ISIN
      NO
      001 0345374

















**LOAN
      AGREEMENT**





between





**B+H
      Ocean Carriers Ltd**


(Borrower)





and





**Norsk
      Tillitsmann ASA**


(Loan
      Trustee)





on
      behalf
      of





**the
      Bondholders**





in
      the
      bond issue





FRN
      B+H
      Ocean Carriers Ltd Open Bond Issue 2006/2013









































**TABLE
      OF CONTENTS**








1  Definitions


2  The
      Loan


3  Listing


4  Registration
      in a Securities Depository


5  The
      functions, duties and liability of the Loan Trustee


6  Conditions
      Precedent


7  Representations
      and Warranties


8  Status
      of
      the Loan


9  Interest


10  Maturity
      of the Loan and Call Option


11  Interest
      in the event of late payment


12  Borrower's
      acquisition of Borrower’s Bonds


13  Covenants


14  Fees
      and
      expenses


15  Events
      of
      Default


16  Authority
      of the Bondholders' meeting and the Loan Trustee


17  Procedural
      rules


18  Repeated
      Bondholders' meeting


19  Change
      of
      Loan Trustee


20  Limitation


21  Dispute
      resolution and legal venue





















































This
      agreement (the "Loan Agreement") has been entered into on December 11, 2006
      between **B+H
      Ocean Carriers Ltd** (Company
      No C51934) as borrower (the “Borrower”) and **Norsk Tillitsmann
      ASA** (Company
      No 963 342 624) as loan trustee (the “Loan Trustee”).





Through
      their subscription in the Loan the Bondholders have acceded to the Loan
      Agreement (i.e.):





*  The
      Bondholders are bound by the terms of the Loan Agreement provided that
      information about the accession was given in the subscription
      documents.




*  The
      Loan
      Trustee has through the Bondholders subscription been granted authority to
      act
      on behalf of the Bondholders to the extent provided for in the Loan
      Agreement.





The
      Loan
      Agreement is available to anyone and may be obtained from the Loan Trustee
      or
      the Borrower. The Borrower shall ensure that the Loan Agreement is available
      to
      the general public throughout the entire term of the Loan.










**1**  **Definitions**




Whenever
      used in this Loan Agreement the following terms shall have the following
      meaning:





Banking
      Day:  any
      day
      on which commercial banks are open for general business (including dealings
      in
      foreign exchange and foreign currency deposits) in Oslo, London and New
      York .





Bondholders:   the
      holders of the Bonds.





Bonds:   bonds
      in
      the Loan, as described in Clause 2.1, each individually a “Bond”.





Borrower’s
      Bonds:   Bonds
      in
      the Remaining Loan, owned by the Borrower or any
      party
      over whom the Borrower has decisive influence or any party who has decisive
      influence over the Borrower. **





Change
      of
      Control Event:  means
      that a shareholder or a group of affiliated shareholders, or companies, (direct
      or indirect), ref Securities Trading Act § 1-4, exclusive of Michael S. Hudner
      and Trevor J. Williams and companies under control of Michael S. Hudner and
      Trevor J. Williams, obtain (including purchase, merger, dilution etc.) ownership
      or control of more than 50 - fifty - per cent of the share capital of the
      Borrower.





Disbursement
      Date:    12
      December 2006.





Event
      of
      Default:   means
      each event defined as an event of default in Clause
      15.1.





Exchange:   securities
      exchange or other reputable market place for securities having satisfactory
      requirements as to listing and trading, where the Loan is listed or applied
      for
      listing.





Finance
      Documents:   means
      (i)
      this Loan Agreement, (ii) the fee agreement according to Clause 14.1, and (iiii) any
      other
      document which is executed at any time by the Borrower in relation to any amount
      payable under this Loan Agreement or any of the other documents referred to
      in
      this definition .





Group:   the
      Borrower and its subsidiaries (if any).





Interest
      Determination Date:  8
      December 2006 and
      thereafter two Banking Days prior to each Interest Payment Date.





Interest
      Payment Date:  12
      March,
      12 June, 12 September and 12 December each
      year. If the Interest Payment Date is not a Banking Day, the Interest Payment
      Date shall be postponed to the next Banking Day. However, if this day falls
      in
      the following calendar month, the Interest Payment Date is moved to the first
      Banking Day preceding the original date.





Margin:   4.00
      percentage points.





Maturity
      Date:   12
      December 2013. If the
      Maturity Date is not a Banking Day, the Maturity Date shall be postponed to
      the
      next Banking Day. However, if this day falls in the following calendar month,
      the Maturity Date is moved to the first Banking Day preceding the original
      date.





Net
                Asset Value:
            
            Value
                Adjusted Assets less Net Debt on a consolidated basis and according
                to
                IFRS.





Net
                Debt:
            
            book
                value of all liabilities minus cash





LIBOR:  -  the
      interest rate rounded off to five decimal places for a 3 - three - months period
      that is quoted on Reuters Screen LIBOR01 page as of 11.00 a.m. London time
      on
      the Interest Determination Date.





Should
      the contents of the Reuters Screen LIBOR01 page be changed such that, in the
      opinion of the Loan Trustee, the interest rates shown no longer represent the
      same kind of interest rates as when the Loan was disbursed, or the relevant
      page
      is removed from the Reuters Screen, another news page shall be used. This page
      may be another Reuters Screen’s page or, possibly, that of another electronic
      news agency, if it, in the opinion of the Loan Trustee, specifies the same
      kind
      of interest rates as Reuters Screen LIBOR01 page did on the disbursement of
      the
      loan. Any disagreement of opinion between the Borrower and the Loan Trustee
      concerning the use of a new page must be treated as described in
      sub-clause 9.3 of the Loan Agreement.





