 

10.3 Termination by the Company.  This Agreement may be terminated by the
Company:

 

(a) if, at any time, the Manager materially breaches this Agreement and the
matter is unresolved after ninety (90) days pursuant to the dispute resolution
procedures set forth in Section 11 (“Manager Breach”);

 

(b) if, at any time,

 

(i) the Manager has been convicted of, has entered a plea of guilty or nolo
contendere with respect to, or has entered into a plea bargain or settlement
admitting guilt for, a crime, which conviction, plea bargain or settlement is
demonstrably and materially injurious to the Company; and

 

(ii) the holders of a majority of the outstanding Common Shares elect to
terminate this Agreement;

 

(c) if, at any time, the Manager becomes insolvent, admits in writing its
inability to pay its debts as they become due, is adjudged bankrupt or declares
bankruptcy or makes an assignment for the benefit of creditors, a proposal or
similar action under the bankruptcy, insolvency or other similar laws of any
applicable jurisdiction, or commences or consents to proceedings relating to it
under any reorganization, arrangement, readjustment of debt, dissolution or
liquidation law or statute of any jurisdiction;

 

(d) if any Person or group of Persons other than Peter C. Georgiopoulos acquires
Control or economic control of the Manager in contravention of Section 12.2;

 

(e) if, in the Fiscal Quarter that is four Fiscal Quarters before the Fiscal
Quarter that contains the tenth anniversary of the Initiation Date, two-thirds
of the Board of Directors elect to terminate the Agreement, which termination
shall be effective on the last day of the Fiscal Quarter that contains the tenth
anniversary of the Initiation Date;

 

(f) if, in the Fiscal Quarter  that is four Fiscal Quarters before the Fiscal
Quarter that contains the Initial Expiration Date, the Company elects to
terminate the Agreement by notice to the Manager, which termination shall be
effective on the Initial Expiration Date; or

 

(g) if, in the fourth calendar quarter of any twelve-month period immediately
preceding the twelve month period that includes the end of any Renewal Term, the
Company elects to terminate the Agreement by notice to the Manager, which
termination shall be effective at the end of such Renewal Term.

 

10.4 Termination by the Manager.  This Agreement may be terminated by the
Manager:

 

(a) after the fifth anniversary of the Public Offering, with twelve (12) months’
prior notice by the Manager to the Company;

 

(b) if, at any time, the Company materially breaches the Agreement and the
matter is unresolved after ninety (90) days pursuant to the dispute resolution
procedures set forth in Section 11 (“Company Breach”); or

 

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(c) at any time upon the earlier of (i) the occurrence of a Change of Control of
the Company or (ii) the Manager’s receipt of written notice from the Company
that such a Change of Control will occur until sixty (60) days after the later
of (x) the occurrence of such a Change of Control or (y) the Manager’s receipt
of the written notice in the preceding clause (ii).   If the Company has
knowledge that a Change of Control of the Company will occur, the Company shall
give prompt written notice thereof to the Manager.  A “Change of Control” means
the occurrence of any of the following:

 

(A) the sale, lease, transfer, conveyance or other disposition (other than by
way of merger or consolidation), in one or a series of related transactions, of
all or substantially all of the Company’s assets, except such a disposition to a
member of the Existing Ownership Group;

 

(B) an order made for, or the adoption by the Board of Directors of a plan of,
liquidation or dissolution of the Company;

 

(C) the consummation of any transaction (including any merger or consolidation)
the result of which is that any “person” (as such term is used in
Section 13(d)(3) of the Exchange Act) becomes the beneficial owner, directly or
indirectly, of a majority of the Company’s Voting Securities (unless such
“person” is a member of the Existing Ownership Group), measured by voting power
rather than number of shares;

 

(D) if, at any time, the Company becomes insolvent, admits in writing its
inability to pay its debts as they become due, is adjudged bankrupt or declares
bankruptcy or makes an assignment for the benefit of creditors, or makes a
proposal or similar action under the bankruptcy, insolvency or other similar
laws of any applicable jurisdiction or commences or consents to proceedings
relating to it under any reorganization, arrangement, readjustment of debt,
dissolution or liquidation law or statute of any jurisdiction;

 

(E) the consolidation of the Company with, or the merger of the Company with or
into, any “person” (other than a member of the Existing Ownership Group), or the
consolidation of any “person” (other than a member of the Existing Ownership
Group) with, or the merger of any “person” (other than a member of the Existing
Ownership Group) with or into, the Company, in any such event pursuant to a
transaction in which any of the Common Stock or Class B Stock outstanding
immediately prior to such transaction are converted into or exchanged for cash,
securities or other property or receive a payment of cash, securities or other
property, other than any such transaction where the Company’s Voting Securities
outstanding immediately prior to such transaction are converted into or
exchanged for Voting Securities of the surviving or transferee “person”
constituting a majority (measured by voting power rather than number of shares)
of the outstanding Voting Securities of such surviving or transferee “person”
immediately after giving effect to such issuance; or

 

(F) a change in directors after which a majority of the members of the Board of
Directors are not Continuing Directors.

