ex4_2.htm


    


      DATED 7
APRIL 2008

       

       

       

       

       

       

       

       

       

       

      
        	
                TEEKAY CORPORATION

                as
      Vendor

                 

                and

                 

                TEEKAY
      TANKERS LTD.

                as
      Purchaser

                 

              
	
                 

                 

                 

                 

                 

                 

                 

                PURCHASE AGREEMENT

                 

                relating
      to

                the
      sale and purchase of the entire ownership interests in

                NARMADA
      SPIRIT L.L.C.

                (formerly
      ADAIR SHIPPING L.L.C)

                 

              


      

      


       

      



      
        
           


        

        
           


          
            

          

        

        
           


        

      


      


       

      Contents

       

      
      

       

      
        	 Clause 	 Name 	 Page
	 1	
                 Definitions
      and Interpretation 

              	    
      1
	 2	
                 Agreement
      For Sale 

              	    
      5
	 3	
                 Consideration 

              	    
      6
	 4	
                 Completion 

              	    
      6
	 5	
                 Warranties 

              	    
      8
	 6	
                 Remedies
      of the Purchaser 

              	    
      10
	 7	
                 Implementation 

              	    
      12
	 8	
                 Costs 

              	    
      13
	 9	
                 Other
      Provisions 

              	    
      13
	 10	
                 Notices 

              	    
      15
	 11	 Governing
      Law and Jurisdiction	    
      16
	 12	 Termination 	    
      17
	 	 	 
	 Schedule	 Name  	  Page
	 1	 Disclosure
      Schedule 	    
      18
	 2	 The
      Interests Transfer Documents 	    
      26
	 3	 Warranties and
      Representations 	    
      27
	 4	 The
      Vessel 	    
      40
	 5	 The
      Consideration Formula 	    
      41
	 Execution
      Page 	    
      42


      

       

       

      
      

      
      

      
      

      
      

      
      

      
      

      
      

      
      

      
      

      
      

                                                                                                                  

       

      
      

       

      
      

       

      
      

       

      
      

       

      



      
        
           


        

        
           


          
            

          

        

        
           


        

      


      


       

      DATED 7 April
2008

       

      BETWEEN:

       

      
        	
                (1)  

              	
                Teekay Corporation, a
      Marshall Islands company having a principal office at Bayside House,
      Bayside Executive Park, West Bay Street & Blake Road, P.O. Box
      AP-59212, Nassau, Bahamas (the “Vendor”)

              


      

       

      
        	
                (2)  

              	
                Teekay Tankers Ltd., a
      Marshall Islands limited partnership having a principal office at Bayside
      House, Bayside Executive Park, West Bay Street & Blake Road, P.O. Box
      AP-59212, Nassau, Bahamas (the “Purchaser”)

              


      

       

      BACKGROUND

       

      
        	
                (A)  

              	
                The
      Vendor is the legal and beneficial owner of the
  Interests.

              


      

       

      
        	
                (B)  

              	
                Pursuant
      to the Contribution Agreement, the Vendor is obliged to offer for sale to
      the Purchaser the Vessel together with m.v. “GANGES SPIRIT”, m.v. “YAMUNA
      SPIRIT” and m.v. “ASHKINI SPIRIT” within 18 months of the initial public
      offering of the Purchaser on 18 December
2007.

              


      

       

      
        	
                (C)  

              	
                The
      Contribution Agreement provides that the vessels referred to in Recital
      (B) above may be offered for sale either individually, in groups or
      collectively.

              


      

       

      
        	
                (D)  

              	
                Pursuant
      to the Memorandum, the Vendor has elected to first offer the Vessel
      together with m.v. “GANGES SPIRIT” for sale to the Purchaser, which will
      involve inter
      alia the sale of the Interests by the Vendor to the
      Purchaser.

              


      

       

      
        	
                (E)  

              	
                The
      Purchaser has agreed to purchase the Interests from the Vendor subject to
      the terms and conditions of this
Agreement.

              


      

       

      OPERATIVE
PROVISIONS

       

      
        	
                1  

              	
                DEFINITIONS
      AND INTERPRETATION

              


      

       

      
        	
                1.1  

              	
                Definitions

              


      

       

      In this
Agreement, including the Schedules and the recitals, unless the context requires
otherwise:

       

      “Borrowers”, “Bookrunners”, “Collateral Transfer”, “Finance
Documents”,  “Lenders”, “Mandated Lead Arrangers”,
“Security Trustee” and
“Swap Providers” each
has the meaning given to that term in the Facility Agreement.

       

      “Business Day” means a day
(other than a Saturday or Sunday) on which banks in New York are open for the
transaction of normal banking business (other than solely for trading and
settlement in Dollars) or, for the purposes of Clause 10 (Notices ),
a day on which banks are open for the transaction of normal banking business in
the country of receipt of a notice.

       

      “Business Information” means
all information and records (in whatever form held and whether commercial,
financial, technical or otherwise) relating to the Company or the business or
activities or affairs of the Company, which can be reasonably considered to be
confidential to the Company.

       

      
        
          
          

        

        
          1

          
            

          

        

        
          
          

        

      

      “Charter” means the time
charter in respect of the Vessel dated 30 June 2006 between (i) the Company and
(ii) the Charterer.

       

      “Charterer” means BP Shipping
Ltd.

       

      “Claim” means a claim for
breach of Warranty by the Purchaser against the Vendor.

       

      “Closing” means completion of
the sale and purchase of the Interests in accordance with Clause 4.1 (Timing and
place of Closing ).

       

      “Closing Date” means the day on
which Closing takes place which shall be 7 April 2008 unless otherwise agreed in
writing by the Purchaser and the Vendor.

       

      “Collateral Transfer
Arrangements” means the arrangements to be completed in order to give
effect to a Collateral Transfer in accordance with the terms of the Facility
Agreement.

       

      “Company” means Narmada Spirit
L.L.C., a limited liability company formed under the laws of the Republic of the
Marshall Islands with a registered office at Trust Company Complex, Ajeltake
Road, Ajeltake Island, Majuro, Marshall Islands MH96960.

       

      “Consideration” means the consideration payable by
the Purchaser for the Interests as stated in Clause 3 (Consideration ).

       

      “Consideration Formula”
means the formula for the calculation of the Consideration as set out in
Schedule 5 (The Consideration
Formula ).

       

      “Contribution Agreement” means
the contribution, conveyance and assumption agreement dated 18 December
2007 and made between (i) the Vendor, (ii) the Purchaser and (iii) Teekay
Holdings Limited.

       

      “Covered Environmental Losses”
means all environmental and toxic tort Losses and Expenses suffered or incurred
by the Purchaser, the Purchaser Group Companies or the Company by reason of or
arising out of:

       

      
        	
                      
      (a)  

              	
                any
      violation or correction of violation of Environmental Laws by the Vendor
      or the Vendor Group Companies; or

              


      

       

      
        	
                      
      (b)  

              	
                any
      event or condition associated with ownership or operation by the Vendor or
      the Vendor Group Companies of the Interests (including, without
      limitation, the presence of Hazardous Substances on, under, about or
      migrating to or from the Vessel or the disposal or release of Hazardous
      Substances generated by operation of the Vessel), including, without
      limitation:

              


      

       

      
        	
                                              
      (i)  

              	
                the
      cost and expense of any investigation, assessment, evaluation, monitoring,
      containment, cleanup, repair, restoration, remediation or other corrective
      action required or necessary under Environmental
  Laws;

              


      

       

      
        	
                                               
      (ii)  

              	
                the
      cost or expense of the preparation and implementation of any closure,
      remedial, corrective action or other plans required or necessary under
      Environmental Laws; and

              


      

       

      
        
          
          

        

        
          2

          
            

          

        

        
          
          

        

      

      
        	
                                                
      (iii)  

              	
                the
      cost and expense for any environmental or toxic tort pre-trial, trial or
      appellate legal or litigation support
work,

              


      

       

      but only
to the extent that such violation complained of under (a), or such events or
conditions included in (b), occurred before the Closing Date and, provided that,
in no event shall Losses or Expenses to the extent arising from a change in any
Environmental Law after the Closing Date be deemed “Covered Environmental
Losses”.

       

      “Disclosed”  means
fully, fairly and expressly disclosed by the Transaction Documents or the
Disclosure Schedule and, for this purpose “fairly disclosed” means any
information disclosed in such manner and in such detail or with sufficient
explanation as to enable a reasonable purchaser to make an informed assessment
or estimation of the matter concerned and its financial, operational or other
consequences to the Company.

       

      “Disclosure Schedule” means the
Disclosure Schedule provided to the Purchaser by the Vendor concurrently with
the execution and delivery of this Agreement.

       

      “Dollars” means United States
Dollars.

       

      “Environmental Laws” means all
federal, state, foreign and local laws, statutes, rules, regulations, orders,
judgments and ordinances relating to protection of health and safety and the
environment, each as amended up to and including the Closing Date.

       

      “Facility” means the
US$854,000,000 credit facility made available by the Lenders to the Borrowers
pursuant to the Facility Agreement.

       

      “Facility Agreement” means the
credit facility dated 28 November 2007 and made between (i) the Borrowers,
(ii) the Lenders, (iii) the Security Trustee, (iv) the Mandated Lead Arrangers,
(v) the Bookrunners and (vi) the Swap Providers pursuant to which the Lenders
have agreed to make a loan facility available to the Borrowers for the purposes
stated in the Facility Agreement.

       

      “Financing Arrangements” means
the financing arrangements in relation to the Vendor, the Purchaser, the Company
and the Vessel as contemplated by and created pursuant to the Facility
Agreement.

       

      “Hazardous Substances”
means:

       

      
        	
                      
      (a)  

              	
                substances
      which contain substances defined in or regulated under applicable
      Environmental Laws;

              


      

       

      
        	
                      
      (b)  

              	
                petroleum
      and petroleum products, including crude oil and any fractions
      thereof;

              


      

       

      
        	
                      
      (c)  

              	
                natural
      gas, synthetic gas and any mixtures
thereof;

              


      

       

      
        	
                      
      (d)  

              	
                any
      substances with respect to which a federal, state, foreign or local agency
      requires environmental investigation, monitoring, reporting or
      remediation;

              


      

       

      
        	
                      
      (e)  

              	
                any
      hazardous waste or solid waste, within the meaning of any Environmental
      Law;

              


      

       

      
        	
                      
      (f)  

              	
                any
      solid, hazardous, dangerous or toxic chemical, material, waste or
      substance, within the meaning of and regulated by any Environmental
      Law;

              


      

       

      
        
          
          

        

        
          3

          
            

          

        

        
          
          

        

      

      
        	
                      
      (g)  

              	
                any
      radioactive material; and

              


      

       

      
        	
                      
      (h)  

              	
                any
      asbestos-containing materials that represent a health
    hazard.

              


      

       

      “Indebtedness” means any
borrowings or other indebtedness whatsoever owed by the Company.

       

      
        “Insolvency Event” means in
relation to any of the Purchaser, the Vendor or the Company (as the context may
require) that any of the following actions has occurred in relation to
it:

      

       

      
        	
                      
      (a)  

              	
                an
      order has been made or an effective resolution passed or other proceedings
      or actions taken (including, without limitation, the presentation of a
      petition) with a view to its administration, bankruptcy, winding-up,
      liquidation or dissolution; or

              


      

       

      
        	
                      
      (b)  

              	
                it
      has had a receiver, administrative receiver, manager or administrator
      appointed over all or any substantial part of its undertaking or assets;
      or

              


      

       

      
        	
                      
      (c)  

              	
                any
      event has occurred or situation arisen in any jurisdiction that has a
      substantially similar effect to any of the
  foregoing.

              


      

       

      
        “Interests” means 100% of the
entire equity interests or share capital in the Company.

         

        “Losses and Expenses” means
liabilities, losses, damages, claims, demands, awards and expenses (including,
without limitation, legal costs) and includes, for the avoidance of doubt, any
value added tax (VAT) (or similar tax) payable in relation to any such matter,
circumstance or item (except to the extent that the party claiming Losses and
Expenses obtains credit for such VAT as input tax).

         

        “Memorandum” means the
memorandum dated 29 February 2008 by the Vendor addressed to the Conflicts
Committee of the Board of Directors of the Purchaser.

         

        “Purchaser Group Companies”
means the Purchaser and any subsidiaries thereof.

         

        “Relevant Documents” means
those agreements, contracts, understandings and arrangements to which the
Company is a party or to which any of the Interests, the Vessel or any other
assets of the Company are subject or by which they are bound which are material
to the Company or its trading activities, set out in the Disclosure
Schedule.

         

        “Security Interest” means any
mortgage, charge (whether fixed or floating), pledge, lien, hypothecation,
encumbrance, assignment, right of set-off, trust arrangement, title retention or
other security interest or other agreement or arrangement of any kind having the
effect of conferring security.

         

        “Specified Rate”  is
the rate of interest equal to yearly LIBOR from time to time plus 100 basis
points.

         

        “Tax” or “Taxation” means any tax, duty,
contribution, impost, levy or charge in the nature of tax, whether domestic or
foreign, and any fine, penalty, surcharge or interest in relation thereto,
including without limitation (and without prejudice to the foregoing)
corporation tax, income tax (including tax failing to be deducted or withheld
from or accounted for in respect of any payment), capital gains tax, value added
tax, customs excise and import duties, stamp duty, stamp duty reserve tax, and
any other payment whatsoever that the Company is or may be or become bound to
make to any person and that is or purports to be in the nature of taxation or
otherwise by reason of any taxation statutes.

         

        
          
            
            

          

          
            4

            
              

            

          

          
            
            

          

        

        “Taxation Authority” means any
national, local municipal, governmental, state, federal or fiscal, revenue,
customs or excise authority, body, agency or official anywhere in the world
having, or purporting to have power or authority in relation to
Tax.

         

        “Transaction Documents” means
this Agreement and the other documents delivered at Closing pursuant to
Clause 4 (Completion ).

         

        “Vendor’s
Account”  means such account of the Vendor as the Vendor may
specify to the Purchaser from time to time.

         

        “Vendor Group
Companies”  means the Vendor and any subsidiary of the Vendor,
from time to time (except, with effect from Closing, the Company and any
Purchaser Group Companies).