LIBOR
      -


Reference
      Banks:  -  interest
      rate determined on the basis of the interest on deposits in U.S. Dollars in
      the
      inter-bank market in London, quoted by four large authorised exchange banks
      in
      the London market at approximately 11.00 a.m. London time on the Interest
      Determination Date in London, for a 3 - three - months period, starting on
      the
      Interest Payment Date and applicable to a comparable amount. The Loan Trustee
      will ask the head office of each of the banks for a quotation on such interest.
      If two or more quotations are given, the interest rate will be set at the
      arithmetic mean of the quotations. If less than two quotations are given, the
      interest rate will be set to the arithmetic mean of the rates that banks
      selected by the Loan Trustee quote at approximately 11.00 a.m. London time
      on
      the Interest Determination Date for deposits in U.S. Dollars to leading European
      banks for a 3 - three - months period starting on the Interest Payment Date
      and
      applicable to a comparable amount. An interest rate determined by calculation
      of
      the arithmetic mean shall be rounded off to five decimal places.





Outstanding
      Loan:   Remaining
      Loan less Borrower’s Bonds.





Payment
      Date:   in
      relation to the Loan the dates specified for payment of interest or principal.
      If Payment Date is not a Banking Day payments should be made the following
      Banking Day.





Put
      Option:   each
      Bondholder’s right to demand an early redemption of its Bonds as set out in
      Clause 10.2.





Remaining
      Loan:   the
      aggregate principal amount of all Bonds outstanding in the Loan less the
      principal amount of the Bonds redeemed by the Borrower and discharged through
      the Securities Depository.





Securities
      Depository:  the
      securities depository in which the Loan is registered. On Disbursement Date
      the
      Securities Depository is Verdipapirregisteret (“VPS”).





Securities
      Depository act:  the
      Norwegian act of 2002 no. 64 regarding securities depository.





Value
      Adjusted


Equity
      Ratio:   the
      ratio
      of Net Asset Value *to* Value
      Adjusted Assets, based on minimum two independent shipbrokers
      valuation.





Value
      Adjusted Assets:  on
      a
      consolidated basis, the sum of the book value of the Borrower’s assets (total
      book value of assets) in accordance with IFRS, adjusted for actual market value
      for all vessels based on independent shipbroker valuations. Cash shall not
      be
      included. For vessels under construction, shipbroker valuations minus remaining
      yard installments shall be used in the calculation.




**2**  **The
      Loan**




2.1  The
      Borrower has resolved to issue a series of Bonds at a maximum amount of
      USD 60,000,000 (US Dollars sixtymillion), herein referred to as the “Loan".
      The Loan may comprise of one or more tranches issued on different issue dates.
      The first tranche will be in the amount of USD 25,000,000 (US Dollar
      twentyfivemillion).





The
      Loan
      is an open (tap) issue, from and including Disbursement Date and will be closed
      no later than 5 Banking Days prior to Maturity Date.





The
      Bonds
      will be in denominations of USD 100,000 each and rank pari passu.





The
      Loan
      will be described as “FRN
      B+H
      Ocean Carriers Ltd Open Bond Issue 2006/2013”.





The
      registration number (ISIN) of the Loan will be NO 0010345374.





The
      tenor
      of the Loan is from and including the Disbursement Date to the Maturity
      Date.





The
      net
      proceeds of the Loan will be employed for the general corporate purpose,
      including but not limited to the following: (i) product tanker conversion
      project (six vessels), (ii) conversion of “Redina” (tbr “Sachem”) and “Sagamore”
to full D/H, (iii) acquisition of additional OBOs, (iv) acquisition of further
      product tankers, (v) continuance of share buy-back, and (vi) balance of equity
      payment on “Sakonnet” (ex-“Sibohelle”).





2.2  All
      tranches under the Loan will be subject to identical terms in all respects.
      The
      rights and obligations of all parties to the Loan will also apply for later
      tranches issued within the maximum amount of the Loan.




The
      Loan
      Trustee will when issuing additional tranches prepare an addendum to the Loan
      Agreement regulating the conditions precedent to disbursement of the relevant
      tranche.







**3**  **Listing**




3.1  The
      Loan
      will initially not be applied for listing. An application may later be made
      for
      the bonds to be listed on Oslo Børs or Oslo Børs’ Alternative Bond Market (ABM)
      at the Borrower’s discretion.







**4**  **Registration
      in a Securities Depository**




4.1  The
      Loan
      must prior to disbursement be registered in a Securities Depository according
      to
      the Securities Depository act and the conditions from the Securities Depository.





4.2  The
      Borrower shall promptly arrange for notification to the Securities Depository
      of
      any changes in the terms and conditions of the Loan. The Loan Trustee shall
      have
      a copy of the notification.





4.3  The
      Borrower is responsible for the implementation of correct registration in the
      Securities Depository. The registration may be executed by an agent for the
      Borrower provided that the agent is qualified according to relevant regulations.