 

10.5 Effects of Termination or Expiry of this Agreement.  (a) If the Manager
terminates this Agreement pursuant to Section 10.4(a), the Company shall have
the option to require the Manager to continue to provide Technical Services to
the Company, for the fee described in Section 8.1, for up to an additional
two-year period from the date of termination of this Agreement.

 

(b) If the Company terminates this Agreement pursuant to any of
Sections 10.3(e) through 10.3(g), or the Manager terminates this Agreement
pursuant to Section 10.4(b) or Section 10.4(c), the Company shall pay to the
Manager the Termination Payment in a lump sum amount, payable within 30 days
following the date this Agreement terminates.

 

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(d) Upon termination of this Agreement for any reason or expiry of this
Agreement or upon the Manager otherwise ceasing to manage a Vessel under this
Agreement, with respect to the Stores and Equipment provided by the relevant
Company Group Member or the Manager, as applicable, the following shall occur:

 

(i) in the case of any Vessel where the necessary Stores and Equipment were
provided by the Manager, at the time of delivery of such Vessel to the relevant
Company Group Member, the Company or such Company Group Member shall reimburse
the Manager for the fair market value (as of the time of such termination,
expiry or cessation) of the Stores and Equipment that had been placed on board
the Vessel by the Manager, taking into account reasonable wear and tear (such
value to be proposed by the Manager and subject to approval by the Company),
except that if such Vessel is to be scrapped immediately following such
termination, expiry or cessation, the Manager shall use commercially reasonable
efforts to sell, re-use or recycle the Stores and Equipment and any compensation
received by the Manager in doing so shall be deducted from the amounts to be
reimbursed by the Company or such Company Group Member to the Manager; and

 

(ii) in the case of any Vessel where the necessary Stores and Equipment were
provided by the relevant Company Group Member, at the time of delivery of such
Vessel to such Company Group Member, the Manager shall either, at the Company’s
option, (A) return the Vessel with materially the same level and complement of
Stores and Equipment as required to continue operating the Vessel in accordance
with customary ship operation and practice that a prudent owner of a Vessel such
as the Vessel would deem reasonably necessary, taking into account reasonable
wear and tear, or (B) pay to the Company or such Company Group Member an amount
representing the amount of Stores and Equipment needed to be added to existing
levels to satisfy the levels described in subclause (A) above (such amount to be
proposed by the Manager and subject to approval by the Company); provided,
however, that if such Vessel is to be scrapped immediately following such
termination, expiry or cessation, the Manager shall be required to make the
payment contemplated in subclause (B) above.

 

Until any of the foregoing events arise, neither any Company Group Member nor
the Manager shall have any obligation to each other to account for any
diminution in value of the Stores and Equipment.

 

(e) Upon termination or expiry of this Agreement, this Agreement will be void
and there shall be no liability on the part of any Party (or their respective
officers, directors, employees or Affiliates) except that the obligation of the
Company to pay to the Manager or its Affiliates the amounts accrued but
outstanding under Section 8 and the terms and conditions set forth in Sections
9, 10.6 and 12.4 shall survive such termination. After a written notice of
termination has been given under this Section 10 or upon expiry, the Company may
direct the Manager to, at the cost of the Company (subject to Section 10.5(d)),
undertake any actions reasonably necessary to transfer any aspect of the
ownership or control of the assets of the Company to the Company or to any
nominee of the Company and to do all other things reasonably necessary to bring
the appointment of the Manager to an end at the appropriate time, and the
Manager shall promptly comply with all such reasonable directions. Upon
termination or expiry of this Agreement, the Manager shall promptly deliver to
any new manager or the Company any Books and Records held by the Manager under
this Agreement and shall execute and deliver such instruments and do such things
as may reasonably be required to permit the new manager of the Company to assume
its responsibilities.

