Exhibit 4.65

Private & Confidential





                               Dated 16- June 2006









                          ISOMAR MARINE COMPANY LIMITED
                                    as Owner

                         PAGEON SHIPPING COMPANY LIMITED
                                  as Charterer


                                TOP TANKERS INC.
                              as Charter Guarantor

                                       and

                          FORTIS BANK (NEDERLAND) N.V.
                                  as Mortgagee

                               QUADRIPARTITE DEED
                           relating to m.v. "Vanguard"
<PAGE>

                                    Contents

Clause                                                                    Page

1       Definitions..........................................................2

2       Representations and warranties.......................................8

3       Assignment..........................................................12

4       Owner's Assignment..................................................12

5       Continuing security and other matters.............................. 13

6       Charterer's undertakings........................................... 16

7       Charter Guarantor's undertakings....................................18

8       Covenants concerning insurance and operational matters..............22

9       Powers of Mortgagee to protect security and remedy defaults........ 29

10      Powers of Mortgagee on Event of Default.............................30

11      Application of moneys...............................................30

12      Remedies cumulative and other provisions............................32

13      Costs and indemnity.................................................32

14      Attorney............................................................33

15      Further assurance...................................................33

16      Consent, Termination of Charter and Quiet Enjoyment.................34

17      Continuation of Charter Period......................................36

18      Notices.............................................................36

19      Counterparts........................................................37

20      Severability of provisions..........................................37

21      Law and jurisdiction................................................37

Schedule 1 Forms of Loss Payable Clauses....................................39

Schedule 2 Forms of Notices of Assignment of Insurances.....................40
<PAGE>

THIS QUADRIPARTITE DEED is dated 16 June 2006 BETWEEN:

(1)     ISOMAR MARINE COMPANY LIMITED,  whose registered office is at 1 Costakis
        Pantelides  Avenue,  Kolokasides  Building,  1010  Nicosia,  Cyprus (the
        "Owner");

(2)     PAGEON SHIPPING COMPANY LIMITED, a company  incorporated in the Republic
        of Cyprus whose registered  office is at 284 Arch.  Makarios III Avenue,
        Limassol, Cyprus (the "Charterer");

(3)     TOP TANKERS INC., a company  incorporated in The Marshall  Islands whose
        registered office is at Trust Company Complex,  Ajeltake Road,  Ajeltake
        Island, Majuro, Marshall Islands MH96960 (the "Charter Guarantor"); and

(4)     FORTIS BANK (NEDERLAND) N.V., a company  incorporated  under the laws of
        The Netherlands  acting for the purposes of this Deed through its office
        at Coolsingel 93, 3012 AE Rotterdam,  The  Netherlands as security agent
        and  trustee  for  and  on  behalf  of  the   Secured   Creditors   (the
        "Mortgagee").

WHEREAS:

(A)     the Owner is the sole,  absolute and unencumbered,  legal and beneficial
        owner of all of the shares in the Ship described in clause 1.1;

(B)     by a loan agreement (the "Loan  Agreement')  dated 16 June 2006 and made
        between (1) the Owner, ICON Doubtless,  LLC, ICON Faithful, LLC and ICON
        Spotless,   LLC  (therein  and  herein  together   referred  to  as  the
        "Borrowers"),  (2) the banks and financial  institutions whose names are
        set out at schedule 1 thereto as lenders (the "Banks"),  (3) Fortis Bank
        NV/SA as  arranger  and  account  bank (in such  capacity  the  "Account
        Bank"),  (4) the  Mortgagee as agent (in such  capacity the "Agent") and
        security agent and (4) Fortis Bank (Nederland) N.V. as swap provider (in
        such  capacity the "Swap  Provider"  and together with the Agent and the
        Banks,  the  "Secured  Creditors"),  the Banks  agreed  (inter  alia) to
        advance by way of loan to the  Borrowers,  upon the terms and conditions
        therein, a maximum aggregate amount of up to $80,000,000;

(C)     by a 1992 ISDA Master  Agreement  dated t6 June 2006 (the  "Master  Swap
        Agreement")  made between (1) the Borrowers  and (2) the Swap  Provider,
        the Swap Provider  agreed the terms and  conditions  upon which it would
        enter  into  (inter  alia)  interest  rate  swap  transactions  with the
        Borrowers  in  respect of the Loan  (whether  in whole or in part as the
        case may be from time to time);

(D)     pursuant  to clause  16.14 of the Loan  Agreement,  each of the  Secured
        Creditors has appointed the Mortgagee as its security  agent and trustee
        and  pursuant  to a deed of trust  dated to June  2006  executed  by the
        Mortgagee (as trustee) in favour of the Creditors,  the Mortgagee agreed
        to hold, receive,  administer and enforce this Deed for and on behalf of
        itself and the Secured Creditors;

(E)     pursuant to the Loan Agreement and the Master Swap  Agreement  there has
        been or will be  executed  by the Owner in favour of the  Mortgagee  (as
        security agent and trustee for and on behalf of the Secured Creditors) a
        first priority statutory ship mortgage and a deed of covenant collateral
        thereto  (together the  "Mortgage") on the Ship and the Mortgage of even
        date herewith has been or will be registered under the provisions of the
        laws of Cyprus as  security  for the  payment  by the  Borrowers  of the
        Outstanding Indebtedness (which expression,  for the avoidance of doubt,
        includes the Master Swap Agreement  Liabilities)  (as those  expressions
        are defined in the Mortgage);

(F)     by a "Barecon  2001"  bareboat  charter dated 14 March 2006 made between
        Comoros  Shipping  Limited  of Cyprus  (the  "Original  Owner")  and the
        Charterer  as  novated  and  amended  in  favour  of the  Owner  and the
        Charterer  by a novation  agreement  dated 16 June 2006 made between the
        Original Owner, the Charterer and the Owner (the  "Charter"),  the Owner
        has agreed to let,  and the  Charterer  has agreed to take,  the Ship on
        demise  charter  for a period  of  sixty  (60)  months  from the date of
        delivery  of the Ship to the  Charterer  thereunder  upon the  terms and
        conditions therein mentioned;