**5**  **The
      functions, duties and liability of the Loan Trustee**




5.1  The
      Loan
      Trustee shall pursuant to this Loan Agreement and in compliance with laws and
      regulations monitor the Bondholders' interests and rights vis-à-vis the
      Borrower, inter alia,





-  monitor
      the Borrower’s fulfilment of his obligations under the Loan
      Agreement,


-  exercise
      necessary discretion in carrying out the duties assigned to the Loan Trustee
      under the Loan Agreement,


-  ensure
      that valid decisions made at Bondholder meetings are carried out,


-  make
      the
      decisions and implement the measures that are assigned to or imposed on the
      Loan
      Trustee pursuant to this Loan Agreement,


-  forward
      to the Bondholders necessary information which is obtained and received in
      its
      capacity as Bondholder’s representative,


-  verify
      the timely and correct payment of interest and principal, and


-  provided
      the Loan is listed, inform the Exchange of circumstances which are of importance
      to the listing and quotation of the Loan; however, this only applies to cases
      in
      which the Loan Trustee gains knowledge of or should have knowledge of such
      circumstances and the Borrower fails to fulfil its duty of information towards
      the Exchange after having been urged to do so by the Loan Trustee.





5.2  In
      performing its functions as Bondholder’s representative, the Loan Trustee is not
      obligated to assess the Borrower's financial situation or ability to service
      the
      Loan except to the extent such duty may clearly be inferred from the Loan
      Agreement.





5.3  The
      Loan
      Trustee shall be liable to pay damages for financial losses suffered by the
      Bondholders as a result of negligence of the Loan Trustee in performing its
      functions and duties under the Loan Agreement. The Loan Trustee is not
      responsible for the content of the information the Loan Trustee has submitted
      on
      behalf of the Borrower.










**6**  **Conditions
      Precedent**




6.1  Disbursement
      of the Loan will be subject to the Loan Trustee having received the following
      documents, in form and substance satisfactory to it, at least two Banking Days
      prior to the Disbursement Date:




|(a) | the
              Loan Agreement duly executed,
|--- | -----------------------------------------------




|(b) | certified
              copies of all necessary corporate resolutions to issue the Bonds and
              execute the Finance Documents,
|--- | -----------------------------------------------------------------------------------------------------------------------------------------




|(c) | a
              power of attorney from the Borrower to relevant individuals for their
              execution of the relevant Finance
              Documents,
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------




|(d) | certified
              copies of the Certificate of Incorporation and Articles of Association
              of
              the Borrower, and extracts from the relevant registrar or similar
              documentation evidencing the individuals authorised to sign on behalf
              of
              the Borrower,
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




|(e) | the
              latest available annual and interim report (if applicable) of the Borrower
              and the Group,
|--- | -------------------------------------------------------------------------------------------------------------------------




|(f) | to
              the extent necessary, certified copies of authorisations required for
              the
              validity of and execution, delivery and performance by and the
              enforceability against the Borrower of the Loan Agreement, i.a. -
              confirmation that the subscription documents have been controlled by
              the
              Exchange, or confirmation from the manager of the Loan that the
              subscription documents have been controlled and that a prospectus is
              not
              required according to Norwegian law and any other applicable
              law,
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




|(g) | confirmation
              that the Loan has been registered in a Securities Depository,
|--- | ----------------------------------------------------------------------------------------




|(h) | written
              confirmation from the Borrower in accordance with Clause 7.1,
|--- | -----------------------------------------------------------------------------------




|(i) | the
              agreement set forth in Clause 14.1, duly executed,
              and
|--- | --------------------------------------------------------------------------------------




|(j) | any
              written documentation made public in connection with the
              Loan.
|--- | ----------------------------------------------------------------------------------------------







6.2  Subject
      to the conditions set out above the first tranche of the Loan will be made
      available to the Borrower at Disbursement Date.





6.3  The
      Loan
      Trustee is entitled to accept a delay in receiving documents listed
      above.










**7**  **Representations
      and Warranties**




7.1  The
      Borrower shall in writing represent and warrant that:





|(a) | the
              Borrower is a public limited liability company, duly incorporated and
              validly existing under the law in which it is registered, and has the
              power to own its assets and carry on its business as presently
              conducted;
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




|(b) | the
              Borrower has the power to enter into and perform, and has taken all
              necessary corporate action to authorise the entry into, performance
              and
              delivery of the Finance Documents;
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




|(c) | the****Finance
              Documents constitute (or will constitute, when executed by the respective
              parties thereto) legal, valid and binding obligations of such parties,
              enforceable in accordance with its terms, and (save as provided for
              therein) no registration, filing, payment of tax or fees or other
              formalities are necessary or desirable to render the said documents
              enforceable against the Borrower;
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




|(d) | the
              entry into and performance by the Borrower of the Finance Documents
              and
              the transactions contemplated thereby do not and will not conflict
              with
              (i) any present law or regulation or judicial or official order; (ii)
              its
              articles of association, by-laws or other constitutional documents;
              or
              (iii) any document or agreement which
              is binding on the Borrower;
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




|(e) | no
              Event of Default exists; and no other circumstances exist which constitute
              or (with the giving of notice, lapse of time, determination of materiality
              or the fulfilment of any other applicable condition, or any combination
              of
              the foregoing) would constitute a default under any document which
              is
              binding on the Borrower or any of its assets, and which may have a
              material adverse effect on the ability of the Borrower to perform its
              obligations under the Finance Documents;
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




|(f) | all
              documents and information which has been provided in connection with
              this
              Loan, represent the latest available financial information concerning
              the
              Group and there has been no change in the Group’s financial position which
              could have a material adverse effect on the Borrower’s ability to perform
              its duties under the Finance Documents;
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




|(g) | all
              authorisations, consents, licenses or approvals of governmental
              authorities required for the Borrower in connection with the execution,
              performance validity or enforceability of the Finance Documents, and
              the
              transactions contemplated thereby, have been obtained and are
              valid;
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




|(h) | all
              authorisations, consents, licenses or approvals of governmental
              authorities required for the Borrower to carry on its business as
              presently conducted, have been obtained and are in full force and effect,
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