 

11. DISPUTE RESOLUTION

 

11.1 Notice of Dispute.  If (a) a dispute or disagreement arises between the
Parties with respect to any provision of this Agreement (other than
Section 8.3), including its interpretation or the performance of a Party under
this Agreement or (b) (i) the Company in good faith believes that a Manager
Breach has occurred or is reasonably likely to occur or (ii) the Manager in good
faith believes that a Company Breach

 

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has occurred or is reasonably likely to occur (each of the foregoing, as well as
any inability of the Parties to agree, pursuant to Section 8.1, upon the
adjusted Commercial Management Services Fee by the date sixty (60) days prior to
January 1 of the year in which such adjusted fee is scheduled to take effect,
being a “Dispute”), either Party may, or the Party alleging such breach or
potential breach shall, deliver written notice to the other Party. Such notice
shall contain in detail the specific facts and circumstances relating to the
Dispute. With respect to any Dispute described in clause (a) or (b) above, each
Party shall designate an individual to negotiate and resolve the Dispute (each a
“Designated Representative” and, together, the “Designated Representatives”).
The Designated Representatives shall in good faith attempt to resolve the matter
within a thirty (30) day period from the date of delivery of the notice referred
to above. If either Designated Representative intends to be accompanied by
counsel at any meeting, such Designated Representative shall give the other
Designated Representative at least three (3) Business Days’ notice. All
discussions and negotiations pursuant to this Section 11 shall be confidential
and without prejudice to settlement negotiations.

 

11.2 Mediation.  If a Dispute described in clause (a) or (b) of Section 11.1 is
not resolved by the Designated Representatives during after the thirty (30) days
provided in Section 11.1, either of the Parties may refer the matter to
mediation. Any Dispute relating to the determination of an adjusted Commercial
Management Services Fee (a “Commercial Management Services Fee Dispute”) shall
be referred to mediation. With respect to the mediation of any Dispute, the
mediator shall be mutually agreed upon by the Parties, and such mediator will be
instructed to:

 

(a) review the terms of the Dispute and the position of the Parties;

 

(b) consider the terms of and context of this Agreement; and

 

(c) render a non-binding report within sixty (60) days (20 days in the case of a
Commercial Management Services Fee Dispute) of the appointment of the mediator
(the “Mediator’s Report”) or such later date as to which the Parties may agree.

 

The Parties shall consider the Mediator’s Report and may mutually decide to make
it a binding report. If the mediator is not able to facilitate a binding
agreement between the Parties, the Dispute is not resolved to the satisfaction
of the Parties as a result of the Mediator’s Report or a mediator cannot be
chosen mutually by the Parties, the Dispute shall be submitted to binding
arbitration pursuant to Section 11.3.

 

11.3 Arbitration.  Any Dispute not resolved by the Parties pursuant to
Section 11.1 or 11.2 shall be fully and finally resolved by binding arbitration
pursuant to this Section 11.3. Either Party may refer the Dispute to
arbitration, which shall take place in New York, New York in accordance with the
Commercial Arbitration Rules of the American Arbitration Association before a
single arbitrator. The prevailing Party in any such arbitration shall be
entitled to costs, expenses and reasonable attorneys’ fees, and judgment upon
the award rendered by the arbitrators may be entered in any court having
jurisdiction thereof.

 

12. GENERAL

 

12.1 Assignment; Binding Effect.  The Parties may not assign any of their
respective rights under this Agreement in whole or in part without the prior
written consent of the other Party, which consent may be withheld in the sole
discretion of such other Party. This Agreement is binding upon and inures to the
benefit of the Parties and their successors and permitted assigns.

 

12.2 Change of Control of the Manager.  If any Person or group of Persons acting
in concert (other than Affiliates of Genco) proposes to acquire Control of the
Manager, directly or indirectly, the Manager shall provide at least thirty
(30) days’ written notice of the change of Control to the Company, which

 

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notice shall identify the Person that will acquire, directly or indirectly,
Control of the Manager. A change of Control of the Manager may occur only with
the consent of the Company, which consent shall not be unreasonably withheld or
delayed.