         

        “Vessel”  means the
vessel m.v. “NARMADA SPIRIT” owned by the Company, details of which are set out
in Schedule 4 (The
Vessel ).

         

        “Warranties” means the
representations and warranties set out in Clause 5 (Warranties ) and Schedule
3 (Warranties and
Representations ).

      

       

      
        	
                1.2  

              	
                Interpretation

              


      

       

      
        	
                1.2.1  

              	
                Reference
      to:

              


      

       

      
        	
                      
      (a)  

              	
                a
      person includes a legal or natural person, partnership, trust, company,
      government or local authority department or other body (whether corporate
      or unincorporated);

              


      

       

      
        	
                      
      (b)  

              	
                a
      statutory or regulatory body shall include its successors and any
      substituted body;

              


      

       

      
        	
                      
      (c)  

              	
                the
      singular includes the plural and vice versa;
and

              


      

       

      
        	
                      
      (d)  

              	
                one
      gender includes all genders.

              


      

       

      
        	
                1.2.2  

              	
                Unless
      otherwise stated, a reference to a Clause, sub-clause or Schedule is a
      reference to a Clause or sub-clause of, or Schedule to, this Agreement and
      a reference to this Agreement includes its
  Schedules.

              


      

       

      
        	
                1.2.3  

              	
                Clause
      headings in this Agreement and in the Schedules are for ease of reference
      only and do not affect its
construction.

              


      

       

      
        	
                1.2.4  

              	
                In
      construing this Agreement the so-called eusdem generis rule does not
      apply and accordingly the interpretation of general words shall not be
      restricted by words indicating a particular class or particular
      examples.

              


      

       

      
        	
                2  

              	
                AGREEMENT
      FOR SALE

              


      

       

      
        	
                2.1  

              	
                Sale
      and purchase of Interests

              


      

       

      Subject
to the other provisions of this Agreement, the Vendor shall sell and transfer
the Interests to the Purchaser and the Purchaser shall purchase and take
transfer of the Interests on the Closing Date.

       

      
        
          
          

        

        
          5

          
            

          

        

        
          
          

        

      

      
        	
                2.2  

              	
                Absolute
      title to Interests; no Security Interest in
  Interests

              


      

       

      The
Vendor shall take all steps within its power and control (but without any
obligation to expend any material amount) to procure the Purchaser and will duly
obtain absolute title to the entire legal and beneficial interest in the
Interests, and all rights (whether in respect of distributions, voting or
otherwise) that at the date of this Agreement or any later time are conferred on
or by any of the Interests, free from any Security Interest.

       

      
        	
                3  

              	
                CONSIDERATION

              


      

       

      
        	
                3.1  

              	
                Determination
      of the Consideration

              


      

       

      The
Consideration shall be determined in accordance with the Consideration
Formula.

       

      
        	
                3.2  

              	
                Payment
      of Consideration

              


      

       

      The
Consideration shall be paid by the Purchaser on the Closing Date by way of
electronic transfer to the account of the Vendor as specified by the Vendor in
writing at least five (5) Business days before the Closing Date.

       

      
        	
                3.3  

              	
                Vendor’s
      Undertakings

              


      

       

      In
addition to the transfer of the Interests to the Purchaser, the Vendor further
undertakes as follows:

       

      
        	
                      
      (a)  

              	
                that
      on Closing, it shall procure that the Company shall have no net
      liabilities other than the liabilities Disclosed in the Disclosure
      Schedule;

              


      

       

      
        	
                      
      (b)  

              	
                following
      the Closing Date and upon receiving any notices, correspondence,
      information or enquiries in relation to the Company, the Interests, the
      Vessel or the Transaction Documents, it shall forthwith pass copies
      thereof to the Purchaser and shall hold in trust for the Company and
      account forthwith for any monies received after the Closing Date on
      account of the Company.

              


      

       

      
        	
                4  

              	
                COMPLETION

              


      

       

      
        	
                4.1  

              	
                Timing
      and place of Closing

              


      

       

      Subject
to the provisions of this Agreement, Closing shall be effected by the Vendor
satisfying its obligations under Clause 4.2 (Vendor’s Closing
obligations )
and by the Purchaser satisfying its obligations under
Clause 4.3 (Purchaser’s Closing
obligations )
and shall take place on the Closing Date.

       

      
        	
                4.2  

              	
                Vendor’s
      Closing obligations

              


      

       

      
        	
                4.2.1  

              	
                The
      Vendor shall deliver or procure that there are delivered to the Purchaser
      on or before the Closing Date (as the context may
  permit):

              


      

       

      
        	
                      
      (a)  

              	
                duly
      executed transfers in respect of the Interests in favour of the Purchaser,
      or as it may direct;

              


      

       

      
        	
                      
      (b)  

              	
                the
      certificates, if any, for the Interests (or an indemnity in the approved
      form for any lost certificates);

              


      

       

      
        
          
          

        

        
          6

          
            

          

        

        
          
          

        

      

      
        	
                      
      (c)  

              	
                certified
      copies of the minutes of a meeting of the directors of the Vendor
      (certified as at the date of Closing to be a certified copy of such
      resolutions in full force and effect and certifying that such resolutions
      have not been revoked), confirming that it has authorised the transfer of
      the Interests to the Purchaser;

              


      

       

      
        	
                      
      (d)  

              	
                all
      statutory and minute books (in every case written up to, but not
      including, the Closing Date), common seals, certificates of formation and
      certificates of amendment (or equivalent), cheque books, bank mandates and
      other books and records (whether statutory, financial or otherwise) of the
      Company as applicable and all certificates and documents of title relating
      to any investments of the Company;

              


      

       

      
        	
                      
      (e)  

              	
                the
      original or certified true copies of the Transaction
      Documents;

              


      

       

      
        	
                      
      (f)  

              	
                the
      original or certified true copies of the Relevant
    Documents;

              


      

       

      
        	
                      
      (g)  

              	
                evidence
      satisfactory to the Purchaser that all amounts payable by the Company
      under any loan facilities made available by the Vendor (other than with
      respect to amounts Disclosed as liabilities in the Disclosure Schedule),
      any bank, financial institution, or any other person whether on the basis
      of any Security Interest provided by the Company, and whether in relation
      to the Vessel or otherwise, have been paid in full and all associated
      Security Interests (other than those identified in the Disclosure
      Schedule) and any other agreements or obligations entered into by the
      Company for the benefit of itself or any other person have been terminated
      or released and, in relation to Security Interests, reassigned to the
      Company or to the person giving the same;
and

              


      

       

      
        	
                      
      (h)  

              	
                the
      duly executed certificate of an officer of the Vendor dated on the Closing
      Date, in form reasonably acceptable to the Purchaser, certifying on behalf
      of the Vendor to the accuracy of representations and Warranties of the
      Vendor contained in this Agreement.

              


      

       

      
        	
                4.3  

              	
                Purchaser’s
      Closing obligations

              


      

       

         
The Purchaser shall on Closing and subject to the transfer of the
Interests:

       

      
        	
                      
      (a)  

              	
                deliver
      or procure that there is delivered to the Vendor a certified copy of the
      minutes of a meeting of the directors of its general partner, authorising
      the execution of this Agreement and any other Transaction Document that it
      is to execute pursuant to this
Agreement;

              


      

       

      
        	
                      
      (b)  

              	
                pay
      to the Vendor the Consideration in accordance with Clause 3.2 (Payment of
      Consideration).

              


      

       

      
        	
                4.4  

              	
                Closing
      obligations not fulfilled

              


      

       

      
        	
                4.4.1  

              	
                If
      either party fails, for any reason, to comply with any of its obligations
      under the foregoing provisions of this Clause 4 (Completion ), the other party
      may, at its option:

              


      

       

      
        	
                      
      (a)  

              	
                by
      written notice to the first party defer the date for Closing by one or
      more periods that shall not exceed 20 (twenty) Business Days in aggregate
      in respect of either all of the parties’ obligations under the foregoing
      provisions of this Clause 4 (Completion ) or such of those
      obligations that have not been complied with;
or

              


      

       

      
        
          
          

        

        
          7

          
            

          

        

        
          
          

        

      

      
        	
                      
      (b)  

              	
                proceed
      to Closing so far as practicable but without prejudice to the second
      party’s rights (whether under this Agreement or the general law) as
      regards the obligations with which the first party has not complied;
      or

              


      

       

      
        	
                      
      (c)  

              	
                waive
      all or any of the obligations in question of the first
    party.

              


      

       

      
        	
                4.4.2  

              	
                If
      Closing is deferred to another date in accordance with Clause 4.4.1(a),
      and Closing is effected, the provisions of this Agreement shall apply as
      if that other date were the Closing
Date.

              


      

       

      
        	
                5  

              	
                WARRANTIES

              


      

       

      
        	
                5.1  

              	
                General

              


      

       

      The
Vendor represents, warrants and undertakes, subject to
Clause 5.8 (Disclosure in Disclosure
Schedule ),
that each statement in Schedule 3 (Warranties and
Representations ) is at the date of this
Agreement, and will (save as Disclosed in the Disclosure Schedule or in writing
not later than the time of Closing) at the Closing Date remain, true, accurate
and not misleading in any respect on the basis that a reference to the Closing
Date were substituted for any express or implied reference to the date of this
Agreement in that Schedule.

       

      
        	
                5.2  

              	
                Claims

              


      

       

      The
Vendor hereby unconditionally and irrevocably covenants with the Purchaser that,
subject always to the limitations set out in Clause 6 (Remedies of the
Purchaser ),
it will indemnify the Purchaser and the Company against all Losses and Expenses
that any of the Purchaser Group Company or the Company may suffer or incur or
pay in enforcing its rights in connection with any matter referred to in this
Agreement or any of the Transaction Documents including, without
limitation:

       

      
        	
                      
      (a)  

              	
                the
      disputing and/or settlement of any Claims and any steps taken to avoid and
      advice sought in connection with any actual, threatened or anticipated
      Claims;

              


      

       

      
        	
                      
      (b)  

              	
                any
      legal proceedings in which any of the Purchaser Group Companies or the
      Company makes a Claim; and

              


      

       

      
        	
                      
      (c)  

              	
                the
      enforcement of any such settlement or
judgement.

              


      

       

      
        	
                5.3  

              	
                Reliance
      on Warranties

              


      

       

      The
Vendor acknowledges that:

       

      
        	
                      
      (a)  

              	
                the
      Purchaser has been induced to enter and is entering into this Agreement
      and the other Transaction Documents on the basis of and in reliance upon
      the Warranties;

              


      

       

      
        	
                      
      (b)  

              	
                the
      Purchaser may rely on the Warranties to the exclusion of any other
      information, and that, with the exception of matters set forth in the
      Disclosure Schedule, the Purchaser’s rights in respect thereof will not be
      in any way impaired as a result of any other information being possessed
      by or available to any Purchaser Group Companies or any officer, employee,
      professional or financial adviser of, or person acting on behalf of, the
      Purchaser or any Purchaser Group
Companies.

              


      

       

      
        
          
          

        

        
          8

          
            

          

        

        
          
          

        

      

      
        	
                5.4  

              	
                Warranties
      are separate and independent

              


      

       

      Each
Warranty shall be construed as a separate and independent warranty and, save as
expressly provided otherwise, shall not be limited or restricted by reference to
or inference from any other terms of this Agreement or any other
Warranty.

       

      
        	
                5.5  

              	
                Reduction
      in Consideration

              


      

       

      Any
payments made by the Vendor to the Purchaser in respect of Claims shall, to the
extent lawfully possible, be treated by the parties as a reduction in the
Consideration; provided, however, that this Clause 5.5 (Reduction in
Consideration ) shall not in any way
limit or restrict the amount recoverable by the Purchaser or any other person
under this agreement to the amount of the Consideration or any other amount (but
this is without prejudice to the limitations set out in
Clause 6 (Remedies
of the Purchaser ).

       

      
        	
                5.6  

              	
                Awareness
      of Vendor and Ordinary Course of
Business

              


      

       

      Where any
Warranty is qualified by reference to the awareness, knowledge, information or
belief of the Vendor (or any similar expression), the Vendor shall be
deemed to have such awareness, knowledge, information or belief as it would have
after having made reasonable enquiry of the senior executive managers and
officers of the Vendor.  In relation to each of the Warranties
concerning the assets, liabilities, Transaction Documents, Relevant Documents,
Vessel or results of the Company, such Warranties shall be deemed to be
qualified by reference to exclude any matters (whether or not Disclosed) arising
in the ordinary and normal course of trading since 7 April 2008.

       

      
        	
                5.7  

              	
                Provision
      of information

              


      

       

      The
Vendor undertakes promptly to provide the Purchaser with any information that
the Purchaser may by written notice request in relation to:

       

      
        	
                      
      (a)  

              	
                any
      of the Warranties or any statement of fact contained elsewhere in this
      Agreement, any Relevant Document or any Transaction Document;
      or

              


      

       

      
        	
                      
      (b)  

              	
                the
      Disclosure Schedule or any other disclosure made or information provided
      (or purportedly made or provided) under this Clause 5.7 (Provision of
      information );
  or

              


      

       

      
        	
                      
      (c)  

              	
                any
      matter or question connected with or arising out of any of the
      foregoing,

              


      

       

      but this
only applies to information that is (either at the date of the Agreement or at
the date of the request) in the possession of the Vendor or that the Vendor or
any of its professional advisers can reasonably be expected to obtain and
present without undue efforts.

       

      
        	
                5.8  

              	
                Disclosure
      in Disclosure Schedule

              


      

       

      The
Vendor shall not have any liability in respect of any Claim if and to the extent
that any fact, matter or circumstance that causes any of the Warranties to be
breached or that might result in a Claim or possible Claim has been Disclosed in
the Disclosure Schedule or otherwise in any of the Transaction Documents or
Relevant Documents.  The parties agree that the Disclosure made by the
documents listed in the Disclosure Schedule constitutes full, fair and express
disclosure of the facts, matters, transactions, rights, obligations, assets,
liabilities, arrangements, relationships and scope of information to which those
documents relate.

       

      
        
          
          

        

        
          9

          
            

          

        

        
          
          

        

      

      
        	
                5.9  

              	
                Notification
      of potential Claims before Closing

              


      

       

      If, at
any time before Closing, the Vendor becomes aware of any Claim or any matter
that could reasonably be expected to cause a Claim to arise or any matter that
at Closing would constitute a Claim or could reasonably be expected to cause a
Claim to arise, it shall forthwith disclose the same in writing to the
Purchaser.