|(i) | no
              litigation, arbitration or administrative proceeding is pending or,
              to the
              best of the Borrower’s knowledge, threatened against it which would
              materially and adversely affect the affairs, assets or financial condition
              of the Borrower or its ability to perform its obligations under the
              Finance Documents;
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(j) | the
              Borrower is not required to make any deduction or withholding from
              any
              payment which it may become obliged to make to the Loan Trustee (on
              behalf
              of the Bondholders) under the Finance
              Documents;
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




|(k) | the
              Borrower's payment obligations under the Finance Documents rank at
              least
              pari passu with the claims of all its other unsecured and unsubordinated
              creditors, except for obligations mandatory preferred by law applying
              to
              companies generally; and
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




|(l) | the
              representations and warranties set out in this Clause 7.1, are made
              by the
              Borrower on the signing date of the Loan
              Agreement.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




7.2  The
      Borrower shall indemnify the Loan Trustee for any economic losses suffered
      as a
      result of complying with the representations and warranties provided by the
      Borrower herein both prior to disbursement of the Loan, and during its
      life.







**8**  **Status
      of the Loan**




8.1  The
      Loan
      shall rank *pari
      passu* with all
      other senior debt of the Borrower, save for obligations which are mandatory
      preferred by law and shall rank ahead of subordinated capital .




8.2  The
      Loan
      shall be unsecured.







**9**  **Interest** **and interest calculations**




|9.1 | Interest
              accrues from and including the Disbursement Date based on LIBOR plus
              Margin. The interest rate is set on the first Interest Determination
              Date.
              Should LIBOR not be available, the interest rate will be set based
              on
              LIBOR Reference Banks plus Margin.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




The
      interest rate is reset in accordance with sub-clause 9.2.





The
      interest is paid in arrears on each Interest Payment Date, the first Interest
      Payment Date falling in March 2007.





9.2  The
      interest rate on the Loan is reset with effect from each Interest Payment Date.
      The new interest rate is reset on the Interest Determination Date based on
      LIBOR
      plus Margin. Should LIBOR not be available, the interest rate will be reset
      based on LIBOR Reference Banks plus Margin.





When
      the
      interest is set for the first time and on subsequent interest rate resets,
      the
      next Interest Payment Date and the actual number of calendar days up to that
      date must be notified to the Bondholders in writing via the Securities
      Depository. This communication must also include the interest rate applicable
      up
      to the next Interest Payment Date. The Loan Trustee and, if the Loan is listed,
      the Exchange shall be notified of the new interest rate immediately.





9.3  In
      the
      event that the interest rate is fixed in accordance with quotes from LIBOR
      Reference Banks, the Borrower or Bondholders representing at least 1/10th of
      the
      Outstanding Loan may appeal against the interest rate fixing. Such an appeal
      must be presented in writing to the Loan Trustee within 20 Banking Days of
      the
      Bondholders being informed of the interest rate fixing. The appeal will be
      dealt
      with by a committee comprising three members, of which one representative is
      nominated by the Borrower, one representative is nominated by the Loan Trustee
      and a chairman agreed by the representatives of the two parties. If the parties
      cannot agree on a chairman, this person will be nominated by the Lord Chief
      Justice of the Oslo City Court. The decision of the committee is
      final.





Bondholders
      and the Exchange (if applicable) shall receive written notice from the
      Securities Depository that an appeal has been made against the procedure for
      fixing the interest rate in accordance with sub-clause 9.3.





9.4
            The
                interest is calculated on the basis of the actual number of elapsed
                calendar days from and including the Disbursement date to the following
                Interest Payment Date, and subsequently from each interest fixing
                date to
                the next or the maturity date. The number of days is divided by
                360.







**10**  **Maturity
      of the Loan** **,
      call option, put option and mandatory redemption**




10.1  The
      Loan
      will run without installments and mature in whole on the Maturity Date at
      par (100%).





10.2
      The
      Borrower may redeem the Loan or any portion of the Loan (the "Call Option")
      as
      follows:





|(i) | at
              any time (*American
              option*)
              from and included the Interest Payment Date in June 2010 to, but not
              included, the Interest Payment Date in June 2011 at 104.50 % of par
              value
              plus accrued unpaid interest on redeemed amount,
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




|(ii) | at
              any time (*American
              option*)
              from and included the Interest Payment Date in June 2011 to, but not
              included, the Interest Payment Date in June 2012 at 103.25 % of par
              value
              plus accrued unpaid interest on redeemed amount,
|---- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




|(iii) | at
              any time (*American
              option*)
              from and included the Interest Payment Date in June 2012 to, but not
              included, the Interest Payment Date in June 2013 at 102.25 % of par
              value
              plus accrued unpaid interest on redeemed amount,
              and
|----- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




|(iv) | at
              any time (*American
              option*)
              from and included the Interest Payment Date in June 2013 to, but not
              included, the Maturity Date at 101.00 % of par value plus accrued unpaid
              interest on redeemed amount.
|---- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




Should
      the Borrower exercise the Call Option, the Loan Trustee and the Bondholders
      must
      be informed of this (the Bondholders in writing via VPS) no later than 30 -
      thirty - Banking Days before the date of redemption. The Exchange (if
      applicable) shall immediately be informed.





Partial
      redemption of the Loan must be carried out by drawing of lots between the bonds
      (by a full repayment of individual Bonds, allocated randomly between the
      bonds).





10.3  Upon
      a
      Change of Control Event, each Bondholder shall have a right of redemption (put
      option) of its bonds at 100% (par value) plus unpaid interest on redeemed
      amount.