 

12.3 Force Majeure.  Neither of the Parties shall be under any liability for any
failure to perform any of their obligations hereunder if any of the following
occurs (each a “Force Majeure Event”):

 

(a) any event, cause or condition which is beyond the reasonable control of
either or both of the Parties and which prevents either or both of the Parties
from performing any of their respective obligations under this Agreement;

 

(b) acts of God, including fire, explosions, unusually or unforeseeably bad
weather conditions, epidemic, lightening, earthquake or tsunami;

 

(c) acts of public enemies, including war or civil disturbance, vandalism,
sabotage, terrorism, blockade or insurrection;

 

(d) acts of a Governmental Authority, including injunction or restraining orders
issued by any judicial, administrative or regulatory authority, expropriation or
requisition;

 

(e) government rule, regulation or legislation, embargo or national defense
requirement; or

 

(f) labor troubles or disputes, strikes or lockouts, including any failure to
settle or prevent such event which is in the control of any Party.

 

A Party shall give written notice to the other Party promptly upon the
occurrence of a Force Majeure Event.

 

12.4 Confidentiality.  (a)  Each Receiving Party agrees:

 

(i)            to use any Confidential Information solely to carry out its
obligations or exercise its rights under this Agreement  (the “Purpose”) and for
no other purpose;

 

(ii)           to copy and make other works based on Confidential Information
only as strictly necessary for the Purpose;

 

(iii)          to maintain the confidentiality of the Confidential Information
using at least the same degree of care that the Receiving Party uses for its own
confidential or proprietary information of a similar nature, but no less than
reasonable care;

 

(iv)          to reveal any Confidential Information to any third party without
the prior written consent of the Disclosing Party, except that if the Receiving
Party is required by law, court or administrative order or regulation to reveal
any Confidential Information, the Receiving Party is permitted to do so provided
that the Receiving Party gives the Disclosing Party reasonable prior written
notice (if permitted) of the required disclosure and cooperate with the
Disclosing Party at its expense in seeking a protective order or other relief;

 

(v)           to limit disclosure of the Confidential Information to such of
your officers and employees as is necessary for the Purpose;

 

(vi)          to inform each officer and employee who receives any Confidential
Information of the restrictions as to use and disclosure of Confidential
Information contained herein and to be responsible for any breach of such
restrictions by any such persons;

 

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(vii)         Forthwith upon the Disclosing Party’s request, to procure the
return of all Confidential Information together with any copies, abstracts, or
other works which contain or are based on any of the Confidential Information;
provided that, notwithstanding the foregoing, the Receiving Party shall be
permitted to retain Confidential Information to the extent it is required to
retain such Confidential Information pursuant to law, court or administrative
order or regulation;

 

(b) Each Receiving Party further acknowledges that any breach of the provisions
of this Agreement would result in serious damage being sustained by the
Disclosing Party, and as a result hereby unconditionally agrees:

 

(i)            To be responsible for losses, damages or expenses (including
without limitation attorneys’ fees and expenses) that have been determined to
have been caused by any such breach; and

 

(ii)           That the Disclosing Party shall be entitled to equitable relief
(including without limitation injunctive relief) in relation to any threatened
or actual breach of the provisions of this Agreement without any requirement of
posting a bond and without limiting any other remedy that may be available to
the Disclosing Party.

 

12.5 Notices.  Each notice, consent or request required to be given to a Party
pursuant to this Agreement must be given in writing. A notice may be given by
delivery to an individual or by fax, and shall be validly given if delivered on
a Business Day to an individual at the following address, or, if transmitted on
a Business Day, by fax or email addressed to the following Party:

 

 

 

 

 

(a)

if to the Company:

(b)

if to the Manager:

 

 

 

 

 

Address:   299 Park Avenue, 20th Floor

 

Address:  299 Park Avenue, 20th Floor

 

   New York, NY 10171

 

  New York, NY 10171

 

 

 

 

 

Attention:  John C. Wobensmith

 

Attention:  Robert Gerald Buchanan

 

    President and Chief Financial Officer

 

    President

 

 

 

 

 

Fax No.:    (646) 443-8551

 

Fax No.:    (646) 443-8551

 

or to any other address or fax number that the Party so designates by notice
given in accordance with this Section. Any notice

 

(a) if validly delivered on a Business Day, shall be deemed to have been given
when delivered; and

 

(b) if validly transmitted by fax on a Business Day, shall be deemed to have
been given on that Business Day.

 

12.6 Third Party Rights.  The provisions of this Agreement are enforceable
solely by the Parties to this Agreement, and no shareholder, employee, agent of
any Party or any other Person shall have the right to enforce any provision of
this Agreement or to compel any Party to this Agreement to comply with the terms
of this Agreement.

 

12.7 No Partnership.  Nothing in this Agreement is intended to create or shall
be construed as creating a partnership or joint venture between the Parties, and
this Agreement shall not be deemed for any purpose to constitute any Party a
partner of any other Party to this Agreement in the conduct of any business or
otherwise or as a member of a joint venture or joint enterprise with any other
Party to this Agreement.