(G)     as security for the obligations of the Charterer under the Charter,  the
        Charter  Guarantor  has or, as the case may be, will execute a guarantee
        in favour of the Owner (the "Charter Guarantee");

(H)     the Loan Agreement provided (inter alia) that, as a condition  precedent
        to the advance of the Vanguard Advance, the Owner, the Charterer and the
        Charter  Guarantor should enter into a deed supplemental to the Mortgage
        substantially  in the form of this Deed, to secure (inter alia) all sums
        of money from time to time  owing to the  Mortgagee  and/or the  Secured
        Creditors  under the Loan  Agreement,  the Master Swap Agreement and the
        other Security Documents; and

(I)     this Deed is  supplemental to the Loan Agreement and the Mortgage and to
        the  security  thereby  created and is the Vanguard  Quadripartite  Deed
        referred to in the Loan Agreement but shall nonetheless continue in full
        force and effect notwithstanding any discharge of the Mortgage.
<PAGE>

NOW THIS DEED WITNESSES AND IT IS HEREBY AGREED as follows:

1       Definitions

1.1     Definitions

        In this Deed, unless the context otherwise requires:

        "Approved  Brokers" means such firm of insurance  brokers,  appointed by
        the  Charterer  during the Charter  Period,  as may from time to time be
        approved in writing by the Mortgagee for the purposes of this Deed;

        "Casualty Amount" means Five hundred thousand Dollars ($500,000) (or the
        equivalent in any other currency);

        "Charter"  means the "Barecon 2001" demise charter between the Owner and
        the Charterer referred to in recital (F);

        "Charter Earnings" means all moneys whatsoever from time to time payable
        by the  Charterer  to the Owner under or pursuant to the Charter  and/or
        any  moneys  payable  to the  Owner  under or  pursuant  to the  Charter
        Guarantee and/or any guarantee, security or other assurance given to the
        Owner at any time in respect  of the  Charterer's  obligations  under or
        pursuant to the Charter;

        "Charterer"  includes the successors in title and permitted assignees of
        the  Charterer;   "Charterer's  Assigned  Property"  means  all  of  the
        Charterer's  rights,  title and interest in and to: (a) the  Insurances;
        and (b) any Requisition Compensation;

        "Charter  Guarantee" means the guarantee executed or (as the context may
        require) to be executed by the Charter  Guarantor in favour of the Owner
        as referred to in recital (G);

        "Charter  Guarantor"  includes  the  successors  in title and  permitted
        assignees of the Charter Guarantor;

        "Charter  Guarantor's Account" means the interest bearing Dollar account
        of the Charter  Guarantor  opened or (as the context may  require) to be
        opened  with the  Account  Bank with  account  number  24.07.56.150  and
        includes any  sub-accounts  thereof and any other account  designated in
        writing by the Mortgagee to be the Charter  Guarantor's  Account for the
        purposes of this Deed;

        "Charter  Period"  means such part of the period of the Charter as falls
        within  the  Security   Period  or,  in  the  event  of   expiration  or
        determination  of the period of the Charter  prior to the  expiration of
        the Security Period,  the period down to the expiration or determination
        of the period of the Charter;

        "Charter  Rights" means all of the rights of the Owner under or pursuant
        to the Charter, the Charter Guarantee and any other guarantee,  security
        or other  assurance  given to the  Owner at any time in  respect  of the
        Charterer's  obligations  under or  pursuant  to the  Charter  including
        (without limitation) the right to receive the Charter Earnings;

        "Code" means the International Management Code for the Safe Operation of
        Ships and for Pollution Prevention Constituted pursuant to Resolution A.
        741 (18) of the  International  Maritime  Organisation  and incorporated
        into the  International  Convention  on  Safety  of Life at Sea 1974 (as
        amended)  and  includes  any  amendment  or  extensions  thereto and any
        regulation issued pursuant thereto;

        "Collateral Instruments" means notes, bills of exchange, certificates of
        deposit and other negotiable and non-negotiable instruments, guarantees,
        indemnities and other  assurances  against  financial loss and any other
        documents or instruments  which contain or evidence an obligation  (with
        or without  security) to pay,  discharge or be  responsible  directly or
        indirectly for, any  indebtedness or liabilities of the Borrowers or any
        of them or any  other  person  liable  and  includes  any  documents  or
        instruments creating or evidencing a mortgage,  charge (whether fixed or
        floating), pledge, lien, hypothecation, assignment, trust arrangement or
        security interest of any kind;

        "Compulsory Acquisition" means requisition for title or other compulsory
        acquisition,  requisition,  appropriation,  expropriation,  deprivation,
        forfeiture or confiscation  for any reason of the Ship by any Government
        Entity or other competent  authority,  whether de jure or de facto,  but
        shall exclude  requisition for use or hire not involving  requisition of
        title;

        "DOC" means a document of compliance issued to an Operator in accordance
        with rule 13 of the Code;

        "Default" means any Event of Default or any event or circumstance  which
        with the  giving of notice or lapse of time or the  satisfaction  of any
        other condition (or any combination  thereof) would  constitute an Event
        of Default;

        "Delivery"  means  the  delivery  of the  Ship  by the  Owner,  and  the
        acceptance of the Ship by the Charterer, pursuant to the Charter;

        "Delivery Date" means the date on which Delivery occurs;

        "Encumbrance"  means any mortgage,  charge  (whether fixed or floating),
        pledge, lien, hypothecation,  assignment,  trust arrangement or security
        interest or other encumbrance of any kind securing any obligation of any
        person  or any  type  of  preferential  arrangement  (including  without
        limitation title transfer and/or retention arrangements having a similar
        effect);