The
      Put
      Option must be exercised within two months after the Borrower has given
      notification as set out in Clause 13.1 (g).





The
      Put
      Option shall be exercised by the Bondholders by giving written notice of the
      request to the Bondholder’s VPS account manager. The Bondholder’s VPS account
      manager shall notify the paying agent of the Loan (the “Paying Agent”) of the
      pre-payment request. The Put Date shall be fifteen - 15 - Banking Days following
      the date when the Paying Agent received the pre-payment request.





A
      written
      request for redemption must be received by each Bondholder’s account manager at
      the latest 15 - fifteen - Banking Days prior to the redemption date pursuant
      to
      this Clause 10.3.







**11**  **Interest
      in the event of late payment**




11.1  In
      the
      event that payment of interest or principal is not made on the relevant Payment
      Date, the amount outstanding shall bear interest from the Payment Date at
      an
      interest rate equivalent to the interest rate according to Clause 9 plus
      5.00 percentage points.





11.2  The
      outstanding amounts shall bear interest as mentioned above until payment is
      made, whether or not the Loan is declared to be in default pursuant to Clause
      15.1 (a), cf. Clauses 15.2 - 15.4.







**12**  **Borrower's
      acquisition of Borrower’s Bonds**




12.1  The
      Borrower has the right to acquire and own Borrower’s Bonds. Borrower’s Bonds may
      at the Borrower's discretion be retained by the Borrower, sold or used for
      partial redemption of the Remaining Loan.







**13**  **Covenants**




13.1  During
      the term of the Loan the Borrower shall comply with the following information
      covenants:





|(a) | immediately
              inform the Loan Trustee of any default of the Loan pursuant to
              Clause 15 as well as of any circumstances which the Borrower
              understands or should understand may lead to
              default,
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




|(b) | of
              its own accord, make annual andinterim
              reportsavailable on the Borrower’s website (alternatively by sending them to the
              Loan Trustee) as soon they are available, and not later than 150 days
              after the end of the financial year and not later than 60 days after
              the
              end of the relevant interim report,
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




|(c) | at
              the request of the Loan Trustee send a report outlining the balance
              of
              Borrower’s Bonds,
|--- | -------------------------------------------------------------------------------------------------------------------------------------




|(d) | forward
              to the Loan Trustee copies of any creditors’ notifications of the
              Borrower, including but not limited to; mergers, demergers and reduction
              of shareholders capital,
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




|(e) | at
              the request of the Loan Trustee provide the documents and information
              necessary to maintain the listing and quotation of the Loan on Exchange
              (if applicable) and to otherwise enable the Loan Trustee to carry out
              its
              rights and duties pursuant to the Loan Agreement, laws and
              regulations,
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




|(f) | within
              a reasonable time limit provide information about the Borrower's financial
              condition as the Loan Trustee may reasonably
              request
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




|(g) | immediately
              notify the Bondholders (via Securities Depository), the Loan Trustee
              and
              the Exchange (if listed) if a Change of Control Event takes place,
              and
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




|(h) | in
              connection with reporting under 13.1 (b) confirm to the Loan Trustee
              the
              Borrower’s compliance with Clause 13.2 (a) and Clauses 13.3 (b) and
              (c);
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




13.2  During
      the term of the Loan, the Borrower shall comply with the following financial
      covenants:





(a)  each
      quarter demonstrate to the Loan Trustee a Value Adjusted Equity Ratio of minimum
      25 % based on independent shipbroker valuations.








13.3  During
      the term of the Loan, the Borrower shall (unless the Loan Trustee or the
      Bondholders’ meeting (as the case may be) in writing has agreed to otherwise)
      comply with the following general covenants :





|(a) | not
              in any calender year make any dividend payment, repurchase of shares
              or
              make other capital distributions to its shareholders, exceeding 50
              per
              cent of the Group’s (on consilidatet basis) net profit after taxes bases
              on the accounts of preceding financial year (any un-utilized amount
              of the
              permitted dividend pursuant to the above may not be carried forward
              to any
              subsequent calendar year),
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|(b) | not
              cease to carry on its business, and
|--- | -----------------------------------------------------




|(c) | not
              (i) sell or dispose of all or a substantial part of its operations
              or (ii)
              change the nature of its business in a manner which might jeopardize
              the
              Borrower's fulfillment of its obligations under the Loan
              Agreement.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




|(d) | not
              engage in, or permit any member of the Group to engage in, directly
              or
              indirectly, any transaction with any party (without limitation, the
              purchase, sale or exchange of assets or the rendering of any service),
              except in the ordinary course of business and pursuant to the reasonable
              requirement of the Borrower's or such member of the Group's business
              and
              upon fair and reasonable terms that are no less favorable to the Borrower
              or such member of the Group, as the case may be, than those which might
              be
              obtained in an arm's length transaction at the
              time.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------






**14**  **Fees
      and expenses**




14.1The
      Borrower shall pay an annual fee to the Loan Trustee, the amount of which is
      set
      out in a separate agreement between the Borrower and the Loan
      Trustee.





14.2The
      Borrower shall cover all expenses in connection with the Loan (and any security
      for the Loan), such as preparation of the Loan Agreement (and any security
      for
      the Loan), listing of the Loan on the Exchange (if applicable) and registration
      and administration of the Loan in the Securities Depository in accordance with
      the agreement between the Borrower and the Securities Depository.





14.3The
      Borrower shall cover any document fee and other public fees in connection with
      the Loan (and any security for the Loan). Any public fees or taxes on sales
      of
      Bonds in the secondary market shall be paid by the Bondholders, unless otherwise
      decided by law or regulation.