       

      
        	
                5.10  

              	
                Organisation
      and good standing

              


      

       

      Each
party represents to the other party that it is duly formed, organised and
validly existing and in good standing under the laws of its jurisdiction of
incorporation.

       

      
        	
                5.11  

              	
                Due
      authorisation

              


      

       

      Each
party represents to the other party that it has all necessary power, authority
and capacity to enter into this Agreement and to perform its obligations under
this Agreement and the execution of this Agreement has been duly authorised by
all necessary action on its part.

       

      
        	
                5.12  

              	
                No
      Impediments

              


      

       

      To the
best knowledge of each party after making such diligent inquiry as may be
reasonable under the circumstances, neither party has any knowledge of any
impediment that might impact the sale and purchase of the Interests as
contemplated by this Agreement.

       

      
        	
                6  

              	
                REMEDIES
      OF THE PURCHASER

              


      

       

      
        	
                6.1  

              	
                Survival

              


      

       

      Subject
to the limitations and other provisions of this Agreement and the Transaction
Documents, the representations and warranties of the Vendor contained in this
Agreement (including the Schedules hereto), the Disclosure Schedule and the
Relevant Documents shall survive the Closing and remain in full force and effect
for a period of 12 months after the Closing Date; provided, however, that
the Warranties in paragraph 1(b), paragraph 1(c),
paragraph 11 (Taxation ) and paragraph 12(a)
of Schedule 3 (Warranties
and Representations ) to this Agreement shall
survive until, and shall terminate upon, the date of expiration of the
applicable statute of limitations with respect to the liability in
question.  The covenants and agreements of the Vendor contained in
this Agreement and the Transaction Documents that by their terms extend beyond
the Closing Date shall not terminate other until all obligations with respect
thereto have been performed or satisfied or shall have expired or been
terminated in accordance with their terms.

       

      
        	
                6.2  

              	
                Indemnification
      by the Vendor

              


      

       

      
        	
                6.2.1  

              	
                The
      Vendor agrees, subject to the other terms and conditions of this Agreement
      and the Transaction Documents, to indemnify each of the Purchaser, the
      Purchaser Group Companies and the Company against and hold it harmless
      from any and all:

              


      

       

      
        	
                      
      (a)  

              	
                losses
      and expenses to the Purchaser, any Purchaser Group Companies or the other
      Company arising out of or related to the breach of any representation,
      warranty, covenant or agreement of the Vendor in this Agreement (including
      the Schedules hereto), the Disclosure Schedule and the Transaction
      Documents, to the extent Vendor is notified by the Purchaser of such
      Losses or Expenses prior to expiration of the applicable survival period
      set forth in Clause 6.1 (Survival );

              


      

       

      
        
          
          

        

        
          10

          
            

          

        

        
          
          

        

      

      
        	
                      
      (b)  

              	
                Covered
      Environmental Losses relating to the Interests to the extent that the
      Vendor is notified by the Purchaser of any such Covered Environmental
      Losses within  five (5) years after the Closing
      Date;

              


      

       

      
        	
                      
      (c)  

              	
                Losses
      or Expenses to the Purchaser, the Purchaser Group Companies or the Company
      arising from:

              


      

       

      
        	
                                              (i)  

              	
                the
      failure of the Purchaser Group Companies, immediately after the Closing
      Date, to be the owner of such ownership interests in and to the Interests
      as are necessary to enable the Purchaser Group Companies to own and
      operate the Interests in substantially the same manner that the Interests
      were owned and operated by the Vendor Group Companies immediately prior to
      the Closing Date; or

              


      

       

      
        	
                                               (ii)  

              	
                the
      failure of the Purchaser Group Companies to have on the Closing Date any
      consent or governmental permit necessary to allow the Purchaser Group
      Companies to own or operate the Interests in substantially the same manner
      that the Interests were owned and operated by the Vendor Group Companies
      immediately prior to the Closing
Date,

              


      

       

      in each
of Clause 6.2.1(c)(i) and Clause 6.2.1(c)(ii), to the extent that the
Vendor is notified by the Purchaser of such Losses or Expenses within three (3)
years after the Closing Date; and

       

      
        	
                      
      (d)  

              	
                all
      federal, state, foreign and local income tax liabilities attributable to
      the operation of the Interests prior to the Closing
  Date.

              


      

       

      
        	
                6.2.2  

              	
                The
      aggregate liability of Vendor under Clause 6.2.1 shall not exceed $10
      million.  Furthermore, no claim may be made against Vendor for
      indemnification pursuant to Clause 6.2.1 unless the aggregate dollar
      amount of all claims for indemnification pursuant to such Clause shall
      exceed $500,000, in which case Vendor shall be liable for claims for
      indemnification only to the extent such aggregate amount exceeds
      $500,000.

              


      

       

      
        	
                6.3  

              	
                General
      Provisions

              


      

       

      
        	
                6.3.1  

              	
                The
      Purchaser agrees that within a reasonable period of time after it becomes
      aware of facts giving rise to a claim for indemnification pursuant to
      Clause 6.2 (Indemnification by the
      Vendor ), it will provide
      notice thereof in writing to the Vendor specifying the nature of and
      specific basis for such claim.

              


      

       

      
        	
                6.3.2  

              	
                The
      Vendor shall have the right to control all aspects of the defence of (and
      any counterclaims with respect to) any claims brought against the
      Purchaser the Purchaser Group Companies or the Company that are covered by
      the indemnification set forth in Clause 6.2 (Indemnification by the
      Vendor ), including,
      without limitation, the selection of counsel, determination of whether to
      appeal any decision of any court and the settling of any such matter or
      any issues relating thereto; provided, however, that no such settlement
      shall be entered into without the consent (which consent shall not be
      unreasonably withheld) of the Purchaser (with the concurrence of the
      conflicts committee of the Purchaser) unless it includes a full release of
      the Purchaser, the Purchaser Group Companies and the Company from such
      matter or issues, as the case may
be.

              


      

       

      
        
          
          

        

        
          11

          
            

          

        

        
          
          

        

      

      
        	
                6.3.3  

              	
                The
      Purchaser agrees to cooperate fully with the Vendor with respect to all
      aspects of the defence of any claims covered by the indemnification set
      forth in Clause 6.2 (Indemnification by the
      Vendor ), including,
      without limitation, the prompt furnishing to the Vendor of any
      correspondence or other notice relating thereto that the Purchaser, the
      Purchaser Group Companies or the Company may receive, permitting the names
      of such parties to be utilized in connection with such defence, the making
      available to the Vendor of any files, records or other information of such
      parties that the Vendor considers relevant to such defence and the making
      available to the Vendor of any employees of the Purchaser, the Purchaser
      Group Companies or the Company; provided, however, that in connection
      therewith the Vendor agrees to use reasonable efforts to minimize the
      impact thereof on the operations of such parties and further agrees to
      maintain the confidentiality of all files, records and other information
      furnished by any such party pursuant to this Clause 6.3 (General Provisions ).  In no
      event shall the obligation of the Purchaser to cooperate with the Vendor
      as set forth in the immediately preceding sentence be construed as
      imposing upon the Purchaser an obligation to hire and pay for counsel in
      connection with the defence of any claims covered by the indemnification
      set forth in this Clause 6 (Remedies of the
      Purchaser ); provided,
      however, that the Purchaser may, at its own option, cost and expense, hire
      and pay for counsel in connection with any such defence. The Vendor agrees
      to keep any such counsel hired by the Purchaser reasonably informed as to
      the status of any such defence (including providing such counsel with such
      information related to any such defence as such counsel may reasonably
      request) but the Vendor shall have the right to retain sole control over
      such defence.

              


      

       

      
        	
                6.3.4  

              	
                In
      determining the amount of any Loss or Expense for which the Purchaser, the
      Purchaser Group Companies or the Company is entitled to indemnification
      under this Agreement, the gross amount of the indemnification will be
      reduced by (i) any insurance proceeds realized by such parties, and such
      correlative insurance benefit shall be net of any incremental insurance
      premium that becomes due and payable by such parties as a result of such
      claim, and (ii) all amounts recovered by such parties under contractual
      indemnities from third persons. The Purchaser hereby agrees to use
      commercially reasonable efforts to realize any applicable insurance
      proceeds or amounts recoverable under such contractual indemnities;
      provided, however, that the costs and expenses (including, without
      limitation, court costs and reasonable attorneys' fees) of the Purchaser,
      the Purchaser Group Companies or the Company in connection with such
      efforts shall be promptly reimbursed by the Vendor in advance of any
      determination of whether such insurance proceeds or other amounts will be
      recoverable.

              


      

       

      
        	
                6.3.5  

              	
                The
      Purchaser hereby acknowledges and agrees that its sole and exclusive
      remedy with respect to any and all claims relating to the subject matter
      of this Agreement and the other Transaction Documents shall be pursuant to
      the indemnification provisions set forth in this Clause 6 (Remedies of the
      Purchaser ).  In
      furtherance of the foregoing, the Purchaser hereby waives, to the fullest
      extent permitted under applicable law, any and all rights, claims and
      causes of action it may have against the Vendor and the Vendor Group
      Companies arising under or based upon any federal, state, foreign or local
      statute, law, ordinance, rule or regulation (including, without
      limitation, any such rights, claims or causes of action arising under or
      based upon common law or
otherwise).

              


      

       

      
        	
                7  

              	
                IMPLEMENTATION

              


      

       

      
        	
                7.1  

              	
                Further
      assurances

              


      

       

      The
Vendor shall (and shall procure that any other relevant person shall) execute
any deeds or documents and exercise or waive any rights and generally take any
action, including passing (or procuring that there is passed) any resolution of
the Vendor or (whilst the Vendor remains the registered owner) the Company that
the Purchaser may reasonably require, which may be necessary for this Agreement
and the other Transaction Documents to be carried into effect.

       

      
        
          
          

        

        
          12

          
            

          

        

        
          
          

        

      

      
        	
                8  

              	
                COSTS

              


      

       

      
        	
                8.1  

              	
                Responsibility
      for costs

              


      

       

      Except
where expressly provided otherwise, each party shall pay its own costs connected
with the negotiation, preparation, execution and implementation of this
Agreement and the other Transaction Documents and any matters connected
therewith and investigating the affairs of the Company.

       

      
        	
                9  

              	
                OTHER
      PROVISIONS

              


      

       

      
        	
                9.1  

              	
                Entire
      agreement

              


      

      
         

      

      This
Agreement together with the other Transaction Documents constitutes the entire
agreement between the parties regarding the sale and purchase of the Interests
and related matters and supersedes any prior drafts, agreements, undertakings,
representations, warranties and arrangements of any kind, whether or not in
writing, regarding the same, all of which are hereby terminated and shall cease
to have effect in all respects, this Agreement and the parties confirm that
there are no collateral or supplemental agreements relating to the other
Transaction Documents, except as expressly set forth herein or
therein.

       

      
        	
                9.2  

              	
                Assignment

              


      

       

      
        	
                9.2.1  

              	
                This
      Agreement shall be binding on and enure for the benefit of each party’s
      successors and permitted assigns.  Save as provided in Clause
      9.2.2, no party shall, without the prior written consent of the other
      party, assign, transfer, charge or deal in any other manner with this
      Agreement or any of its rights (whether to damages or otherwise) or
      obligations arising under or in connection with the Agreement, or purport
      to do any of the same, nor sub-contract any or all of its obligations
      under this Agreement, and any such assignment, transfer, charge or dealing
      shall be void for all purposes.

              


      

       

      
        	
                9.2.2  

              	
                The
      Purchaser may assign all or any part of its rights and benefits under this
      Agreement to any Purchaser Group
Companies.

              


      

       

      
        	
                9.2.3  

              	
                Subject
      to and upon any succession or assignment permitted by this Agreement, any
      such successor or assignee shall in its own right be able to enforce any
      term of this Agreement in accordance with the terms of this Agreement as
      if it were a party, but until such time shall have no rights whether as a
      third party or otherwise.  The Vendor shall have no greater
      liabilities towards any successor or assignee of the Purchaser than it
      would have had to the Purchaser had the Purchaser remained fully and
      solely entitled under this
Agreement.

              


      

       

      
        	
                9.3  

              	
                Right
      of set-off, deductions and withholdings and Tax on
  payments

              


      

       

      
        	
                9.3.1  

              	
                The
      Purchaser shall not be entitled to set off against the Consideration any
      sums owing to it by the Vendor.

              


      

       

      
        	
                9.3.2  

              	
                If
      any deduction or withholding is required by law to be made from any
      payment from one party to another party under this Agreement or any other
      Transaction Document, the party making the payment shall increase the
      amount thereof so as to ensure that the recipient receives and is able to
      retain that amount that it would have received and retained had the
      payment not been the subject matter of such deduction or withholding
      provided always that if the recipient is entitled to a credit or some
      other benefit as a consequence of the payment to it being the subject
      matter of a deduction or withholding it shall use its reasonable
      endeavours to 

              


      

       

      
        
          
          

        

        
          13

          
            

          

        

        
          
          

        

      

      
         

        
          	
                  9.3.2  

                	
                  
                    utilise
      the credit (whether by set off, or by claiming a repayment in respect
      thereof, or otherwise) or benefit so arising and in the event that it is
      able so to do it shall repay to the party who made the payment an amount
      equal to the credit or benefit so utilised, provided always that this
      Clause is without prejudice to the limitations on the Vendor’s liabilities
      as set out in Clause 6 (Remedies of the
      Purchaser ).  For
      the avoidance of doubt, this Clause 9.3.2 shall not impose upon the
      recipient of the payment any obligation to utilise any credit or benefit
      in priority to any other economic credit or benefit available to it or to
      pay to the party making the payment an amount greater than that by which
      the original payment was increased under this Clause 9.3 (Right of set-off, deductions
      and withholdings and Tax on payments ).