        "Environmental  Affiliate"  means any agent or employee of the Charterer
        or  any  other  Relevant  Party  or  any  person  having  a  contractual
        relationship   with  the  Charterer  or  any  other  Relevant  Party  in
        connection  with any Relevant  Ship or its  operation or the carriage of
        cargo and/or  passengers  thereon  and/or the  provision of goods and/or
        services on or from the Relevant Ship;

        "Environmental  Approval" means any consent,  authorisation,  licence or
        approval of any  governmental  or public body or  authorities  or courts
        applicable  to any  Relevant  Ship or its  operation  or the carriage of
        cargo and/or  passengers  thereon  and/or the  provision of goods and/or
        services on or from such Relevant Ship required under any  Environmental
        Law;

        "Environmental Claim" means any and all enforcement,  clean-up,  removal
        or other  governmental  or  regulatory  actions or orders  instituted or
        completed  pursuant  to  any  Environmental  Law  or  any  Environmental
        Approval  together  with  claims  made by any third  party  relating  to
        damage,  contribution,  loss or  injury,  resulting  from any  actual or
        threatened emission, spill, release or discharge of a Pollutant from any
        Relevant Ship;

        "Environmental  Laws" means all national,  international and state laws,
        rules, regulations,  treaties and conventions applicable to any Relevant
        Ship  pertaining  to the  pollution or protection of human health or the
        environment  including,  without limitation,  the carriage of Pollutants
        and actual or threatened  emissions,  spills,  releases or discharges of
        Pollutants;

        "Event of Default" means any of the events or circumstances described in
        clause 10.1 of the Loan Agreement;

        "Expenses"  means the aggregate at any relevant time (to the extent that
        the same have not been received or recovered by the Mortgagee) of:

        (a) all  losses,  liabilities,  costs,  charges,  expenses,  damages and
        outgoings of whatever  nature  (including,  without  limitation,  Taxes,
        registration fees and insurance premiums) suffered,  incurred or paid by
        the Mortgagee in connection  with the exercise of the powers referred to
        in or  granted  by this  Deed  or  otherwise  payable  by the  Owner  in
        accordance with clause 13; and

        (b) interest on all such losses, liabilities,  costs, charges, expenses,
        damages  and  outgoings  from the date on which the same were  suffered,
        incurred or paid by the Mortgagee  until the date of receipt or recovery
        thereof  (whether  before  or  after  judgment)  at  a  rate  per  annum
        calculated  in  accordance  with  clause 3.4 of the Loan  Agreement  (as
        conclusively certified by the Mortgagee);

        "Government  Entity" means and includes (whether having a distinct legal
        personality or not) any national or local government  authority,  board,
        commission,  department,  division,  organ,  instrumentality,  court  or
        agency and any association,  organisation or institution of which any of
        the foregoing is a member or to whose  jurisdiction any of the foregoing
        is subject or in whose activities any of the foregoing is a participant;

        "Incapacity"  means,  in  relation to a person,  the death,  bankruptcy,
        unsoundness of mind, insolvency, liquidation,  dissolution,  winding-up,
        administration,  receivership,  amalgamation,  reconstruction  or  other
        incapacity of that person whatsoever (and, in the case of a partnership,
        includes  the   termination   or  change  in  the   composition  of  the
        partnership);

        "Insurances"  means all  policies  and  contracts  of  insurance  (which
        expression  includes  all  entries  of  the  Ship  in a  protection  and
        indemnity or war risks  association)  which are from time to time during
        the Security  Period in place or taken out or entered into by or for the
        benefit of, among others, the Owner and/or the Charterer (whether in the
        sole  name  of the  Owner,  or in the  joint  names  of the  Owner,  the
        Charterer  and the  Mortgagee or  otherwise) in respect of the Ship (but
        not loss of earnings) or otherwise howsoever in connection with the Ship
        and all benefits  thereof  (including  claims of  whatsoever  nature and
        return of premiums);

        "ISPS Code" means the International Ship and Port Facility Security Code
        constituted  pursuant  to  resolution  A.924(22)  of  the  International
        Maritime  Organization now set out in Chapter XI-2 of the  International
        Convention for the Safety of Life at Sea 1974 (as amended) as adopted by
        a Diplomatic  Conference of the International  Maritime  Organisation on
        Maritime  Security in  December  2002 and  includes  any  amendments  or
        extensions thereto and any regulation issued pursuant thereto;

        "ISSC"  means an  International  Ship  Security  Certificate  issued  in
        respect of the Ship pursuant to the ISPC Code;

        "Loan" means the aggregate principal amount owing to the Banks or any of
        them pursuant to the Loan Agreement at any relevant time;

        "Loan Agreement"  means the agreement  referred to in recital (B) hereto
        as the same may from time to time be supplemented and/or amended;

        "Loss Payable  Clauses"  means the  provisions  regulating the manner of
        payment  of  sums  receivable  under  the  Insurances  which  are  to be
        incorporated  in the  relevant  insurance  documents,  such Loss Payable
        Clauses  to be in the forms set out in  schedule  1 during  the  Charter
        Period (which  shall,  during the Charter  Period,  replace the forms of
        Loss Payable Clauses  specified in the Vanguard  General  Assignment (as
        such term is defined in the Loan  Agreement))  or in such other forms as
        may from time to time be required or agreed in writing by the Mortgagee;

        "Master  Swap  Agreement"  means the 1992  ISDA  Master  Agreement  made
        between the Swap Provider and the Borrowers dated June 2006 mentioned in
        recital  (C) hereto,  comprising  a 1992 ISDA  Master  Agreement  (and a
        Schedule thereto),  together with any Confirmations (as defined therein)
        supplemental thereto;