The
      Borrower is responsible for withholding any withholding tax imposed by Norwegian
      law.





14.4  In
      addition to the fee of the Loan Trustee pursuant to Clause 14.1 and
      normal expenses pursuant to Clauses 14.2 and 14.3 ,
      the
      Borrower shall on demand cover extraordinary expenses incurred by the Loan
      Trustee in connection with the Loan, as determined in separate agreement between
      the Borrower and the Loan Trustee. See however Clause 19.2.







**15**  **Events
      of Default**




15.1The
      Loan
      may be declared to be in default upon the occurrence of any of the following
      events (Events of Default):





(  a)the
      Borrower shall on any Payment Date fail to pay any interest or principal due
      or
      any other amount payable under the Finance Document; provided, however, that
      such failure shall not include failures which are remedied within 5 - five
      - Banking Days after the Payment Date, and it is obvious the Borrower will
      remedy the failure within this time.





(b)  the
      Borrower shall fail to duly perform any other covenant or obligation, to be
      performed under Finance Documents and such failure is not remedied within
      10 - ten - Banking Days after notice thereof is given to the
      Borrower by the Loan Trustee,





(c)  if,
      for
      each member of the Group, the
      aggregate amount of financial indebtedness or commitment for financial
      indebtedness falling within paragraphs (i) to (iv) below exceeds
      a
      total of NOK 10 million - or the equivalent thereof in other
      currencies;





(i)  any
      financial indebtedness of,
      or
      guaranteed by, is
      not
      paid when due nor within any originally applicable grace period,





(ii)  any
      financial indebtedness is declared to be or otherwise becomes due and payable
      prior to its specified maturity as a result of an event of default (however
      described),





(iii)  any
      commitment for any financial indebtedness is cancelled or suspended by a
      creditor as a result of an event of default (however described), or





(iv)  any
      creditor becomes entitled to declare any financial indebtedness of due to and
      payable prior to its specified maturity as a result of an event of default
      (however described),





|(d) | if,
              for any member of the Group;
|--- | ----------------------------------------------




(i)  it
      is
      unable or admits inability to pay its debts as they fall due, suspends making
      payments on any of its debts or, by reason of actual or anticipated financial
      difficulties, commences negotiations with one or more of its creditors with
      a
      view to rescheduling any of its indebtedness,





|(ii) | the
              value of the assets is less than its liabilities (taking into account
              contingent and prospective liabilities),
              or
|---- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------




|(iii) | a
              moratorium is declared,
|----- | ---------------------------------------




(iv)  a
      substantial part of its assets are impounded, confiscated or subject to
      distraint,





(e)  if,
      for
      any member of the Group; any
      corporate action, legal proceedings or other procedure or step (or any analogous
      procedure or step is taken in any jurisdiction) is taken in relation
      to;





(i)  the
      suspension of payments, a moratorium of any indebtedness, winding-up,
      dissolution, administration or reorganisation (by way of voluntary arrangement,
      scheme of arrangement or otherwise) other than solvent liquidation or
      reorganisation,





|(a) | a
              composition, compromise, assignment or arrangement with any
              creditor,
|--- | ---------------------------------------------------------------------------------------------------




|(b) | the
              appointment of a liquidator (other than in respect of a solvent
              liquidation), receiver, administrative receiver, administrator, compulsory
              manager or other similar officer or any of its assets;
              or
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




|(c) | enforcement
              of any security over any of its assets,
              or
|--- | ----------------------------------------------------------------------------------




|(f) | any
              representation or statement made or deemed to be made by the Borrower
              in
              the Finance Documents or any other document delivered by or on behalf
              of
              any Borrower under or in connection with any Finance Document is or
              proves
              to have been incorrect or misleading in any material respect when made
              or
              deemed to be made.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



15.2In
      the
      event that one or more of the circumstances mentioned in Clause 15.1 occurs
      and
      is continuing, the Loan Trustee can, in order to protect the interests of the
      Bondholders, declare the entire Remaining Loan including accrued interest and
      expenses to be in default and due for immediate payment. The Loan Trustee may
      at
      his discretion, on behalf of the Bondholders, take every measure necessary
      to
      recover the Loan, and all other amounts outstanding under the Loan
      Agreement.





15.3In
      the
      event that one or more of the circumstances mentioned in Clause 15.1 occurs
      and
      is continuing, the Loan Trustee shall declare the entire Remaining Loan
      including accrued interest and costs to be in default and due for payment
      if:





( a)the
      Loan
      Trustee receives a demand in writing with respect to the above from Bondholders
      representing at least 1/5 of the Outstanding Loan, and the Bondholders' meeting
      has not decided on other solutions, or





( b)the
      Bondholders' meeting has decided to declare the Loan in default and due for
      payment.





In
      either
      case the Loan Trustee shall on behalf of the Bondholders take every measure
      necessary to recover the Remaining Loan. The Loan Trustee can request
      satisfactory security for anticipated expenses from those Bondholders who
      requested that the declaration of default be made pursuant to sub clause a)
      above and/or those who voted in favour of the decision pursuant to sub clause
      b)
      above.





15.4In
      the
      event that the Loan Trustee pursuant to the terms of Clauses 15.2 or 15.3
      declares the Loan to be in default and due for payment, the Loan Trustee shall
      immediately deliver to the Borrower a notice demanding payment of interest
      and
      principal due to the Bondholders under the Loan including accrued interest
      and
      interest on overdue amounts and, in the case of the Borrower,
      expenses.