 

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12.8 Severability.  Each provision of this Agreement is several. If any
provision of this Agreement is or becomes illegal, invalid or unenforceable in
any jurisdiction, the illegality, invalidity or unenforceability of that
provision will not affect:

 

(a) the legality, validity or enforceability of the remaining provisions of this
Agreement; or

 

(b) the legality, validity or enforceability of that provision in any other
jurisdiction;

 

except that if:

 

(x) on the reasonable construction of this Agreement as a whole, the
applicability of the other provision presumes the validity and enforceability of
the particular provision, the other provision will be deemed also to be invalid
or unenforceable; and

 

(y) as a result of the determination by a court of competent jurisdiction that
any part of this Agreement is unenforceable or invalid and, as a result of this
Section 12.8, the basic intentions of the Parties in this Agreement are entirely
frustrated, the Parties shall use commercially reasonable efforts to amend,
supplement or otherwise vary this Agreement to confirm their mutual intention in
entering into this Agreement.

 

12.9 Governing Law; Jurisdiction; Venue.  This Agreement shall be governed by
and construed in accordance with the laws of the State of New York applicable to
contracts executed in and to be performed in that state, and each party hereto
agrees to submit to the non-exclusive jurisdiction of the federal or state
courts located in the City, County and State of New York as regards any claim or
matter arising under or in connection with this Agreement.  Each of the Parties
hereby irrevocably and unconditionally waives any objection to the laying of
venue of any action, suit or proceeding arising out of this agreement or the
transactions contemplated hereby, in the federal or state courts located in the
City, County and State of New York, and hereby further irrevocably and
unconditionally waives and agrees not to plead or claim in any such court that
any such action, suit or proceeding brought in any such court has been brought
in an inconvenient forum or seek to change the venue from any such court.

 

12.10 Amendments.   No amendment, supplement, modification or restatement of any
provision of this Agreement shall be binding unless it is in writing and signed
by each Person that is a Party to this Agreement at the time of the amendment,
supplement, modification or restatement.

 

12.11 Entire Agreement.  This Agreement constitutes the entire agreement among
the Parties pertaining to the subject matter hereof and supersedes all prior
agreements and understandings pertaining thereto.

 

12.12 Waiver.  No failure by any Party to insist upon the strict performance of
any covenant, duty, agreement or condition of this Agreement or to exercise any
right or remedy consequent upon a breach thereof shall constitute a waiver of
any such breach or of any other covenant, duty, agreement or condition. Any
waiver must be specifically stated as such in writing.

 

12.13 Counterparts.  This Agreement may be executed in any number of
counterparts, all of which together shall constitute one agreement binding on
the Parties.

 

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IN WITNESS WHEREOF, this Management Agreement has been duly executed by the
Parties as of the date first written above.

 

BALTIC TRADING LIMITED

 

GENCO SHIPPING & TRADING LIMITED

 

 

 

By:

/s/ John C. Wobensmith

 

By:

/s/ John C. Wobensmith

Name:

John C. Wobensmith

 

Name:

John C. Wobensmith

Title:

President and Chief Financial Officer

 

Title:

Chief Financial Officer

 

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SCHEDULE A
VESSELS

 

(As of March 15, 2010)

 

This Schedule may be updated from time to time as the Parties in accordance with
Section 2.8.

 

 

 

Capacity

 

 

 

Current

 

Current

 

Expiration

 

 

Vessel

 

(dwt)

 

Built

 

Employment

 

Charterer

 

of Charter

 

Flag

None

 

 

 

 

 

 

 

 

 

 

 

 

 

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SCHEDULE B

 

MANAGEMENT FEES

 

Commercial services fee:  For the provision of Commercial Management Services,
the Company shall pay the Manager a fee of 1.25% of all gross charter revenues
generated by each Vessel.

 

Technical services fee:  For the provision of Technical Services (excluding
Commercial Management Services), the Company shall pay the Manager a fee for
technical services provided to the Company equal to $750 per Vessel per day.
  Such $750 amount shall be subject to increase on each anniversary of the date
hereof based on the total percentage increase, if any, in the Consumer Price
Index over the immediately preceding twelve months of the Term.

 

Sale & purchase fee:  Upon consummation of the sale or purchase of a Vessel, the
Company shall pay the Manager a fee equal to 1% of the gross purchase or sale
price.

 

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