        "Master Swap  Agreement  Liabilities"  means,  at any relevant time, all
        liabilities,  actual or contingent, present or future, owing to the Swap
        Provider under the Master Swap Agreement;

        "Mortgage"  means  the first  priority  statutory  mortgage  and deed of
        covenant collateral thereto mentioned in recital (E) hereto;

        "Mortgagee"  includes the  successors in title and  replacements  of the
        Mortgagee;

        "Notice of Assignment of Insurances" means a notice of assignment in the
        form set out in  schedule  2 during the  Charter  Period  (which  shall,
        during the Charter  Period,  replace the form of Notice of Assignment of
        Insurances  specified in the Vanguard  General  Assignment),  or in such
        other form as may from time to time be  required or agreed in writing by
        the Mortgagee;

        "Operator" means any person who is from time to time during the Security
        Period  concerned  in the  operation  of the Ship and falls  within  the
        definition of "Company" set in rule 1.1.2 of the Code;

        "Other  Ships"  means  together,  Doubtless,  Faithful  and Spotless and
        "Other Ship" means any of them;

        "Outstanding  Indebtedness" means the aggregate of the Loan and interest
        accrued and accruing thereon, the Master Swap Agreement Liabilities, the
        Expenses  and all other  sums of money  from  time to time  owing by the
        Borrowers to the Mortgagee and/or any of the Secured Creditors,  whether
        actually or  contingently,  present or future,  under or pursuant to the
        Loan Agreement, the Master Swap Agreement, the Security Documents or any
        of them;

        "Owner" includes the successors in title of the Owner; "Owner's Assigned
        Property" means:  (a) the Charter;  (b) the Charter  Guarantee;  (c) the
        Charter Earnings; and (d) all other Charter Rights;

        "Pollutant"   means  and  includes   pollutants,   contaminants,   toxic
        substances,  oil as defined in the United  States Oil  Pollution  Act of
        1990 and all  hazardous  substances  as  defined  in the  United  States
        Comprehensive  Environmental  Response,  Compensation  and Liability Act
        1980;

        "Related  Company" of a person means any Subsidiary of such person,  any
        company or other  entity of which such  person is a  Subsidiary  and any
        Subsidiary of any such company or entity;

        "Relevant  Party" means the Owner,  the Owner's Related  Companies,  any
        other Security Party and any other Security Party's Related Companies;

        "Relevant  Ship"  means the Ship and any other  vessel from time to time
        (whether before or after the date of this Deed) owned, managed or crewed
        by, or chartered to, any Relevant Party;

        "Requisition Compensation" means all sums of money or other compensation
        from time to time payable  during the  Security  Period by reason of the
        Compulsory Acquisition of the Ship;

        "Security  Documents" means the Loan Agreement,  this Deed, the Mortgage
        and any other such  document  as is defined in the Loan  Agreement  as a
        Security  Document or as may have been or may  hereafter  be executed to
        guarantee  and/or  secure  all or any  part of the  Loan,  any  interest
        thereon, the Master Swap Agreement  Liabilities and the moneys from time
        to time  owing  by the  Borrowers  or any of them  pursuant  to the Loan
        Agreement  and/or the Master  Swap  Agreement  or by any other  Security
        Party  pursuant  to any other  Security  Document  (whether  or not such
        documents,  also secure  moneys from time to time owing  pursuant to any
        other document or agreement);

        "Security  Party" means any person who may at any time be a party to any
        of the Security Documents (other than the Secured Creditors);

        "Security  Period"  means the period  commencing  on the date hereof and
        terminating  upon  discharge  of the  security  created by the  Security
        Documents by payment of all moneys payable thereunder;

        "Ship" means the m.v.  "Vanguard'  registered as a Cyprus ship under IMO
        Number  8913605  and  includes  any share or  interest  therein  and her
        engines,  machinery, boats, tackle, outfit, equipment, spare gear, fuel,
        consumable  or other stores,  belongings  and  appurtenances  whether on
        board or ashore and whether now owned or hereafter acquired and also any
        and all additions, improvements and replacements hereafter made in or to
        such  vessel  or  any  part  thereof  or  in  or to  her  equipment  and
        appurtenances aforesaid;

        "SMC" means a safety management  certificate issued in respect of a ship
        in accordance with rule 13 of the Code;

        "Subsidiary"  of a person  means  any  company  or  entity  directly  or
        indirectly  controlled  by such person,  and for this purpose  "control"
        means either the  ownership of more than 50% of the voting share capital
        (or  equivalent  rights of  ownership)  of such company or entity or the
        power to direct its  policies  and  management,  whether by  contract or
        otherwise; and

        "Total Loss" means:

        (a)     the actual, constructive,  compromised or arranged total loss of
                the Ship; or

        (b)     the Compulsory Acquisition of the Ship; or

        (c)     the hijacking,  theft,  condemnation,  capture, seizure, arrest,
                detention or confiscation of the Ship (other than where the same
                amounts  to  the  Compulsory  Acquisition  of the  Ship)  by any
                Government  Entity, or by persons acting or purporting to act on
                behalf of any Government Entity, unless the Ship be released and
                restored  to the  Owner  or  (during  the  Charter  Period)  the
                Charterer  (as the  case  may be) from  such  hijacking,  theft,
                condemnation,    capture,    seizure,   arrest,   detention   or
                confiscation  within  thirty  (30)  days  after  the  occurrence
                thereof.