15.5  The
      individual Bondholder cannot of his own accord recover his bond(s) directly
      from
      the Borrower.







**16**  **Authority
      of the Bondholders' meeting and the Loan Trustee**




16.1To
      the
      extent creditor's approval is required according to law, regulation or
      agreement, the Bondholders' meeting may make decisions in all questions
      concerning the Loan, such as:





(a)  change
      of
      Loan Trustee,





(b)  change
      of
      Borrower,





(c)  changes
      to the Loan Agreement regarding interest, payment, maturity or other
      conditions,





(d)  changes
      in the Borrower's corporate structure, such as mergers, demergers, capital
      reduction or conversion,





(e)  approve
      the sale or other transactions concerning the Borrower’s assets,





(f)  declaring
      the Loan to be in default.





The
      Bondholders' meeting may attach conditions to its decisions.





The
      Bondholders' meeting cannot make decisions that are liable to give certain
      Bondholders or others an unreasonable advantage at the expense of other
      Bondholders.





16.2The
      Loan
      Trustee can, subject as aforesaid, on its own make a decision as mentioned
      in
      Clause16.1d),
      provided that:





(a)  the
      changes in the Borrower's corporate structure are not, in the judgement of
      the
      Loan Trustee, of significant importance for the fulfilment of the Loan
      Agreement, or





(b)  any
      security provided by the Borrower in connection with the change offers, in
      the
      judgment of the Loan Trustee, adequate security for the fulfilment of the Loan
      Agreement.





The
      Loan
      Trustee can make a decision regarding other changes in the Loan Agreement as
      mentioned in Clause 16.1 (c),
      provided that the matters in question are, in the judgment of the Loan Trustee,
      of minor importance to the Bondholders' financial and legal rights in the Loan.
      Before such a decision is made, the Bondholders shall be notified in writing
      through the Securities Depository. The notification shall clearly describe
      the
      proposal and the opinion of the Loan Trustee of it, and shall also inform that
      the proposal cannot be approved by the Loan Trustee alone if any Bondholder
      submits a written protest against the proposal, and such protest is dispatched
      within a time limit which shall not be shorter than 5
      - five
      - Banking Days from the
      dispatchment of the notification.





The
      Loan
      Trustee may attach conditions to its decision.





The
      Loan
      Trustee cannot make a decision under the Loan Agreement that is liable to give
      certain Bondholders or others unreasonable advantages at the expense of other
      Bondholders.





16.3  The
      Loan
      Trustee is free, subject as aforesaid, to submit any question to the
      Bondholders' meeting.





16.4  The
      Loan
      Trustee has the right and obligation to implement all decisions validly made
      at
      the Bondholders' meeting.





16.5  The
      Borrower, the Bondholders and - if the Loan is listed - the Exchange shall
      be
      notified of decisions made in accordance with Clauses 16.1 and 16.2 as soon
      as possible and in a suitable manner.







**17**  **Procedural
      rules**




17.1A
      Bondholders' meeting shall be held at the request of:





(a)  the
      Borrower,





(b)  Bondholders
      representing at least 1/10 of Outstanding Loan or





(c)  the
      Exchange - if the Loan is listed - or





(d)  the
      Loan
      Trustee.





A
      request
      of a Bondholders' meeting shall be made in writing and clearly state the matters
      to be discussed and the provisions of this Loan Agreement on which the request
      is based. The request shall be sent to the Loan Trustee.





17.2  The
      Bondholders' meeting shall be summoned by the Loan Trustee pursuant to the
      provisions of Clause 17.3 .
      Simultaneously with the decision to summon the Bondholders' meeting, the Loan
      Trustee can demand that the Borrower does not increase the Outstanding
      Loan.





If
      the
      Loan Trustee has not complied with a valid request for a Bondholders' meeting
      as
      set forth in Clause 17.1 within
      five Banking Days after having received such request, then the Borrower and
      the
      relevant Bondholder(s) and - if the Loan is listed - the Exchange have the
      right
      themselves to summon the meeting pursuant to the provisions of
      Clause 17.3 .





17.3The
      summons to a Bondholders' meeting shall be dispatched and if necessary notified
      at the latest five Banking Days before the date of the meeting.





The
      summons shall be effected by written notification through the Securities
      Depository to every Bondholder with known place of residence and - if the Loan
      is listed - the Exchange for publication. The notification through the
      Securities Depository shall also state the number of Bonds in the Loan
      (print-out) owned by the Bondholder in question at the time the print-out is
      made.





The
      summons shall clearly state the matters to be discussed at the Bondholders'
      meeting, and the provisions of this Loan Agreement on which the request is
      based
      and inform that the relevant documents are available from the Loan Trustee,
      the
      Borrower or at such other place as stated in the summons. If any change of
      the
      Loan Agreement has been proposed, the main content of the proposal shall be
      stated in the summons.





The
      meeting can only make decisions regarding the matters which were stated in
      the
      summons, unless all the Bondholders in the Outstanding Loan agree otherwise
      subject to the provisions hereof.





If
      in
      order to make a valid decision it is necessary, pursuant to
      Clause 18 ,
      to hold
      a new Bondholders' meeting and discuss the matter a second time,  such
      new
      Bondholders' meeting cannot be summoned before the first meeting has been held.
      The summons to the second meeting shall inform of the turnout and result of
      the
      vote at the first Bondholders' meeting.





17.4  The
      meeting shall be held at the premises of the Loan Trustee or at premises
      designated by the Loan Trustee.





The
      meeting shall be presided over by the Loan Trustee, unless the Bondholders'
      meeting decides otherwise. If the Loan Trustee is not present, the meeting
      shall
      be presided over by a Bondholder or representative of the Bondholders, elected
      by the Bondholders.