                  

                


        

         

      

      
        	
                9.3.3  

              	
                If
      any payment from the Vendor to the Purchaser under this Agreement or any
      other Transaction Document is liable to Tax in the hands of the Purchaser,
      the Vendor shall increase the payment by such an amount as will ensure
      that the Purchaser is able to receive and retain, after paying Tax in
      respect of its receipt, an amount equal to that which would otherwise have
      been paid to it had the receipt not been subject to Tax in its hands,
      provided always that this Clause is without prejudice to the limitations
      on the Vendor’s liabilities as set out in Clause 6 (Remedies of the
      Purchaser ).  The
      parties shall agree to the amount of any increase in a relevant payment to
      give effect to this Clause 9.3 (Right of set-off, deductions
      and withholdings and Tax on payments ).  In the
      event that the parties are not able to agree the amount of any increase,
      the amount thereof shall be certified by the Purchaser’s auditors acting
      as experts whose decision in respect thereof shall be binding on the
      relevant parties except in the case of manifest
  error.

              


      

       

      
        	
                9.4  

              	
                Waivers,
      rights and remedies

              


      

       

      
        	
                9.4.1  

              	
                No
      failure or delay on the part of either party to this Agreement in
      exercising any right or remedy provided by law or under this Agreement
      shall impair such right or remedy or operate as a waiver or variation of
      it or preclude its exercise at any subsequent time and no single or
      partial exercise of any such right or remedy shall preclude or restrict
      any other or further exercise of it or the exercise of any other right or
      remedy.

              


      

       

      
        	
                9.4.2  

              	
                A
      waiver by either party to this Agreement of a breach of or default this
      Agreement or under any other Transaction Document shall not constitute a
      waiver of any other breach or default, shall not affect the other terms of
      this Agreement or any other Transaction Document or the rights of any
      other person thereto and shall not prevent the Purchaser from subsequently
      requiring compliance with the waived
obligation.

              


      

       

      
        	
                9.4.3  

              	
                Any
      waiver (in whole or in part) of any right or remedy under this Agreement
      must be set out in writing, signed by or on behalf of the person granting
      the waiver and may be given subject to any conditions thought fit by the
      grantor and, unless otherwise expressly stated, any waiver shall be
      effective only in the instance and only for the purpose for, and in favour
      of the person to, which it is
given.

              


      

       

      
        	
                9.4.4  

              	
                Unless
      specifically provided this Agreement and otherwise, the rights and
      remedies of the Purchaser and the Vendor under or pursuant to any other
      Transaction Document are cumulative, may be exercised as often as the
      Purchaser or the Vendor, as applicable considers appropriate and are in
      addition to its rights and remedies under the general
  law.

              


      

       

      
        	
                9.5  

              	
                Variations

              


      

       

      No
variation of this Agreement or any other Transaction Document shall be valid
unless it is agreed in writing and signed by or on behalf of each of the parties
thereto.

       

      
        
          
          

        

        
          14

          
            

          

        

        
          
          

        

      

      
        	
                9.6  

              	
                Effect
      of Closing 

              


      

       

      This
Agreement (other than obligations that have already been fully performed)
remains in full force after Closing.

       

      
        	
                9.7  

              	
                Provisions
      of Agreement severable

              


      

       

      If any
provisions of this Agreement or any other Transaction Document is, or becomes,
invalid, unenforceable or illegal, in whole or in part, under the laws of any
jurisdiction, such term or provision or part shall to that extent be deemed not
to form part of this Agreement or the relevant Transaction Document (as the case
may be), but the validity, enforceability or legality of the remaining
provisions of this Agreement or the relevant Transaction Document shall not be
impaired.

       

      
        	
                9.8  

              	
                Interest
      for late payment

              


      

       

      Any sum
owing by either party under this Agreement or any other Transaction Document
shall carry interest from (and excluding) the date on which it is payable until
(and including) the date of actual payment at the Specified
Rate.  Such interest will be compounded semi-annually and be payable
after as well as before any judgment.

       

      
        	
                9.9  

              	
                Counterparts

              


      

       

      This
Agreement and each of the other Transaction Documents may be entered into in any
number of counterparts and by the parties thereto on separate counterparts, each
of which when so executed and delivered shall be an original but each such
document shall not be effective until each party thereto has executed at least
one counterpart, but all the counterparts for document shall together constitute
one and the same instrument.

       

      
        	
                9.10  

              	
                Third
      party rights

              


      

       

      This
Agreement and the other Transaction Documents are made for the benefit of the
respective parties hereto and thereto and their successors and permitted assigns
only and are not intended to benefit, and no term thereof shall be enforceable
by, any other person by virtue of the Contracts (Rights of Third Parties) Act
1999.

       

      
        	
                10  

              	
                NOTICES

              


      

       

      
        	
                10.1  

              	
                General

              


      

       

      Any
notice under or in connection with this Agreement shall be in writing and may be
delivered by hand or fax to the address of the relevant party that is set out
below or to such other address as that party may have notified in writing from
time to time to the party serving the notice, which notice so served by fax
shall be deemed to have been received at the time of despatch:

       

      
        	
                                
      (a)  

              	
                         
      the Vendor

              


      

       

      Name:                             
        Teekay Corporation

       

      Address:                                 Suite
No. 1778,

      48 Par-la- Ville Road,

       

      
        
          
          

        

        
          15

          
            

          

        

        
          
          

        

      

      Hamilton, HM 11

      Bermuda

       

      Fax
Number:                           +011
441 292 3931

       

      marked
for the attention of the Corporate Secretary

       

      
        	
                                 
      (b)  

              	
                         
      the Purchaser

              


      

       

      Name:                                      Teekay
Tankers Ltd.

       

      Address:                                 Suite
No. 1778,

      48 Par-la-Ville Road,

      Hamilton, HM 11

      Bermuda

       

      Fax
Number:                           +011
441 292 3931

       

      marked
for the attention of the Corporate Secretary

       

      
        	
                11  

              	
                GOVERNING
      LAW AND JURISDICTION

              


      

       

      
        	
                11.1  

              	
                English
      law

              


      

       

      This
Agreement is governed by, and shall be construed in accordance with, English
law.

       

      
        	
                11.2  

              	
                Arbitration

              


      

       

      
        	
                11.2.1  

              	
                Any
      dispute arising out of this Agreement shall be referred to arbitration in
      London in accordance with the Arbitration Act 1996 and any statutory
      re-enactment or modification thereof before a sole arbitrator agreed by
      the parties or failing agreement within 7 days of receipt by one party of
      a notice (the “First
      Notice”) from the other proposing an arbitrator, a tribunal of
      three arbitrators comprising:

              


      

       

      
        	
                      
      (a)  

              	
                the
      arbitrator proposed in the First
Notice;

              


      

       

      
        	
                      
      (b)  

              	
                an
      arbitrator appointed by the party that received the First Notice;
      and

              


      

       

      
        	
                      
      (c)  

              	
                an
      arbitrator, who shall be the chairman, appointed by the two arbitrators
      referred to in Clause 11.2.1(a) and
      Clause 11.2.1(b).

              


      

       

      
        	
                11.2.2  

              	
                If
      the party receiving the First Notice does not within 14 days of receipt
      thereof notify the other party of its appointed arbitrator, the arbitrator
      referred to in Clause 11.2.1(a) shall be deemed appointed as sole
      arbitrator.

              


      

       

      
        	
                11.2.3  

              	
                Once
      appointed in relation to a dispute, a sole arbitrator or tribunal shall
      resolve all other disputes between the parties in relation to this
      Agreement, subject to the availability of the
    arbitrator(s).

              


      

       

      
        
          
          

        

        
          16

          
            

          

        

        
          
          

        

      

      
        	
                12  

              	
                TERMINATION

              


      

       

      
        	
                12.1  

              	
                Termination

              


      

       

      This
Agreement may be terminated upon written notice given at any time before the
Closing:

       

      
        	
                      
      (a)  

              	
                by
      the mutual written consent of Vendor and
  Purchaser;

              


      

       

      
        	
                      
      (b)  

              	
                by
      the Vendor, in the event of a material breach by the Purchaser of any
      representation, Warranty, covenant or agreement of the Purchaser contained
      herein that has not been cured or is not curable by the Closing Date;
      or

              


      

       

      
        	
                      
      (c)  

              	
                by
      the Purchaser, in the event of a material breach by the Vendor of any
      representation, Warranty, covenant or agreement of the Vendor contained
      herein that has not been cured or is not curable by the Closing
      Date.

              


      

       

      
        	
                12.2  

              	
                Effect
      of Termination

              


      

       

      In the
event of the termination of this Agreement pursuant to
Clause 12.1 (Termination ), the parties shall be
relieved of their obligations under this Agreement, save that
Clause 1 (Definitions and
Interpretation ) and
Clause 10 (Notices ) to
Clause 11 (Governing
Law and Jurisdiction ) shall continue in full
force and effect, and neither party shall have any claims against the other
party in connection with this Agreement except in respect of any accrued rights
or obligations arising under this Agreement before termination or in connection
with any antecedent breach by any party of any provision of this Agreement or
any breach by any party of any continuing provision of this
Agreement.

       

      In
witness whereof this Agreement has been executed by or on behalf of the parties
the day and year first above written.

       

      



      
        
           


        

        
          17

          
            

          

        

        
           


          
            


                                                                                                                                       Schedule
1 : Disclosure Schedule 

          

        

      


      


       

      Schedule
1

      Disclosure
Schedule

       

       

      
        	
                1  

              	
                Finance
      Documents

              


         

        


        
          	 
      	
                  Document

                	
                  Parties

                	
                  Date

                
	
                  1.

                	
                  Loan
      Agreement

                	
                  Borrowers
      / Lenders / Agent / Security Trustee / Mandated Lease Arrangers /
      Bookrunners / Swap Provider

                	
                  28.11.2007

                
	
                  2. 

                	
                  Guarantee
      and Indemnity in respect of the various obligations of the A Borrowers
      together with Deed of Release

                	
                  Guarantor
      B / Security Trustee

                  Guarantor
      B / Security Trustee

                	
                  28.11.2007

                  18.11.2007

                
	
                  3. 

                	
                  Guarantee
      and Indemnity in respect of the various obligations of the A
      Borrowers

                	
                  Guarantor
      A / Security Trustee

                	
                  18.11.2007

                
	
                  4. 

                	
                  Guarantee
      and Indemnity in respect of the various obligations of the B
      Borrowers

                	
                  Guarantor
      B / Security Trustee

                	
                  28.11.2007

                
	
                  5. 

                	
                  ISDA
      Master Agreement and schedule thereto

                	
                  A
      Borrowers / Swap Provider

                	
                  28.11.2007

                
	
                  6. 

                	
                  ISDA
      Novation Agreement

                	
                  A
      Borrowers / Swap Provider

                	
                  28.11.2007

                
	
                  7. 

                	
                  Pledge
      agreement in relation to the A Borrowers together with:

                	
                  Pledgor
      B / Security Trustee

                	
                  18.12.2007

                
	
                  7.1

                	
                  Irrevocable
      Proxies; and

                	
                  Pledgor
      B

                	
                  18.12.2007

                
	
                  7.2

                	
                  LLC
      Certificates

                	
                  A
      Borrowers

                	
                  18.12.2007

                
	
                  8. 

                	
                  Pledge
      Agreement in relation to the B Borrowers together with:

                	
                  Pledgor
      C / Security Trustee

                	
                  30.11.2007

                
	
                  8.1

                	
                  Irrevocable
      Proxy; and

                	
                  Pledgor
      C

                	
                  30.11.2007

                
	
                  8.2

                	
                  LLC
      Certificates

                	
                  B
      Borrowers

                	
                  21.11.2007

                
	
                  9. 

                	
                  First
      Priority Bahamas Ship Mortgage over m.v. “EVEREST SPIRIT” together
      with:

                	
                  Everest
      Spirit Holding L.L.C. / Security Trustee

                	
                  10.12.2007

                
	
                  9.1

                	
                  Transcript
      of Register

                	
                  BMA

                	
                  10.12.2007

                
	
                  10. 

                	
                  Deed
      of Covenants

                	
                  Everest
      Spirit Holding L.L.C. / Security Trustee

                	
                  10.12.2007

                


        

      

       

      
        
          
          

        

        
          18

          
            

          

        

        
          
          

        

      

       

      
        	
                11. 

              	
                Deed
      of Assignment together with:

              	
                Everest
      Spirit Holding L.L.C. / Security Trustee

              	
                10.12.2007

              
	
                11.1

              	
                Notice
      of Assignment

              	
                Everest
      Spirit Holding L.L.C.

              	
                10.12.2007

              
	
                11.2

              	
                Loss
      Payable Clause

              	
                Everest
      Spirit Holding L.L.C.

              	
                Undated

              
	
                12. 

              	
                First
      Priority Bahamas Ship Mortgage over m.v. “KANATA SPIRIT” together
      with:

              	
                Kanata
      Spirit Holding L.L.C. / Security Trustee

              	
                10.12.2007

              
	
                12.1

              	
                Transcript
      of Register

              	
                BMA

              	
                10.12.2007

              
	
                13. 

              	
                Deed
      of Covenants

              	
                Kanata
      Spirit Holding L.L.C. / Security Trustee

              	
                10.12.2007

              
	
                14. 

              	
                Deed
      of Assignment together with:

              	
                Kanata
      Spirit Holding L.L.C. / Security Trustee

              	
                10.12.2007

              
	
                14.1

              	
                Notice
      of Assignment; and

              	
                Kanata
      Spirit Holding L.L.C.

              	
                10.12.2007

              
	
                14.2

              	
                Loss
      Payable Clause

              	
                Kanata
      Spirit Holding L.L.C.

              	
                undated

              
	
                15. 

              	
                First
      Priority Bahamas Ship Mortgage over m.v. “KAREELA SPIRIT” together
      with:

              	
                Kareela
      Spirit Holding L.L.C. / Security Trustee

              	
                10.12.2007

              
	 
      	
                Transcript
      of Register

              	
                BMA

              	
                10.12.2007

              
	
                16. 

              	
                Deed
      of Covenants

              	
                Kareela
      Spirit Holding L.L.C. / Security Trustee

              	
                10.12.2007

              
	
                17. 

              	
                Deed
      of Assignment together with:

              	
                Kareela
      Spirit Holding L.L.C. / Security Trustee

              	
                10.12.2007

              
	
                17.1

              	
                Notice
      of Assignment; and

              	
                Kareela
      Spirit Holding L.L.C.