1.2     Insurance terms

        In clause 8.1.1:

        1.2.1   "excess  risks"  means the  proportion  (if any) of  claims  for
                general  average,  salvage  and  salvage  charges  and under the
                ordinary  collision clause not recoverable in consequence of the
                value at which  the Ship is  assessed  for the  purpose  of such
                claims exceeding her insured value;

        1.2.2   "protection   and   indemnity   risks"  means  the  usual  risks
                (including  oil  pollution  and freight,  demurrage  and defence
                cover)  covered by a United  Kingdom  protection  and  indemnity
                association or a protection and indemnity  association  which is
                managed in London (including, without limitation, the proportion
                (if any) of any sums  payable to any other  person or persons in
                case of collision which are not  recoverable  under the hull and
                machinery  policies  by  reasons  of the  incorporation  in such
                policies  of  clause 8 of the  Institute  Time  Clauses  (Hulls)
                (1/11/95) or the Institute Amended Running Down Clause (1/10/71)
                or any equivalent provision); and

        1.2.3   "war risks" includes those risks covered by the standard form of
                English  marine policy with  Institute  War and Strikes  Clauses
                Hulls - Time (1/11/95) attached or similar cover.

1.3     Headings

        Clause  headings and the table of contents are inserted for  convenience
        of  reference  only and shall be ignored in the  interpretation  of this
        Deed.

1.4     Construction of certain terms

        In this Deed, unless the context otherwise requires:

        1.4.1   references  to clauses  and  Schedules  are to be  construed  as
                references  to  clauses  of,  and  Schedules  to,  this Deed and
                references to this Deed include its Schedules;

        1.4.2   references  to (or to any  specified  provision of) this Deed or
                any other  document  shall be  construed as  references  to this
                Deed,  that  provision or that document as in force for the time
                being and as amended in accordance  with the terms thereof,  or,
                as the case may be, with the agreement of the relevant parties;

        1.4.3   words  importing  the plural shall include the singular and vice
                versa;

        1.4.4   references  to a person shall be construed as  references  to an
                individual, firm, company,  corporation,  unincorporated body of
                persons or any Government Entity;

        1.4.5   references  to a  "guarantee"  shall  include  references  to an
                indemnity or other assurance  against  financial loss including,
                without limitation, an obligation to purchase assets or services
                as a  consequence  of a default  by any other  person to pay any
                Indebtedness  and "guaranteed"  shall be construed  accordingly;
                and

        1.4.6   references  to  statutory   provisions  shall  be  construed  as
                references  to  those  provisions  as  replaced  or  amended  or
                re-enacted from time to time.

1.5     Conflict with Loan Agreement

        As between the Owner and the Mortgagee, this Deed shall be read together
        with the Loan  Agreement  but in case of any  conflict  between  the two
        instruments, the provisions of the Loan Agreement shall prevail.

1.6     Conflict with Charter

        If and to the extent that any of the covenants and undertakings given by
        the  Charterer in this Deed may conflict  with any of the  provisions of
        the Charter,  such  covenants  and  undertakings  of this Deed shall (as
        between the Mortgagee on the one hand and the Owner and the Charterer on
        the other hand but not  otherwise)  prevail over such  provisions of the
        Charter.

2       Representations and warranties

        2.1     Charterer's continuing representations and warranties

                The  Charterer  represents  and  warrants to the  Mortgagee  (as
                security  agent and  trustee  for and on  behalf of the  Secured
                Creditors) and the Owner that:

        2.1.1   Due incorporation

                it is duly  incorporated  and validly  existing in good standing
                under the laws of the Republic of Cyprus as a limited  liability
                company  and has  power to carry  on its  business  as it is now
                being conducted and to own its property and other assets;

        2.1.2   Corporate power

                it has power to execute,  deliver  and  perform its  obligations
                under the Charter and such of the Security Documents to which it
                is,  or  is  to  be,  a  party  and  all  necessary   corporate,
                shareholder  and other  action has been taken to  authorise  the
                execution, delivery and performance of the same;

        2.1.3   Binding obligations

                the Charter and the Security  Documents to which it is, or is to
                be, a party  constitute or will,  when executed,  constitute its
                valid and legally binding obligations  enforceable in accordance
                with their respective terms;

        2.1.4   No conflict with other obligations

                the   execution  and  delivery  of,  the   performance   of  its
                obligations  under,  and  compliance  with the provisions of the
                Charter and the Security  Documents to which it is, or is to be,
                a party by it will not (a) contravene,  any existing  applicable
                law,  statute,  rule or regulation  or any  judgment,  decree or
                permit to which it is  subject,  or (b)  contravene  or conflict
                with any provision of its constitutional documents;

        2.1.5   No filings required

                it  is  not   necessary  to  ensure  the   legality,   validity,
                enforceability  or  admissibility  in evidence of the Charter or
                any of the  Security  Documents  to which it is,  or is to be, a
                party that they or any other  instrument  be  notarised,  filed,
                recorded,  registered or enrolled in any court, public office or
                elsewhere  in any  Relevant  Jurisdiction  or  that  any  stamp,
                registration  or similar  tax or charge be paid in any  Relevant
                Jurisdiction  on or in  relation  to the  Charter or any of such
                Security  Documents  and the Charter  and each of such  Security
                Documents are in proper form for its  enforcement  in the courts
                of each Relevant Jurisdiction;

        2.1.6   Choice of law

                the choice of English law to govern the Charter and the Security
                Documents  to  which  it  is,  or is to  be,  a  party  and  the
                submission by the Charterer to the non-exclusive jurisdiction of
                the English courts are valid and binding;

        2.1.7   No material adverse change

                there  has been no  material  adverse  change  in the  financial
                position of the Charterer  from that  disclosed by the Charterer
                to the Arranger  and/or the Agent in the negotiation of the Loan
                Agreement;

        2.1.8   No immunity

                neither it nor any of its assets is  entitled to immunity on the
                grounds of  sovereignty  or  otherwise  from any legal action or
                proceeding  (which  shall  include,  without  limitation,  suit,
                attachment prior to judgment,  execution or other  enforcement);
                and

        2.1.9   Consents obtained

                every  consent,  authorisation,   licence  or  approval  of,  or
                registration  with or  declaration  to,  governmental  or public
                bodies or authorities or courts required by it to authorise,  or
                required by it in  connection  with,  the  execution,  delivery,
                validity,  enforceability  or  admissibility  in evidence of the
                Charter and the Security  Documents to which it is, or is to be,
                a party or the  performance by it of its  obligations  under the
                Charter and such Security  Documents  have been obtained or made
                and are in full  force and  effect and there has been no default
                in the observance of any of the conditions or  restrictions  (if
                any) imposed in, or in connection with, any of the same.