The
      minutes of the meeting shall be kept, showing the Bondholders present -
      personally or by proxy - as well as how many votes each Bondholder can cast.
      Further, the decisions made at the meeting, as well as the result of the vote,
      shall be recorded. The minutes shall be signed by the chairman and two
      Bondholders or proxies. The minutes shall be kept in a safe manner by the Loan
      Trustee, and shall be available to the Bondholders.





17.5  Bondholders,
      the Borrower, the Loan Trustee and - if the Loan is listed - the Exchange have
      the right to attend the Bondholders' meeting. The Bondholders' meeting can
      grant
      entrance to the meeting to other parties. The participants at the meeting have
      the right to meet with an advisor and/or by proxy.





17.6  At
      the
      Bondholders' meeting each Bondholder has one vote for each Bond he owns. The
      notification of the number of Bonds in the Loan (print-out) which was sent
      to
      each Bondholder through the Securities Depository in the summons to the meeting,
      see Clause 17.3 ,
      serves
      as proof of ownership of the Bonds and of each owner's right to vote. In the
      event that Bonds have been transferred after the print-out was made, the new
      Bondholder must bring to the meeting the original summons and the print-out,
      endorsed so as to document the transfer.





The
      Borrower’s Bonds do not give the right to vote and are not taken into account
      when determining the number of voting Bonds.





In
      case
      of doubt, the Bondholders' meeting decides which Bondholders can vote and how
      many votes each one has.





17.7  In
      order
      for the Bondholders' meeting to be able to make valid decisions, Bondholders
      representing at least 5/10 of the Outstanding Loan must be represented, see
      however Clause18.





Valid
      decisions may be made by a simple majority, see however Clause
      17.8.





17.8  In
      the
      following matters a majority of 2/3 of the Bonds represented at the meeting
      must
      vote in favour of the decision:





(a)  change
      of
      bondholders’ representative,





(b)  change
      of
      borrower,





(c)  changes
      in the Loan Agreement's conditions, including interest, maturity, term and
      security/collateral, or





(d)  corporate
      or business changes in the Borrower which are of significant importance for
      the
      fulfilment of the Loan Agreement.








17.9  In
      all
      matters where unanimity is not attained, the voting shall be in writing and
      the
      number of votes shall be recorded in the minutes of the meeting. In the case
      of
      a tie in the votes, the matter shall be decided by the chairman, even if he
      is
      not a Bondholder or proxy.





Decisions
      made at a Bondholders' meeting which entail changes to the Loan Agreement shall
      be attached to the Loan Agreement in the form of a certified copy of the minutes
      of the meeting.







**18********Repeated
      Bondholders' meeting**




18.1  In
      the
      event that less than 5/10 of the Outstanding Loan are represented, a valid
      decision may not be made at the first Bondholders' meeting at which the matter
      is discussed. After a new meeting has been summoned and the matter discussed
      a
      second time, a valid decision may be made pursuant to the voting rules set
      forth
      above; this also applies to cases in which less than 5/10 of the Outstanding
      Loan are represented.







**19**  **Change
      of Loan Trustee** ****




19.1  In
      the
      event that the Borrower or Bondholders in accordance with sub-clause 17.1 b)
      wish to replace the Loan Trustee, or a change of Loan Trustee is necessary
      according to law, regulation or ordinance, or the Loan Trustee has requested
      such change, the Loan Trustee shall immediately summon a Bondholders' meeting
      to
      discuss the matter.





The
      Loan
      Trustee shall put before the Bondholders' meeting a proposal for a new loan
      trustee. The bondholders, the Borrower and the Exchange - if the Loan is listed
      - can submit proposals.





The
      Bondholders and the Exchange - if the Loan is listed - shall after the
      Bondholders' meeting, be notified of the decision and the date on which the
      change of loan trustee becomes effective.





19.2The
      Loan
      Trustee shall act as Loan Trustee until a new loan trustee has been elected.
      In
      the event that the Loan Trustee does not act properly and the interests of
      the
      bondholders suffer, the Exchange may appoint a temporary loan trustee. The
      cost
      of the temporary loan trustee shall be covered by the Borrower pursuant to
      sub-clause 14.4, but may be recovered wholly or in part from the former loan
      trustee if the change is due to breach of the loan trustee's duties under the
      Loan Agreement, or other circumstances for which the loan trustee is
      responsible.





19.3  The
      Loan
      Trustee shall co-operate so that the new loan trustee is given, without undue
      delay after the Bondholders' meeting, the documents and information necessary
      to
      perform his functions and duties under the Loan Agreement. The Loan Trustee
      shall provide a summary of the following up of conditions of the Loan Agreement.







**20**  **Limitation** ****




20.1  Claims
      for interest and principal shall be limited in time pursuant to the Norwegian
      Act relating to the Limitation Period for Claims of May 18, 1979 nr.
      18.







**21**  **Dispute
      resolution and legal venue**




21.1  Disputes
      arising out of or in connection with the Loan Agreement which are not resolved
      amicably, shall be resolved in accordance with Norwegian law and in the
      Norwegian courts.





21.2  Legal
      suits shall be served at the competent legal venue of the Loan
      Trustee.














Oslo,
      11
      December 2006








**B+H
      Ocean Carriers Ltd**  **Norsk
      Tillitsmann ASA**


Borrower  Loan
      Trustee








...........................................  ...........................................











The
      Loan
      Agreement has been executed in 2 copies (originals), of which the Borrower
      and
      the Loan Trustee keep one each.