              	
                10.12.2007

              
	
                17.2

              	
                Loss
      Payable Clause

              	
                Kareela
      Spirit Holding L.L.C.

              	
                undated

              
	
                18. 

              	
                First
      Priority Bahamas Ship Mortgage over m.v. “KYEEMA SPIRIT” together
      with:

              	
                Kyeema
      Spirit Holding L.L.C. / Security Trustee

              	
                10.12.2007

              
	
                18.1

              	
                Transcript
      of Register

              	
                BMA

              	
                10.12.2007

              
	
                19. 

              	
                Deed
      of Covenants

              	
                Kyeema
      Spirit Holding L.L.C. / Security Trustee

              	
                10.12.2007

              
	
                20. 

              	
                Deed
      of Assignment together with:

              	
                Kyeema
      Spirit Holding L.L.C. / Security Trustee

              	
                10.12.2007

              


      

       

      
        
          
          

        

        
          19

          
            

          

        

        
          
          

        

      

       

      
        	
                20.1

              	
                Notice
      of Assignment; and

              	
                Kyeema
      Spirit Holding L.L.C.

              	
                10.12.2007

              
	
                20.2

              	
                Loss
      Payable Clause

              	
                Kyeema
      Spirit Holding L.L.C.

              	
                undated

              
	
                21. 

              	
                First
      Priority Bahamas Ship Mortgage over m.v. “NASSAU SPIRIT” together
      with:

              	
                Nassau
      Spirit Holding L.L.C. / Security Trustee

              	
                10.12.2007

              
	
                21.1

              	
                Transcript
      of Register

              	
                BMA

              	
                10.12.2007

              
	
                22. 

              	
                Deed
      of Covenants

              	
                Nassau
      Spirit Holding L.L.C. / Security Trustee

              	
                10.12.2007

              
	
                23. 

              	
                Deed
      of Assignment together with:

              	
                Nassau
      Spirit Holding L.L.C. / Security Trustee

              	
                10.12.2007

              
	
                23.1

              	
                Notice
      of Assignment; and

              	
                Nassau
      Spirit Holding L.L.C.

              	
                10.12.2007

              
	 
      	
                Loss
      Payable Clause

              	
                Nassau
      Spirit Holding L.L.C.

              	
                undated

              
	
                24. 

              	
                First
      Priority Bahamas Ship Mortgage over m.v. “FALSTER SPIRIT” together
      with:

              	
                Falster
      Spirit Holding L.L.C. / Security Trustee

              	
                10.12.2007

              
	
                24.1

              	
                Transcript
      of Register

              	
                BMA

              	
                10.12.2007

              
	
                25. 

              	
                Deed
      of Covenants

              	
                Falster
      Spirit Holding L.L.C. / Security Trustee

              	
                10.12.2007

              
	
                26. 

              	
                Deed
      of Assignment together with:

              	
                Falster
      Spirit Holding L.L.C. / Security Trustee

              	
                10.12.2007

              
	
                26.1

              	
                Notice
      of Assignment; and

              	
                Falster
      Spirit Holding L.L.C.

              	
                10.12.2007

              
	
                26.2

              	
                Loss
      Payable Clause

              	
                Falster
      Spirit Holding L.L.C.

              	
                undated

              
	
                27. 

              	
                First
      Priority Bahamas Ship Mortgage over m.v. “SOTRA SPIRIT” together
      with:

              	
                Sotra
      Spirit Holding L.L.C. / Security Trustee

              	
                10.12.2007

              
	
                27.1

              	
                Transcript
      of Register

              	
                BMA

              	
                10.12.2007

              
	
                28. 

              	
                Deed
      of Covenants

              	
                Sotra
      Spirit Holding L.L.C. / Security Trustee

              	
                10.12.2007

              
	
                29. 

              	
                Deed
      of Assignment together with:

              	
                Sotra
      Spirit Holding L.L.C. / Security Trustee

              	
                10.12.2007

              
	
                29.1

              	
                Notice
      of Assignment; and

              	
                Sotra
      Spirit Holding L.L.C.

              	
                10.12.2007

              


      

       

      
        
          
          

        

        
          20

          
            

          

        

        
          
          

        

      

       

      
        	
                29.2

              	
                Loss
      Payable Clause

              	
                Sotra
      Spirit Holding L.L.C.

              	
                undated

              
	
                30. 

              	
                First
      Priority Bahamas Ship Mortgage over m.v. “GODAVARI SPIRIT” together
      with:

              	
                Godavari
      Spirit Holding L.L.C. / Security Trustee

              	
                30.11.2007

              
	
                30.1

              	
                Transcript
      of Register

              	
                BMA

              	
                30.11.2007

              
	
                31. 

              	
                Deed
      of Covenants

              	
                Godavari
      Spirit Holding L.L.C. / Security Trustee

              	
                30.11.2007

              
	
                32. 

              	
                Deed
      of Assignment together with:

              	
                Godavari
      Spirit Holding L.L.C. / Security Trustee

              	
                30.11.2007

              
	
                32.1

              	
                Notice
      of Assignment; and

              	
                Godavari
      Spirit Holding L.L.C.

              	
                30.11.2007

              
	
                32.2

              	
                Loss
      Payable Clause

              	
                Godavari
      Spirit Holding L.L.C.

              	
                undated

              
	
                33. 

              	
                First
      Priority Bahamas Ship Mortgage over m.v. “ISKMATI SPIRIT” together
      with:

              	
                Iskmati
      Spirit Holding L.L.C. / Security Trustee

              	
                30.11.2007

              
	
                33.1

              	
                Transcript
      of Register

              	
                BMA

              	
                30.11.2007

              
	
                34. 

              	
                Deed
      of Covenants

              	
                Iskmati
      Spirit Holding L.L.C. / Security Trustee

              	
                30.11.2007

              
	
                35. 

              	
                Deed
      of Assignment together with:

              	
                Iskmati
      Spirit Holding L.L.C. / Security Trustee

              	
                30.11.2007

              
	
                35.1

              	
                Notice
      of Assignment; and

              	
                Iskmati
      Spirit Holding L.L.C.

              	
                30.11.2007

              
	
                35.2

              	
                Loss
      Payable Clause

              	
                Iskmati
      Spirit Holding L.L.C.

              	
                undated

              
	
                36. 

              	
                First
      Priority Bahamas Ship Mortgage over m.v. “ASHKINI SPIRIT” together
      with:

              	
                Ashkini
      Spirit Holding L.L.C. / Security Trustee

              	
                30.11.2007

              
	
                36.1

              	
                Transcript
      of Register

              	
                BMA

              	
                30.11.2007

              
	
                37. 

              	
                Deed
      of Covenants

              	
                Ashkini
      Spirit Holding L.L.C. / Security Trustee

              	
                30.11.2007

              
	
                38. 

              	
                Deed
      of Assignment together with:

              	
                Ashkini
      Spirit Holding L.L.C. / Security Trustee

              	
                30.11.2007

              
	
                38.1

              	
                Notice
      of Assignment

              	
                Ashkini
      Spirit Holding L.L.C.

              	
                30.11.2007

              
	
                38.2

              	
                Loss
      Payable Clause

              	
                Ashkini
      Spirit Holding L.L.C.

              	
                undated

              
	
                39. 

              	
                First
      Priority Bahamas Ship Mortgage over m.v. “NARMADA SPIRIT” together
      with:

              	
                Narmada
      Spirit Holding L.L.C. / Security Trustee

              	
                30.11.2007

              


      

       

       

      
        
          
          

        

        
          21

          
            

          

        

        
          
          

        

      

       

      
        	
                39.1

              	
                Transcript
      of Register

              	
                BMA

              	
                30.11.2007

              
	
                40. 

              	
                Deed
      of Covenants

              	
                Narmada
      Spirit Holding L.L.C. / Security Trustee

              	
                30.11.2007

              
	
                41. 

              	
                Deed
      of Assignment together with:

              	
                Narmada
      Spirit Holding L.L.C. / Security Trustee

              	
                30.11.2007

              
	
                41.1

              	
                Notice
      of Assignment; and

              	
                Narmada
      Spirit Holding L.L.C.

              	
                30.11.2007

              
	
                41.2

              	
                Loss
      Payable Clause

              	
                Narmada
      Spirit Holding L.L.C.

              	
                undated

              
	
                42. 

              	
                First
      Priority Bahamas Ship Mortgage over m.v. “KAVERI SPIRIT” together
      with:

              	
                Kaveri
      Spirit Holding L.L.C. / Security Trustee

              	
                30.11.2007

              
	
                42.1

              	
                Transcript
      of Register

              	
                BMA

              	
                30.11.2007

              
	
                43. 

              	
                Deed
      of Covenants

              	
                Kaveri
      Spirit Holding L.L.C. / Security Trustee

              	
                30.11.2007

              
	
                44. 

              	
                Deed
      of Assignment together with:

              	
                Kaveri
      Spirit Holding L.L.C. / Security Trustee

              	
                30.11.2007

              
	
                44.1

              	
                Notice
      of Assignment

              	
                Kaveri
      Spirit Holding L.L.C.

              	
                30.11.2007

              
	
                44.2

              	
                Loss
      Payable Clause

              	
                Kaveri
      Spirit Holding L.L.C.

              	
                undated

              
	
                45. 

              	
                First
      Priority Bahamas Ship Mortgage over m.v. “GANGES SPIRIT” together
      with:

              	
                Ganges
      Spirit Holding L.L.C. / Security Trustee

              	
                30.11.2007

              
	
                45.1

              	
                Transcript
      of Register

              	
                BMA

              	
                30.11.2007

              
	
                46. 

              	
                Deed
      of Covenants

              	
                Ganges
      Spirit Holding L.L.C. / Security Trustee

              	
                30.11.2007

              
	
                47. 

              	
                Deed
      of Assignment together with:

              	
                Ganges
      Spirit Holding L.L.C. / Security Trustee

              	
                30.11.2007

              
	
                47.1

              	
                Notice
      of Assignment

              	
                Ganges
      Spirit Holding L.L.C.

              	
                30.11.2007

              
	
                47.2

              	
                Loss
      Payable Clause

              	
                Ganges
      Spirit Holding L.L.C.

              	
                undated

              
	
                48. 

              	
                First
      Priority Bahamas Ship Mortgage over m.v. “YAMUNA SPIRIT” together
      with:

              	
                Yamuna
      Spirit Holding L.L.C. / Security Trustee

              	
                30.11.2007

              
	
                48.1

              	
                Transcript
      of Register

              	
                BMA

              	
                30.11.2007

              


      

       

      
        
          
          

        

        
          22

          
            

          

        

        
          
          

        

      

       

      
        	
                49. 

              	
                Deed
      of Covenants

              	
                Yamuna
      Spirit Holding L.L.C. / Security Trustee

              	
                30.11.2007

              
	
                50. 

              	
                Deed
      of Assignment together with:

              	
                Yamuna
      Spirit Holding L.L.C. / Security Trustee

              	
                30.11.2007

              
	
                50.1

              	
                Notice
      of Assignment

              	
                Yamuna
      Spirit Holding L.L.C.

              	
                30.11.2007

              
	
                50.2

              	
                Loss
      Payable Clause

              	
                Yamuna
      Spirit Holding L.L.C.

              	
                undated

              
	
                51. 

              	
                First
      Priority Bahamas Ship Mortgage over m.v. “LUIT SPIRIT” together
      with:

              	
                Luit
      Spirit Holding L.L.C. / Security Trustee

              	
                30.11.2007

              
	
                51.1

              	
                Transcript
      of Register

              	
                BMA

              	
                30.11.2007

              
	
                52. 

              	
                Deed
      of Covenants

              	
                Luit
      Spirit Holding L.L.C. / Security Trustee

              	
                30.11.2007

              
	
                53. 

              	
                Deed
      of Assignment together with:

              	
                Luit
      Spirit Holding L.L.C. / Security Trustee

              	
                30.11.2007

              
	
                53.1

              	
                Notice
      of Assignment

              	
                Luit
      Spirit Holding L.L.C.

              	
                30.11.2007

              
	
                53.2

              	
                Loss
      Payable Clause

              	
                Luit
      Spirit Holding L.L.C.

              	
                undated

              
	
                54. 

              	
                First
      Priority Bahamas Ship Mortgage over m.v. “TEESTA SPIRIT” together
      with:

              	
                Teesta
      Spirit Holding L.L.C. / Security Trustee

              	
                30.11.2007

              
	
                54.1

              	
                Transcript
      of Register

              	
                BMA

              	
                30.11.2007

              
	
                55. 

              	
                Deed
      of Covenants

              	
                Teesta
      Spirit Holding L.L.C. / Security Trustee

              	
                30.11.2007

              
	
                56. 

              	
                Deed
      of Assignment together with:

              	
                Teesta
      Spirit Holding L.L.C. / Security Trustee

              	
                30.11.2007

              
	
                56.1

              	
                Notice
      of Assignment

              	
                Teesta
      Spirit Holding L.L.C.

              	
                30.11.2007

              
	
                56.2

              	
                Loss
      Payable Clause

              	
                Teesta
      Spirit Holding L.L.C.

              	
                undated

              
	
                57. 

              	
                First
      Priority Bahamas Ship Mortgage over m.v. “MAHANADI SPIRIT” together
      with:

              	
                Mahanadi
      Spirit Holding L.L.C. / Security Trustee

              	
                30.11.2007

              
	
                57.1

              	
                Transcript
      of Register

              	
                BMA

              	
                30.11.2007

              
	
                58. 

              	
                Deed
      of Covenants

              	
                Mahanadi
      Spirit Holding L.L.C. / Security Trustee

              	
                30.11.2007

              
	
                59. 

              	
                Deed
      of Assignment together with:

              	
                Mahanadi
      Spirit Holding L.L.C. / Security Trustee

              	
                30.11.2007

              


      

       

      
        
          
          

        

        
          23

          
            

          

        

        
          
          

        

      

       

      
        	
                59.1

              	
                Notice
      of Assignment

              	
                Mahanadi
      Spirit Holding L.L.C.

              	
                30.11.2007

              
	
                59.2

              	
                Loss
      Payable Clause

              	
                Mahanadi
      Spirit Holding L.L.C.

              	
                undated

              
	
                60. 