2.2     Charter Guarantor's continuing representations and warranties

        The Charter  Guarantor  represents  and  warrants to the  Mortgagee  (as
        security  agent and trustee for and on behalf of the Secured  Creditors)
        and the Owner that:

        2.2.1   Due incorporation

                it is duly  incorporated  and validly  existing in good standing
                under the laws of the  Marshall  Islands as a  Marshall  Islands
                corporation  and has power to carry on its business as it is now
                being conducted and to own its property and other assets;

        2.2.2   Corporate power

                it has power to execute,  deliver  and  perform its  obligations
                under  the  Charter  Guarantee  and this  Deed and has  power to
                execute  and  deliver  and  perform  its  obligations  under the
                Charter  Guarantee and this Deed,  and all necessary  corporate,
                shareholder  and other  action has been taken to  authorise  the
                execution,   delivery  and   performance  of  the  same  and  no
                limitation  on the  powers  of the  Charter  Guarantor  to  give
                guarantees  or  security  will be  exceeded  as a result  of the
                execution,  delivery and performance of the Charter Guarantee or
                the Charter Guarantor's obligations under this Deed;

        2.2.3   Binding obligations

                the Charter  Guarantee and this Deed  constitute  or will,  when
                executed,  constitute its valid and legally binding  obligations
                enforceable in accordance with their respective terms;

        2.2.4   No conflict with other obligations

                the   execution  and  delivery  of,  the   performance   of  its
                obligations  under,  and  compliance  with the provisions of the
                Charter  Guarantee and this Deed by it will not (a)  contravene,
                any existing applicable law, statute,  rule or regulation or any
                judgment,  decree  or  permit  to  which  it is  subject  or (b)
                contravene or conflict with any provision of its  constitutional
                documents;

        2.2.5   No filings required

                it  is  not   necessary  to  ensure  the   legality,   validity,
                enforceability  or  admissibility  in  evidence  of the  Charter
                Guarantee  or this Deed that  they or any  other  instrument  be
                notarised, filed, recorded, registered or enrolled in any court,
                public office or elsewhere in any Relevant  Jurisdiction or that
                any stamp,  registration or similar tax or charge be paid in any
                Relevant Jurisdiction on or in relation to the Charter Guarantee
                or this Deed and both the Charter Guarantee and this Deed are in
                proper form for their enforcement in the courts of each Relevant
                Jurisdiction;

        2.2.6   Choice of law

                the choice of English  law to govern the Charter  Guarantee  and
                this Deed and the  submission  by the Charter  Guarantor  to the
                non-exclusive  jurisdiction  of the English courts are valid and
                binding;

        2.2.7   No material adverse change

                there  has been no  material  adverse  change  in the  financial
                position of the Charter  Guarantor  from that  disclosed  by the
                Charter  Guarantor  to the  Arranger  and/or  the  Agent  in the
                negotiation of the Loan Agreement;

        2.2.8   No immunity

                neither it nor any of its assets is  entitled to immunity on the
                grounds of  sovereignty  or  otherwise  from any legal action or
                proceeding  (which  shall  include,  without  limitation,  suit,
                attachment prior to judgement,  execution or other enforcement);
                and

        2.2.9   Consents obtained

                every  consent,  authorisation,   licence  or  approval  of,  or
                registration  with or  declaration  to,  governmental  or public
                bodies  or  authorities  or  courts   required  by  the  Charter
                Guarantor to authorise,  or required by the Charter Guarantor in
                connection    with,   the   execution,    delivery,    validity,
                enforceability  or  admissibility  in  evidence  of the  Charter
                Guarantee  and  this  Deed  or the  performance  by the  Charter
                Guarantor of its  obligations  under the Charter  Guarantee  and
                this  Deed has been  obtained  or made and is in full  force and
                effect and there has been no default in the observance of any of
                the  conditions  or  restrictions  (if any)  imposed  in,  or in
                connection with, any of the same.

2.3     Charterer's initial representations and warranties

        The  Charterer  represents  and warrants to the  Mortgagee  (as security
        agent and trustee for and on behalf of the  Secured  Creditors)  and the
        Owner that:

        2.3.1   No withholding Taxes

                no Taxes are imposed by  withholding or otherwise on any payment
                to be made by it under the Charter or the Security  Documents to
                which it is, or is to be, a party or are imposed on or by virtue
                of its  execution  or  delivery  of the  Charter  or any of such
                Security  Documents or any other  document or  instrument  to be
                executed or delivered  under the Charter or any of such Security
                Documents;

        2.3.2   Ship's employment

                (save for the Charter and the Vanguard Time Charter) the Ship is
                not and will not on the Delivery  Date be subject to any charter
                or  contract  or to any  agreement  to enter into any charter or
                contract entered into by the Charterer which, if entered into by
                it after the date of this Deed,  would have required the consent
                of the Mortgagee;

        2.3.3   Freedom from Encumbrances

                the  Charterer is the sole,  legal and  beneficial  owner of the
                whole of the  Charterer's  Assigned  Property  and  neither  the
                Charterer's  Assigned  Property nor any part thereof are or will
                be on the Delivery Date subject to any Encumbrance created by it
                or arising due to its act or omission or its use or operation of
                the Ship and it has not (save as  disclosed  in  writing  to the
                Mortgagee)  received  notice  of  any  Encumbrance  (other  than
                pursuant to this Deed) in respect  thereof  created by any other
                person;