              	
                First
      Priority Bahamas Ship Mortgage over m.v. “ESTHER SPIRIT” together
      with:

              	
                Esther
      Spirit Holding L.L.C. / Security Trustee

              	
                30.11.2007

              
	
                60.1

              	
                Transcript
      of Register

              	
                BMA

              	
                30.11.2007

              
	
                61. 

              	
                Deed
      of Covenants

              	
                Esther
      Spirit Holding L.L.C. / Security Trustee

              	
                30.11.2007

              
	
                62. 

              	
                Deed
      of Assignment together with:

              	
                Esther
      Spirit Holding L.L.C. / Security Trustee

              	
                30.11.2007

              
	
                62.1

              	
                Notice
      of Assignment

              	
                Esther
      Spirit Holding L.L.C.

              	
                30.11.2007

              
	
                62.2

              	
                Loss
      Payable Clause

              	
                Esther
      Spirit Holding L.L.C.

              	
                undated

              
	
                63. 

              	
                First
      Priority Bahamas Ship Mortgage over m.v. “AXEL SPIRIT” together
      with:

              	
                Axel
      Spirit Holding L.L.C. / Security Trustee

              	
                30.11.2007

              
	
                63.1

              	
                Transcript
      of Register

              	
                BMA

              	
                30.11.2007

              
	
                64. 

              	
                Deed
      of Covenants

              	
                Axel
      Spirit Holding L.L.C. / Security Trustee

              	
                30.11.2007

              
	
                65. 

              	
                Deed
      of Assignment together with:

              	
                Axel
      Spirit Holding L.L.C. / Security Trustee

              	
                30.11.2007

              
	
                65.1

              	
                Notice
      of Assignment

              	
                Axel
      Spirit Holding L.L.C.

              	
                30.11.2007

              
	
                65.2

              	
                Loss
      Payable Clause

              	
                Axel
      Spirit Holding L.L.C.

              	
                undated

              


      

       

      



      
        
           


        

        
          24

          
            

          

        

        
           


          
            


                                                                                                                                       Schedule
1 : Disclosure Schedule 

          

        

      


       

      
        	
                2  

              	
                Vessel
      Documents

              


      

       

      
        
          	
                  2.1

                	
                  BP
      Time3 Time Charter Party dated 30 June 2006 made between (i) Narmada
      Spirit L.L.C. and (ii) BP Shipping
Ltd;

                


        
                                                              

      
        
          	
                  2.2 

                	BMA Transcript of
      Register dated 30 November 2007;


        

        
           

          
            	
                     2.3

                  	BMA Provisional
      Certificate of Registry dated 11 September
2007;


          

          
             

            
              	
                       2.4

                    	BMA Ship Radio
      Communication Licence dated 11 September
2007;


            

            
               

              
                	
                         2.5  

                      	BMA Minimum Safe
      Manning Document dated 11 September 2007;


              

              
                 

                
                  	
                           2.6  

                        	COFR Certificate
      dated 11 September 2007;


                

                
                   

                  
                    	
                             2.7 

                          	BMA Carving and
      Marking Note dated 11 September 2007;


                  

                  
                     

                    
                      	
                               2.8

                            	ABS Class
      Certificate dated 18 December 2003;


                    

                    
                       

                      
                        	
                                 2.9

                              	Marshall Islands
      Permanent Certificate of Registration dated 8 March
  2005;


                      

                      
                         

                        
                          	
                                   2.10

                                	Marshall Islands
      Certificate of Ownership and Encumbrance dated 18 July 2007;
  and


                        

                        
                          
                             

                            
                              	
                                       2.11

                                    	Inspection report
      dated 3 - 6 February 2008 in relation to m.v. “NARMADA
  SPIRIT”.


                            

                             

                          

                        

                      

                    

                  

                

              

            

          

        

      

                     

       

      
        
           


        

        
          25

          
            

          

        

        
           


          
            


                                                                                                                                       Schedule
2 : The Interests Transfer Documents 

          

        

      


      


       

      Schedule
2

      The
Interests Transfer Documents

       

       

      Certificate
of Limited Liability Interest of Narmada Spirit L.L.C., signed by its member,
Teekay Tankers Ltd. and duly endorsed by the Vendor for transfer to the
Purchaser.

       

      


       

      



      
        
           


        

        
          26

          
            

          

        

        
           


          
            


                                                                                                                                       Schedule
3 : Warranties and Representations 

          

        

      


      


       

      Schedule
3

      Warranties
and Representations

       

       

      
      

       

      
        	
                1  

              	
                The
      Company and the Interests

              


      

       

      
        	
                (a)  

              	
                Information

              


      

       

      The
Company is duly formed and validly existing under the laws of The Republic of
the Marshall Islands.  The Company has the requisite power and
authority to own and operate its properties and assets and to carry on its
business.

       

      
        	
                (b)  

              	
                Title
      to Interests

              


      

       

      The
Interests constitute 100% of the issued capital of the Company, the Vendor is
the sole legal and beneficial owner of the Interests, and no claim has been made
by any person to be entitled to any of them.  The Interests have been
duly authorized, properly allotted and validly issued and are fully paid, or
credited as fully paid, and non-assessable.  Save as Disclosed there
is no Security Interest, option, conversion right, right to acquire, or other
adverse interest, right, equity, claim or potential claim of any description on
or over or affecting any of the Interests nor are there any agreements,
arrangements or commitments to give or create any such Security Interest, right
or claim, and no claim has been made by any person to be entitled to
any.

       

      
        	
                (c)  

              	
                No
      arrangements relating to share
capital

              


      

       

      The
Company has not created or issued any shares or equity interests (other than the
Interests). There is no agreement, arrangement, obligation or commitment
(including an option or right of pre-emption or conversion) requiring or
granting any person the right to require the creation, allotment, issue,
transfer, redemption or repayment of, or creating or requiring the creation of
any Security Interest over, or requiring the grant to a person of the right
(conditional or not) to require the allotment, issue, transfer, redemption or
repayment of, any shares, equity or loan capital in the Company (or any unissued
shares, equity capital, loan capital or other securities of the Company) now or
at any time in the future, and the Company has not agreed to do or enter into
any of the foregoing and no person has made any claim to be entitled to any of
the foregoing.

       

      
        	
                (d)  

              	
                No
      capital reorganisation

              


      

       

      The
Company has not since its incorporation or formation:

       

      
        	
                                        
      (i)            
      

              	
                made
      any issue of securities by way of capitalisation of profits or reserves
      (including share premium account and capital redemption reserve);
      or

              


      

       

      
        	
                (ii)    
             

              	
                repaid,
      purchased or redeemed any shares of any class of its share capital or
      otherwise reduced its share capital or any class of
  it;

              


      

       

      and not
agreed to do any of the foregoing (whether at the option of any other person or
otherwise).

       

      
        	
                (e)  

              	
                No
      agreement/arrangement

              


      

       

      Save as
Disclosed, neither the Vendor nor the Company are party to any agreement or
arrangement concerning:

       

      
        
          
          

        

        
          27

          
            

          

        

        
          
          

        

      

      
        	
                (i)         
        

              	
                the
      transfer or disposal of the Interests or any interest therein or any
      restriction thereon or obligation relating
  thereto;

              


      

       

      
        	
                (ii)        
        

              	
                the
      exercise of votes at meetings of the board of the Company (if any) or of
      the holders of any class of Interests;
or

              


      

       

      
        	
                (iii)       
        

              	
                the
      right to appoint or remove any directors or officers of the Company (where
      applicable).

              


      

       

      
        	
                (f)  

              	
                No
      Security Interest over assets

              


      

       

      Save as
Disclosed, There is no Security Interest (other than liens arising in the usual
course of business consistent with past practices) affecting the whole or any
material part of the assets of the Company.

       

      
        	
                2  

              	
                The
      Vendor

              


      

       

      
        	
                (a)  

              	
                Capacity
      of Vendor

              


      

       

      As
regards the Vendor:

       

      
        	
                    
      (i)  

              	
                it
      has the requisite power and authority to enter into this Agreement and the
      Transaction Documents to which it is a party and perform all its
      obligations thereunder;

              


      

       

      
        	
                     
      (ii)  

              	
                this
      Agreement and the Transaction Documents to which it is a party constitute
      (or will constitute when executed) its legal, valid and binding
      obligations enforceable against it in accordance with their
      terms;

              


      

       

      
        	
                      
      (iii)  

              	
                it
      has the power and authority to absolutely and unconditionally sell and
      transfer the full legal and beneficial ownership in the Interests
      registered in its name to the Purchaser on the terms set out in this
      Agreement;

              


      

       

      
        	
                       (iv)  

              	
                the
      execution and delivery of this Agreement and the Transaction Documents and
      performance by it of the obligations thereunder do not and will not result
      in a breach of, or constitute any default under, any law or regulation,
      any order, judgement or decree by any court or governmental agency to
      which it is a party or by which it is bound, its Articles of Incorporation
      and Bylaws or any agreement to which it is a
  party;

              


      

       

      
        	
                      
      (v)  

              	
                all
      consents, licences, approvals and authorisations required by it in
      connection with this Agreement and the Transaction Documents to which it
      is a party and the transactions contemplated thereby have been obtained
      and are in full force and effect;

              


      

       

      
        	
                       
      (vi)  

              	
                no
      action, suit, proceeding, litigation or dispute against it or any Vendor
      Group Companies is presently taking place or pending or, to its knowledge,
      threatened that would or might reasonably be expected to inhibit its
      ability to perform its obligations under this Agreement and the
      Transaction Documents to which it is a party or that could materially and
      adversely affect the Interests; and

              


      

       

      
        	
                        
      (vii)  

              	
                in
      so far as it is a body corporate:

              


      

       

      
        	
                                                
      (A)  

              	
                it
      is a body corporate duly incorporated and validly existing under the laws
      of the jurisdiction in which it is
incorporated;

              


      

       

      
        
          
          

        

        
          28

          
            

          

        

        
          
          

        

      

      
        	
                                               
      (B)  

              	
                no
      Insolvency Event has occurred in relation to it and no events or
      circumstances have arisen that entitle or could entitle any person to take
      any action, appoint any person, commence proceedings or obtain any order
      instigating an Insolvency Event.

              


      

       

      
        	
                (b)  

              	
                Vendor/Company
      relationship

              


      

       

      Save as
Disclosed, neither the Vendor, nor any Vendor Group Companies:

       

      
        	
                    
      (i)  

              	
                owe
      any indebtedness or other liability and which in aggregate exceeds
      $100,000 to the Company whether actually or contingently, whether solely
      or jointly with any other person and whether as principal or surety, and
      there is no such indebtedness or liability and which in aggregate exceeds
      $100,000 due or owing by the Company to the Vendor, or any Vendor Group
      Companies and there is no guarantee or Security Interest in respect of any
      such indebtedness or liability
outstanding;

              


      

       

      
        	
                      (ii)  

              	
                are
      party to any agreement, arrangement or understanding, other than this
      Agreement and the Transaction Documents, with the Company or relating to
      the Company or the Interests in which the Vendor, any Vendor Group
      Companies is or has been interested, whether directly or indirectly, and
      there is no agreement, arrangement or understanding to which the Company
      is a party and in which the Vendor, or any Vendor Group Companies has or
      has had an interest, whether directly or indirectly;
  or

              


      

       

      
        	
                      
      (iii)  

              	
                is
      entitled to a claim of any nature against the Company, or which
      individually does not exceed $100,000, or has assigned to any person the
      benefit of a claim against the Company to which it would otherwise be
      entitled.

              


      

       

      
        	
                3  

              	
                Agreements

              


      

       

      
        	
                (a)  

              	
                Disclosure
      of Relevant Documents

              


      

       

      Complete
and accurate copies of all Relevant Documents (including all amendments and
supplemental agreements relating thereto) have been provided to the Purchaser
and all Relevant Documents are set out in the Disclosure Schedule.

       

      
        	
                (b)  

              	
                Enforceability
      of and compliance with agreements

              


      

       

      In
relation to each Relevant Document:

       

      
        	
                    
      (i)  

              	
                the
      Vendor has no reason to believe that the Company will be unable to
      complete and fulfil each of the Relevant Documents by the due date and in
      accordance with its terms;

              


      

       

      
        	
                     
      (ii)  

              	
                the
      Company is in the possession or in the control of each Relevant
      Document;

              


      

       

      
        	
                      
      (iii)  

              	
                so
      far as the Vendor is aware, there are no written or oral agreements that
      derogate from the obligations of any person other than the Company or
      increase the obligations of the Company under the Relevant
      Documents;

              


      

       

      
        	
                      
      (iv)  

              	
                each
      Relevant Document has been validly executed by the Company, is valid and
      subsisting, has not been terminated and is fully enforceable against the
      Company and, to the Vendor's knowledge, the other parties to such
      agreement in accordance with its
terms;

              


      

       

      
        
          
          

        

        
          29

          
            

          

        

        
          
          

        

      

      
        	
                      (v)  

              	
                none
      of such Relevant Documents is subject to a Security Interest granted or
      created by the Company or the Vendor Group Companies other than under the
      terms of the Relevant Document;

              


      

       

      
        	
                      
      (vi)  

              	
                to
      the Vendor's knowledge, there is no and has not been, at any time, any
      breach of, or any default in the performance of, the terms of any such
      Relevant Documents by any person other than the Company nor are there any
      circumstances likely to give rise to such breach or default. The Company
      has not granted any time or indulgence, or waived any right, in relation
      to any Relevant Document and, in particular, but without prejudice to the
      generality of the foregoing, all amounts due and payable under such
      agreements have been duly paid in full on, or within a reasonable period
      of, the due date for payment of the
same;

              


      

       

      
        	
                       
      (vii)  

              	
                so
      far as the Vendor is aware, the Company has fulfilled all of its
      obligations and performed and observed all warranties, undertakings,
      covenants and agreements on its part to be fulfilled, performed and
      observed under each Relevant
Document;

              


      

       

      
        	
                        
      (viii)  

              	
                no
      notice of any intention to terminate, repudiate, rescind, modify or
      disclaim any provision of any Relevant Document has been given by the
      Company or, so far as the Vendor is aware, received from a person other
      than the Company by the Company in respect of any Relevant
      Document;

              


      

       

      
        	
                     
      (ix)  

              	
                so
      far as the Vendor is aware, the Company has paid all Taxes, duties,
      imposts and other charges payable in respect of the Relevant Documents so
      far as such Taxes, duties, imposts and other charges fall upon the Company
      and have become due and payable;

              


      

       

      
        	
                    
      (x)  

              	
                all
      necessary licences, approvals and consents required by the Company prior
      to the entry into of each of the Relevant Documents and for their
      continuation were duly obtained and are subsisting and, to the Vendor's
      knowledge, no circumstances have arisen that may lead to withdrawal or
      failure to renew, if applicable, of any such licence, approval or
      consent;

              


      

       

      
        	
                     
      (xi)  

              	
                there
      are no disputes or outstanding claims pending or, to the Vendor's
      knowledge, threatened against the Company under the Relevant Documents
      and, to the Vendor's knowledge, no person is entitled to make, or has
      threatened to make, a claim against the Company in respect of any
      representation, breach of condition or warranty or other express or
      implied term relating to any of the Relevant Documents and no matter
      exists that would or might enable a person other than the Company to make
      such a claim or raise a set-off, deduction, withholding or counterclaim in
      any action for breach of any Relevant Document or otherwise give any
      person other than the Company the right to withhold or delay payment of
      any sum due from it under the terms of the Relevant Document or the
      performance of any of its obligations
  thereunder;

              


      

       

      
        	
                      
      (xii)  

              	
                so
      far as the Vendor is aware, no person (other than the parties to the
      Relevant Documents) has any rights (including any Security Interests) in
      respect of any such Transaction Documents or the assets the subject
      thereof;

              


      

       

      
        	
                       
      (xiii)  

              	
                the
      execution of this Agreement by the Vendor and the exercise of its rights
      and performance of its obligations under the Agreement does not constitute
      and will not result in any breach of any Relevant Document or other
      agreement or treaty to which the Vendor or the Company are a
      party;

              


      

       

      
        
          
          

        

        
          30

          
            

          

        

        
          
          

        

      

      
        	
                        
      (xiv)  

              	
                the
      obligations expressed to be assumed by the Vendor in this Agreement are
      legal and valid obligations, binding on them in accordance with the terms
      of this Agreement and no limit on any of their powers will be exceeded as
      a result of the transaction contemplated by this Agreement or the
      performance by the Vendor, of its obligations herein;
  and

              


      

       

      
        	
                        (xv)  

              	
                so
      far as the Vendor is aware, no Insolvency Event has occurred in relation
      to any third party to any Relevant
Documents.

              


      

       

      
        	
                (c)  

              	
                No
      powers of attorney

              


      

       

      There are
in force no powers of attorney given by the Company nor any other authority
(express, implied or ostensible) given by the Company to or in favour of any
person (as agent or otherwise) to enter into any agreement, contract or
commitment or to do anything on their behalf except as set out in the Disclosure
Schedule.  The Disclosure Schedule sets out details of all persons who
have authority to bind the Company in the ordinary course of their
business.

       

      
        	
                (d)  

              	
                Change
      of control

              


      

       

      Neither
the sale of the Interests hereunder nor any change in the management of the
Company as a result of this Agreement will:

       

      
        	
                     (i)  

              	
                entitle
      any person to modify or terminate any Relevant Document or other
      arrangement with the Company;

              


      

       

      
        	
                      (ii)  

              	
                result
      in the breach by the Companies under any of the terms, conditions or
      provisions of any Relevant Document or other instrument to which the
      Company is now a party;

              


      

       

      
        	
                      
      (iii)  

              	
                result
      in any present or future Indebtedness becoming due and payable or capable
      of being declared due and payable prior to its stated maturity;
      or

              


      

       

      
        	
                      
      (iv)  

              	
                entitle
      any person to receive from the Company any finder’s fee, brokerage or
      other commission in connection with the sale of the
    Interests.

              


      

       

      
        	
                (e)  

              	
                Offers
      and tenders

              


      

       

      No offer
or tender or similar arrangement given or made by the Company is capable of
giving rise to an agreement solely by the unilateral act of any person other
than the Company.

       

      
        	
                (f)  

              	
                Joint
      Ventures etc

              


      

       

      The
Company does not and has not agreed to, act or carry on business in partnership
with any other person and are not and have not agreed to act or become a member
of any joint venture, consortium, corporate or unincorporated body, association
or undertaking.

       

      
        	
                (g)  

              	
                Competition/Anti-trust

              


      

       

      The
Company is not party to any practice, arrangement or agreement that infringes or
is likely to require registration or notification under any relevant anti-trust
or competition law.

       

      
        	
                (h)  

              	
                Restrictive
      practices

              


      

       

      
        
          
          

        

        
          31

          
            

          

        

        
          
          

        

      

      The
Company is not and has not been a party to any agreement, arrangement,
understanding or practice restricting the freedom of the Company to carry on the
whole or any part of their business in any place in such manner as they think
fit or to provide or take goods and/or services by such means and from and to
such persons and into or from such places as they may from time to time think
fit and/or to compete in any area or in any field or with any
person.

       

      
        	
                (i)  

              	
                Directors
      or Officers

              


      

       

      The
management of the Company is vested exclusively in its members.  The
Vendor is, and the Purchaser shall be upon the Closing, the sole member of the
Company with, in its capacity as sole member, authority to make all decisions
and take all actions for the Company as, in its sole discretion, it shall deem
necessary and appropriate to enable  the Company to carry out any
lawful activity, including but not limited to carrying on the acquisition,
ownership, operation and disposition of oceangoing
vessels.  Notwithstanding its authority to do so as sole member
of  the Company, the Vendor has not appointed or elected any
individuals to officer positions of  the Company.

       

      
        	
                4  

              	
                Financial
      Arrangements

              


      

       

      
        	
                (a)  

              	
                Indebtedness

              


      

       

      Save as
Disclosed, the Company do not have outstanding nor has it incurred or agreed to
incur any Indebtedness (including, without limitation, any indebtedness for
moneys borrowed or raised under any acceptance credit, bond, rate, bill of
exchange or commercial paper, finance lease, hire purchase agreement, trade
bills, forward sale or purchase agreement or conditional sale agreement or other
transaction having the commercial effect of a borrowing).

       

      
        	
                (b)  

              	
                Financing
      Arrangements, Collateral Transfer
Arrangements

              


      

       

      The sale
by the Vendor and the purchase of the Purchaser of the Interests are subject to
the Financing Arrangements and further to the completion of the Collateral
Transfer Arrangements.  These arrangements are reflected in the
Finance Documents.

       

      
        	
                (c)  

              	
                Loans
      by the Company

              


      

       

      The
Company has not made any loans to the Vendor, any Vendor Group Companies or any
third party.

       

      
        	
                (d)  

              	
                Debts

              


      

       

      The
Company has not factored any of its debts. There are no debts owing to the
Company.

       

      
        	
                (e)  

              	
                No
      guarantee or Security Interests

              


      

       

      No
guarantee or Security Interest has been given or entered into by the Company or
any third party in respect of Indebtedness or other obligations of the Company
and no guarantee or Security Interest has been given or entered into by the
Company in respect of any other person.

       

      
        	
                (f)  

              	
                No
      indemnities given by the Company

              


      

       

      
        
          
          

        

        
          32

          
            

          

        

        
          
          

        

      

      The
Company is not responsible (including on a contingent basis) for the
indebtedness, or for the default in the performance of any obligation, of any
person nor are they party to any option or pre-emption right or any guarantee,
suretyship or any other obligation (whatever called) to pay, purchase or provide
funds (whether by advance of money, the purchase of or subscription for shares
or other securities or the purchase of assets or services or otherwise) for the
payment of, or as an indemnity against the consequence of default in the payment
of, any indebtedness of any person.

       

      
        	
                (g)  

              	
                Bank
      accounts

              


      

       

      Details
of all bank accounts of the Company, and particulars of the balances of all the
Company’s bank accounts as at a date not more than 2 (two) Business Days before
the date of this Agreement, have been disclosed to the Purchaser, and the
Company has no other bank accounts. Since the date of such particulars, there
have been no material payments out of any such bank accounts, except for routine
payments in the ordinary course of business consistent with past
practices.

       

      
        	
                5  

              	
                Assets,
      Liabilities and other Arrangements

              


      

       

      
        	
                (a)  

              	
                No
      other assets and liabilities

              


      

       

      The
Company has no assets other than the Vessel and the Company has no liabilities
other than those arising in connection with the Transaction Documents and as set
forth in the Disclosure Schedule and, save for its obligations under the
Transaction Documents, there are no agreements or arrangements to which the
Company is a party that increase the obligations of the Company under the
Transaction Documents or that create or include any other obligation that might
be binding on the Company.

       

      
        	
                (b)  

              	
                Business
      activity

              


      

       

      The only
business activity of the Company since incorporation or formation has been the
acquisition, ownership, and operation of the Vessel.

       

      
        	
                6  

              	
                Properties

              


      

       

      The
Company does not own, occupy or use any real property.

       

      
        	
                7  

              	
                Insurance

              


      

       

      The
Company maintains the policies of insurance listed in the Disclosure Schedule
and attached to the Disclosure Schedule, each of which is in full force and
effect and, to the Vendor's knowledge, not subject to being avoided for any
reason.

       

      
        	
                8  

              	
                Litigation
      and other Disputes

              


      

       

      
        	
                (a)  

              	
                No
      proceedings

              


      

       

      The
Company is not, and, to the Vendor's knowledge, no director or officer of the
Company (in relation to the Company’s affairs or, if resolved in a manner
adverse to such director or officer, could result in a materially adverse effect
on the Company’s business) is, engaged in or a party to any dispute, litigation,
arbitration, prosecution or other legal proceedings or in any proceedings or
hearings before any statutory or governmental body, department, board or agency,
nor are any of the foregoing pending or, to the Vendor's knowledge, threatened
or expected either against or by the Company, and, to the Vendor's knowledge,
there is no fact or circumstance or any other form of written demand in
existence that might give rise to the same, or form the basis of any criminal
prosecution against the Company.

       

      
        
          
          

        

        
          33

          
            

          

        

        
          
          

        

      

      
        	
                (b)  

              	
                No
      orders or judgements

              


      

       

      There is
no order, decree or judgement of any court, tribunal or any governmental agency
of any country outstanding against the Company or, to the Vendor's knowledge,
any person for whose acts the Company may be vicariously liable, and, to the
Vendor's knowledge, there are no circumstances likely to give rise to vicarious
liability of the Company, and no injunction has been granted against the
Company.

       

      
        	
                (c)  

              	
                No
      unlawful acts

              


      

       

      The
Company has not committed, or been prosecuted for, any breach of a statutory or
regulatory duty or any tortious or other criminal or unlawful or unauthorised
act that could reasonably be expected to lead, or has led, to a claim for
damages or an injunction or other order of a court or tribunal of competent
jurisdiction being made against it, and there are no circumstances likely to
give rise to such a breach or act.

       

      
        	
                9  

              	
                Compliance
      with Legal Requirements

              


      

       

      
        	
                (a)  

              	
                Compliance
      by Company

              


      

       

      The
Company has, so far as the Vendor is aware, complied and are continuing to
comply in all material respects with all relevant legislation and regulations
and guidelines in any part of the world applicable to them and/or their business
and/or their assets.

       

      
        	
                (b)  

              	
                Ultra
      vires

              


      

       

      The
Company are empowered and duly qualified to carry on business in all
jurisdictions in which its present business is now carried on and has not
entered into any ultra vires transaction.

       

      
        	
                (c)  

              	
                Returns

              


      

       

      All
returns, particulars, resolutions and other documents required to be filed with
or delivered to the Registrar of Corporations in the Republic of the Marshall
Islands by the Company has been properly prepared and so filed or
delivered.

       

      
        	
                (d)  

              	
                Limited
      Liability Company Agreement

              


      

       

      The
Limited Liability Company Agreement of, and all resolutions passed by, the
Company and all other legal requirements concerning the Company have been
complied with. A copy of the Company’s Limited Liability Company Agreement has
been provided to the Purchaser, which is complete and accurate in all material
respects, has attached thereto or incorporated therein copies of all resolutions
and other documents required by law to be so attached or incorporated, and fully
sets out the rights and restrictions attaching to the Interests.

       

      
        
          
          

        

        
          34

          
            

          

        

        
          
          

        

      

      
        	
                (e)  

              	
                Books
      and records

              


      

       

      The
statutory books (including all registers and minute books whether electronic or
otherwise), books of account and other statutory records of the Company have
been properly and accurately written up or maintained in accordance with all
applicable laws and are up to date (but not including the date of the Agreement)
and comprise complete and accurate records of all information required to record
therein other than to the extent that they are not material to the business of
the Company. The Company has not received any notice or allegation that any of
the statutory books, books of accounts or other records of whatsoever kind of
the Company are inaccurate or incomplete or should be rectified.

       

      
        	
                (f)  

              	
                Company’s
      name

              


      

       

      The
Company does not use or otherwise carry on business under any name other than
its full corporate name.  The Company has the full right to use its
corporate name without restriction, and the Company and the Vendor are not aware
of any actual or threatened challenge to the use of those names or any of them
in respect of the business of the Company or any claim that any such use
infringes any rights of any third party.

       

      
        	
                (g)  

              	
                Consents
      and licences

              


      

       

      The
Company holds any and all licences (including statutory licences), permissions,
authorisations, consents, registrations and exemptions required by the Company
for the operation of its business as now carried on, and, to the Vendor's
knowledge, none of these is subject to revocation or cancellation for any
reason.

       

      
        	
                (h)  

              	
                No
      penalties or fines

              


      

       

      The
Company nor any of its officers (or agents during the course of their duties)
have committed or omitted to do any act or thing that has given or could give
rise to a material claim, fine, penalty or other liability, at law or in equity,
in respect of the physical or environmental condition of any of their fixed or
moveable assets, real property or products.

       

      No
investigations and inquiries. No investigations, inquiries or reviews by or on
behalf of any governmental or other body in respect of the Company or its
business or assets are pending or, to the Vendor's knowledge, in existence or
have been conducted or threatened, and there are no circumstances that might
give rise to such investigation, inquiry or review.

       

      
        	
                10  

              	
                Employment

              


      

       

      The
Company does not, and has never had any employees and there are no arrangements
(written or otherwise) under which remuneration or benefit or other sum
whatsoever is paid or given to any person (including any officer or consultant
of the Company).