        2.3.4   Commissions etc.

                there are no commissions, rebates, premiums or other payments in
                connection  with the  Charter  other  than as  disclosed  to the
                Mortgagee in writing prior to the date hereof;

        2.3.5   Compliance with Environmental Laws and Approvals

                except as may already  have been  disclosed by it in writing to,
                and acknowledged in writing by, the Mortgagee:

                (a)     the  Charterer  and to the  best  of its  knowledge  and
                        belief  (having  made  due  enquiry)  its  Environmental
                        Affiliates  have  complied  with the  provisions  of all
                        Environmental Laws;

                (b)     the  Charterer  and to the  best  of its  knowledge  and
                        belief  (having  made  due  enquiry)  its  Environmental
                        Affiliates have obtained all Environmental Approvals and
                        are in compliance with all such Environmental Approvals;
                        and

                (c)     neither the  Charterer  nor to the best of its knowledge
                        and  belief   (having  made  due  enquiry)  any  of  its
                        Environmental  Affiliates  has  received  notice  of any
                        Environmental  Claim  that  the  Charterer  or any  such
                        Environmental  Affiliate is not in  compliance  with any
                        Environmental Law or any Environmental Approval;

        2.3.6   No Environmental Claims

                except as may already  have been  disclosed by it in writing to,
                and  acknowledged  in  writing  by, the  Mortgagee,  there is no
                Environmental Claim pending or, to the best of its knowledge and
                belief  (having  made  due  enquiry),   threatened  against  the
                Charterer or the Ship or any other ship owned, managed or crewed
                by,  or  chartered  to,  the  Charterer  or,  to the best of its
                knowledge  and  belief  (having  made  due  enquiry)  any of its
                Environmental Affiliates; and

        2.3.7   No potential Environmental Claims

                except as may already  have been  disclosed by it in writing to,
                and acknowledged in writing by, the Mortgagee, there has been no
                emission,  spill,  release or discharge of a Pollutant  from the
                Ship or any other  ship  owned  by,  managed  or  crewed  by, or
                chartered to, the Charterer nor to the best of its knowledge and
                belief  (having made due enquiry)  from any other ship owned by,
                managed or crewed by, or chartered to, the Charterer which could
                give rise to an Environmental Claim.

        2.4     Charter Guarantor's initial representations and warranties

                The Charter  Guarantor  represents and warrants to the Mortgagee
                (as security  agent and trustee for and on behalf of the Secured
                Creditors)   and  the  Owner  that  no  Taxes  are   imposed  by
                withholding  or  otherwise on any payment to be made by it under
                the  Charter  Guarantee  or are  imposed  on or by virtue of its
                execution  or delivery of the Charter  Guarantee or this Deed or
                any other  document or  instrument  to be executed or  delivered
                under the Charter Guarantee or this Deed.

2.5     Repetition of representations and warranties

        On  and  as of  the  Delivery  Date  and  (except  in  relation  to  the
        representations  and warranties in clauses 2.3, 2.4 and 5) each Interest
        Payment Date during the Charter  Period,  the  Charterer and the Charter
        Guarantor shall be deemed to repeat the  representations  and warranties
        in clauses 2.1, 2.2, 2.3 and 2.4 as if made with  reference to the facts
        and circumstances existing on such day.
<PAGE>

3       Assignment

3.1     Charterer's Assignment

        By way of security for the Outstanding  Indebtedness  (which expression,
        for  the  avoidance  of  doubt,   includes  the  Master  Swap  Agreement
        Liabilities)  the Charterer with full title guarantee hereby assigns and
        agrees to assign to the Mortgagee  absolutely all its rights,  title and
        interest  in  and to the  Charterer's  Assigned  Property  and  all  its
        benefits and interests present and future therein. Provided however that
        unless  and  until  a  Default  shall  occur  (whereupon  all  insurance
        recoveries   shall  be  receivable  by  the  Mortgagee  and  applied  in
        accordance with clause 11.1 or clause 11.3 (as the case may be)):

        3.1.1   any moneys  payable  under the  Insurances,  shall be payable in
                accordance  with the terms of the relevant  Loss Payable  Clause
                and the Mortgagee will not in the meantime give any notification
                to the  contrary  to the  insurers as  contemplated  by the Loss
                Payable Clauses; and

        3.1.2   any insurance moneys received by the Mortgagee in respect of any
                major  casualty  (as  specified  in the  relevant  Loss  Payable
                Clause) shall, unless prior to receipt or whilst such moneys are
                in the  hands of the  Mortgagee  there  shall  have  occurred  a
                Default  (whereupon  such  insurance  monies shall be applied in
                accordance  with  clause  11.1 or  clause  11.3 (as the case may
                be)),  be  paid  over  to  the  Charterer   upon  the  Charterer
                furnishing evidence  satisfactory to the Mortgagee that all loss
                and damage  resulting  from such casualty has been properly made
                good and  repaired,  and  that all  repair  accounts  and  other
                liabilities whatsoever in connection with the casualty have been
                fully paid and  discharged by the  Charterer,  provided  however
                that the  insurers  with  whom the fire and usual  marine  risks
                insurances  are effected  may, in the case of a major  casualty,
                and with the previous consent in writing of the Mortgagee,  make
                payment on account of repairs in the course of being effected.

3.2     Use of Charterer's name

        The  Charterer  covenants  and  undertakes  with the  Mortgagee to do or
        permit to be done each and every act or thing  which the  Mortgagee  may
        from time to time  require to be done for the purpose of  enforcing  the
        Mortgagee's  rights  under this Deed and to allow its name to be used as
        and when required by the Mortgagee for that purpose.