       

      
        	
                11  

              	
                Taxation

              


      

       

      
        	
                (a)  

              	
                Tax
      Residence.

              


      

       

      
        	
                    
      (i)  

              	
                The
      Company was and had always been resident in
      The Marshall Islands for the purposes of Taxation until August
      1, 2007, at which time it became resident in The Bahamas for the purposes
      of Taxation until February 29, 2008, at which time it became resident in
      Bermuda for the purposes of Taxation, and the Company has never been
      resident in any other country for the purposes of Taxation or treated as
      so resident for the purposes of any double taxation
    agreement.

              


      

       

      
        
          
          

        

        
          35

          
            

          

        

        
          
          

        

      

      
        	
                     
      (ii)  

              	
                The
      Company has never traded through a branch, agency or permanent
      establishment situated outside The Marshall Islands, The
      Bahamas or Bermuda.

              


      

       

      
        	
                      
      (iii)  

              	
                No
      circumstances exist whereby a person not resident in The Marshall
      Islands, The Bahamas or Bermuda is assessable and chargeable to tax
      in the name of the Company.

              


      

       

      
        	
                (b)  

              	
                Disclosures,
      Notices, Returns, Clearances and
Records.

              


      

       

      
        	
                    
      (i)  

              	
                All
      notices, reports, disclosures, accounts, computations, statements,
      assessments, registrations, de-registrations and any other information
      that ought to have been made or supplied by or in respect of the Company
      for any Taxation purposes have been made or supplied on a proper basis,
      were punctually submitted, were accurate and complete when submitted and
      remain accurate and complete and are not the subject of any dispute,
      enquiry or investigation with any Taxation Authority, and, to the Vendor's
      knowledge, there are no present circumstances that are likely to give rise
      to any such dispute, enquiry or
investigation.

              


      

       

      
        	
                     
      (ii)  

              	
                No
      action has been taken by the Company in respect of which any consent or
      clearance from any Taxation Authority was required except in circumstances
      where such consent or clearance was validly obtained, and no conditions
      were attaching thereto.

              


      

       

      
        	
                      
      (iii)  

              	
                The
      Company has made and submitted each claim, disclaimer, election, notice
      and consent to have been made and submitted, and details of all such
      claims, disclaimers, elections, notices and consents are set forth in the
      Disclosure Schedule.

              


      

       

      
        	
                      
      (iv)  

              	
                The
      Company has never been subject to any enquiry, visit, audit, investigation
      or discovery order by any Taxation Authority nor, to the Vendor's
      knowledge, are there any circumstances existing that make it likely that
      any such enquiry, visit, audit, investigation or discovery order will be
      made in the next 12 months.

              


      

       

      
        	
                     
      (v)  

              	
                The
      Disclosure Schedule sets out details of all notices given by any Taxation
      Authority to or in relation to the Company, the provisions of which remain
      in force.

              


      

       

      
        	
                      
      (vi)  

              	
                The
      Company has sufficient records relating to past events to permit accurate
      calculation of the Taxation liability or relief that would arise upon a
      disposal or realisation on completion of each asset owned by the Company
      before Closing.

              


      

       

      
        	
                       
      (vii)  

              	
                Except
      as set out in the Disclosure Schedule, the Company’s Taxation affairs are
      not dependent on or subject to any concession, agreement or other formal
      or informal arrangement with any Taxation
  Authority.

              


      

       

      
        	
                (c)  

              	
                All
      Tax Paid

              


      

       

      
        	
                    
      (i)  

              	
                All
      Taxation for which the Company is liable and that ought to have been paid
      has been paid on a timely basis to the appropriate Taxation
      Authority.

              


      

       

      
        
          
          

        

        
          36

          
            

          

        

        
          
          

        

      

      
        	
                     
      (ii)  

              	
                The
      Company has not paid, within the three years ending on the date of this
      Agreement, nor will become liable to pay, any interest, penalty, fine or
      surcharge to any Taxation
Authority.

              


      

       

      
        	
                      
      (iii)  

              	
                The
      Company has not received from any Taxation Authority (and have not
      subsequently repaid to or settled with that Taxation Authority) any
      payment to which they were not entitled or any notice in which their
      liability to Taxation was
understated.

              


      

       

      
        	
                (d)  

              	
                Stamp
      Duty

              


      

       

      All
documents that are in the possession of the Company or under its control or to
which the Company is a party and that attract stamp duty have been properly
stamped, and the Company has duly paid all stamp duty to which they are, have
been or may be made liable, and there is no liability for any penalty in respect
of such duty nor, to the Vendor's knowledge, are there any circumstances or
transactions to which the Company is or have been a party, which may result in
the Company becoming liable for any such penalty.

       

      
        	
                (e)  

              	
                U.S.
      Tax Classification

              


      

       

      The
Company is classified for United States federal income tax purposes as a
disregarded entity pursuant to Treas. Reg. Section
301.7701-3.  Neither the Vendor nor the Company will take any action
to change the U.S. federal income tax classification of the
Company.

       

      
        	
                12  

              	
                Miscellaneous

              


      

       

      
        	
                (a)  

              	
                No
      broker’s fees

              


      

       

      No one is
entitled to receive from the Company any finder’s fee, brokerage, or other
commission in connection with the purchase of the Interests.

       

      
        	
                (b)  

              	
                Effect
      of entering into this Agreement

              


      

       

      Compliance
with the terms of this Agreement or Closing does not and will not:

       

      
        	
                    
      (i)  

              	
                conflict
      with or result in the breach of or constitute a default under any of the
      terms, conditions or provisions of:

              


      

       

      
        	
                                                (A)  

              	
                any
      agreement or instrument to which the Company is now a party, including the
      Transaction Documents; or

              


      

       

      
        	
                                              
      (B)  

              	
                The
      Company’s Limited Liability Agreement or give rise to or cause to become
      exercisable any right of pre-emption or right of first refusal;
      or

              


      

       

      
        	
                                              
      (C)  

              	
                any
      loan to or mortgage created by the Company or any lien, lease, order,
      judgment, award, injunction, decree, ordinance or regulation or any other
      restriction of any kind or character to which any property of the Company
      are subject or by which the Company is
bound;

              


      

       

      
        	
                     
      (ii)  

              	
                result
      in any present or future Indebtedness becoming due or capable of becoming
      due and payable prior to its stated
maturity;

              


      

       

      
        
          
          

        

        
          37

          
            

          

        

        
          
          

        

      

      
        	
                      
      (iii)  

              	
                relieve
      any other party to an agreement or arrangement with the Company, including
      the Transaction Documents, of its obligations thereunder (whether
      contractual or otherwise) or enable it to vary or terminate its rights or
      obligations thereunder or determine any right or benefit enjoyed by the
      Company or to exercise any right, whether under an agreement with, or
      otherwise in respect of, the
Company;

              


      

       

      
        	
                      
      (iv)  

              	
                result
      in the creation or imposition of any Security Interest on any assets of
      the Company;

              


      

       

      
        	
                     
      (v)  

              	
                cause
      the Company to lose the benefit of any right or privilege it presently
      enjoys;

              


      

       

      
        	
                       (vi)  

              	
                cause
      any person who normally does business with the Company not to continue to
      do so on the same basis as previously;
or

              


      

       

      
        	
                       
      (vii)  

              	
                cause
      any licence or authority necessary or desirable for the continuation of
      the Company’s respective business to be determined or not renewed or
      continued or renewed on less favourable
terms.

              


      

       

      
        	
                (c)  

              	
                Accurate
      information provided

              


      

       

      All
information given by the Vendor or any Vendor Group Companies or officials or
professional advisers of the Company or the Vendor to any of the directors,
officials or professional advisers of the Purchaser in the course of
negotiations leading to this Agreement, taken as a whole, was, when given, and
remains and will at Closing be true and accurate in all material respects, and
there is no matter or fact that has not been disclosed to the Purchaser that
renders any such information untrue or misleading in any material
respect.

       

      
        	
                (d)  

              	
                Disclosure
      Schedule etc accurate

              


      

       

      All
information contained in the Disclosure Schedule is true, complete and accurate
in all respects and nothing has been omitted and, there is no matter or fact,
which renders any such information untrue, inaccurate, incomplete or misleading
in any material respect.

       

      
        	
                (e)  

              	
                All
      information disclosed

              


      

       

      All
information relating to the Company that the Vendor knows or should reasonably
know and that is material to be known by the Purchaser in the context of the
sale of the Interests has been disclosed to the Purchaser and, to the best of
the knowledge, information and belief of the Vendor, there are no other facts or
matters undisclosed to the Purchaser that could reasonably be expected to have a
material adverse effect on the Company or the Interests.

       

      
        	
                13  

              	
                Insolvency

              


      

       

      
        	
                (a)  

              	
                No
      Insolvency event

              


      

       

      No
Insolvency Event has occurred in relation to the Company and no events or
circumstances have arisen that entitle or could entitle any person to take any
action, appoint any person, commence proceedings or obtain any order instigating
an Insolvency Event.

       

      
        	
                14  

              	
                The
      Vessel

              


      

       

      
        	
                (a)  

              	
                Vessel
      Commitments

              


      

       

      
        
          
          

        

        
          38

          
            

          

        

        
          
          

        

      

      In
relation to the Vessel:

       

      
        	
                     (i)  

              	
                the
      Vessel is properly registered in the name of the Company under and
      pursuant to the flag and law of the Bahamas and all fees due and payable
      in connection with such registration have been
  paid;

              


      

       

      
        	
                     
      (ii)  

              	
                the
      Vessel is entered with Det Norske Veritas (or another classification
      society of like standing) and has the highest classification rating issued
      by such society for a vessel of the type, age and class of the
      Vessel;

              


      

       

      
        	
                      
      (iii)  

              	
                the
      Vessel is in class without any recommendations or notation as to class or
      other requirement of the relevant classification society, and if the
      Vessel is in a port, it is in such condition that it can not be detached
      by any port state authority or the flag state authority for any
      deficiency;

              


      

       

      
        	
                      
      (iv)  

              	
                the
      Vessel is owned free of all maritime liens, encumbrances and mortgages
      except those that have been Disclosed in the Disclosure Schedule and
      accepted by the Purchaser and the terms of any charters that continue
      beyond the Closing Date, mortgages and loan documents do not prohibit the
      sale of the Company;

              


      

       

      
        	
                     
      (v)  

              	
                the
      Vessel has been maintained in a proper and efficient manner in accordance
      with internationally accepted standards for good ship maintenance, is in
      good operating order, condition and repair and is seaworthy and all
      repairs made to the Vessel during the last two years and all known
      scheduled repairs due to be made and all know deficiencies have been
      Disclosed in the Disclosure
Schedule;

              


      

       

      
        	
                      
      (vi)  

              	
                the
      Vessel is not:

              


      

       

      
        	
                                               
      (A)  

              	
                under
      arrest or otherwise detained;

              


      

       

      
        	
                                              
      (B)  

              	
                 other
      than in the ordinary course of business, in the possession of any person
      (other than her master and crew) or subject to a possessory lien;
      or

              


      

       

      
        	
                                               (C)  

              	
                other
      than in the ordinary course of business, subject to any other
      lien;

              


      

       

      
        	
                       
      (vii)  

              	
                the
      Vessel complies in all material respects with all laws, the requirements
      of any government agency having jurisdiction over the Vessel, the
      provisions of all international conventions and the provisions of the
      rules and regulations issued under international conventions applicable to
      that Vessel;

              


      

       

      
        	
                        
      (viii)  

              	
                the
      Vessel is supplied with valid and up-to-date safety, safety construction,
      safety equipment, radio, loadline, health, tonnage, trading and other
      certificates or documents as may for the time being be prescribed by the
      law of the flag of the Vessel or of any other pertinent jurisdiction, or
      that would otherwise be deemed necessary by a shipowner acting in
      accordance with internationally accepted standards for good ship
      management and operations;

              


      

       

      
        	
                     
      (ix)  

              	
                no
      blacklisting or boycotting of any description whatsoever has been applied
      or currently exists against or in respect of the Vessel;
    and

              


      

       

      
        	
                    
      (x)  

              	
                the
      Vessel has been delivered by the Company to and accepted on an
      unconditional basis by the Charterer for service under and in accordance
      with the terms and conditions of the
Charter.

              


      


      
        
           


        

        
          39

          
            

          

        

        
           


          
            


                                                                                                                                       Schedule
4 : The Vessel 

          

        

      


      


       

      Schedule
4

      The
Vessel

       

      
        	
                Vessel

              	
                “NARMADA
      SPIRIT”

              
	
                Built

              	
                2003

              
	
                Yard

              	
                Ulsan,
      Korea

              
	
                Class

              	
                DNV

              
	
                Flag

              	
                Bahamas

              
	
                Place
      of Registration

              	
                Nassau

              
	
                Call
      sign

              	
                C6WG5

              
	
                IMO
      (Registration) No.

              	
                9269075

              
	
                Grt/Nrt

              	
                81074/52045

              


      


      
        
           


        

        
          40

          
            

          

        

        
           


          
            


                                                                                                                                       Schedule
5 : The Consideration Formula 

          

        

      


      


       

      Schedule
5

      The
Consideration Formula

       

      
        	
                Fair
      Market Value of Vessel:

              	
                $96,500,000

              
	
                Plus
      Fair Market Value of Charter:

              	
                Nil

              
	
                Less
      Company’s debt outstanding under Facility Agreement on Closing Date (April
      7, 2008)

              	
                $37,307,018

              
	
                Equals
      Consideration:

              	
                $59,192,982

              


      

       

      


       

      



      
        
           


        

        
          41

          
            

          

        

        
           


        

      


      


       

      EXECUTION
PAGE

       

      


      
        	
                Executed
      by

                TEEKAY SHIPPING
      CORPORATION 

                acting
      by

              	
                )

                )

                )

              	 
      
	 
      	 
      	 
      
	 
      	 
      	 
      


      

      


      


      


      


      
        	
                Executed
      by

                TEEKAY TANKERS LTD.
      

                acting
      by

              	
                )

                )

                )

              	 
      
	 
      	 
      	 
      
	 
      	 
      	 
      


      

      


       

      


      
        
          
          

        

        
          42