3.3     Reassignment

        Upon payment and discharge in full to the  satisfaction of the Mortgagee
        of the Outstanding Indebtedness, the Mortgagee shall, at the request and
        cost of the Charterer,  re-assign the Charterer's  Assigned  Property to
        the Charterer or as it may direct.

3.4     Liability of Charterer

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

4       Owner's Assignment

4.1     Assignment

        By way of security for payment of the  Outstanding  Indebtedness  (which
        expression,  for the  avoidance  of  doubt,  includes  the  Master  Swap
        Agreement  Liabilities)  the Owner  with  full  title  guarantee  hereby
        assigns and agrees to assign to the  Mortgagee  (as  security  agent and
        trustee on behalf of the Secured  Creditors)  absolutely all its rights,
        title and  interest  in and to the  Owner's  Assigned  Property  and all
        benefits  accruing to the Owner  thereunder  Provided  however  that the
        Charter Earnings shall be payable to the Vanguard  Operating Account (as
        such term is defined in the Loan Agreement) until such time as a Default
        shall occur and the Mortgagee shall direct to the contrary whereupon the
        Owner shall  forthwith,  and the Mortgagee  may at any time  thereafter,
        instruct the persons from whom the Charter  Earnings are then payable to
        pay the same to the Mortgagee  (as security  agent and trustee on behalf
        of the Secured  Creditors) or as it may direct and any Charter  Earnings
        then in the hands of the Owner's brokers or other agents shall be deemed
        to have  been  received  by  them  for  the  use  and on  behalf  of the
        Mortgagee.

4.2     Use of Owner's name

        The Owner covenants and undertakes with the Mortgagee to do or permit to
        be done each and every act or thing which the Mortgagee may from time to
        time  require to be done for the purpose of  enforcing  the  Mortgagee's
        rights  under  this  Deed and to  allow  its name to be used as and when
        required by the Mortgagee for that purpose.

4.3     Reassignment

        Upon payment and discharge in full to the  satisfaction of the Mortgagee
        of the Outstanding Indebtedness, the Mortgagee shall, at the request and
        cost of the Owner,  re-assign the Owner's Assigned Property to the Owner
        or as it may direct.

4.4     Liability of Owner

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

4.5     Acknowledgement by Charterer

        By its  execution of this Deed,  each of the  Charterer  and the Charter
        Guarantor  has  received   written  notice  of,  and  consents  to,  the
        assignment to the Mortgagee of the Charter,  the Charter  Earnings,  the
        other Charter Rights and the Charter Guarantee.

5       Continuing security and other matters

5.1     Continuing security

        The security created by this Deed shall:

        5.1.1   be held by the Mortgagee (as security  agent and trustee for and
                on behalf of the Secured Creditors) as a continuing security for
                the payment of the Outstanding  Indebtedness  (which expression,
                for the avoidance of doubt,  includes the Master Swap  Agreement
                Liabilities)   and  the   performance   and  observance  of  and
                compliance  with  all of the  covenants,  terms  and  conditions
                contained in the  Security  Documents,  express or implied,  and
                that the  security  so  created  shall not be  satisfied  by any
                intermediate  payment or  satisfaction of any part of the amount
                hereby and  thereby  secured (or by any  settlement  of accounts
                between  the Owner or any other  person who may be liable to the
                Mortgagee  and/or  the  Secured  Creditors  in  respect  of  the
                Outstanding Indebtedness (which expression, for the avoidance of
                doubt,  includes the Master Swap Agreement  Liabilities)  or any
                part thereof and the Mortgagee and/or the Secured Creditors) and
                shall  remain in full  force and  effect  until the  Outstanding
                Indebtedness  (which  expression,  for the  avoidance  of doubt,
                includes  the  Master  Swap  Agreement   Liabilities)  has  been
                discharged in full (which  expression  shall not embrace payment
                or a dividend in liquidation or bankruptcy of less than 100%);

        5.1.2   be in addition to, and shall not in any way prejudice or affect,
                and may be enforced by the Mortgagee  without prior recourse to,
                the security  created by any other of the Security  Documents or
                by any present or future Collateral Instruments, right or remedy
                held  by or  available  to  the  Mortgagee  and/or  the  Secured
                Creditors  or any of them any right or  remedy of the  Mortgagee
                and/or  the  Secured  Creditors  or any of them or any  right or
                remedy of the Mortgagee thereunder;

        5.1.3   not be in any way prejudiced or affected by the existence of any
                of  the  other  Security   Documents  or  any  such   Collateral
                Instrument, rights or remedies or by the same becoming wholly or
                in part void, voidable or unenforceable on any ground whatsoever
                or by the Mortgagee and/or the Secured  Creditors or any of them
                dealing  with,  exchanging,  varying  or  failing  to perfect or
                enforce  any  of  the  same,  or  giving  time  for  payment  or
                performance or indulgence or  compounding  with any other person
                liable; and

        5.1.4   not in any way be  prejudiced  or  affected by any change in the
                constitution  of, or any amalgamation or  reconstruction  of the
                Owner,  the  Mortgagee  or any  other  person  or by  any  legal
                limitation,   disability,   incapacity  or  other  circumstances
                relating to the Owner or any other person,  whether or not known
                to the Mortgagee and/or the Secured Creditors, by any invalidity
                in or irregularity or unenforceability of the obligations of the
                Owner or any other person under the Loan Agreement or any of the
                other  Security  Documents or otherwise and so that in the event
                that any obligation or purported  obligation of the Owner or any
                other person which, if enforceable or valid or continuing, would
                be  secured  by  this  Deed  is or  becomes  wholly  or in  part
                unenforceable   or   invalid  or   terminated   for  any  reason
                whatsoever,  the Owner will keep the  Mortgagee  and the Secured
                Creditors  fully  indemnified  against any loss  suffered by the
                Mortgagee  and/or  the  Secured  Creditors  as a  result  of any
                failure  by the Owner or such other  party to  perform  any such
                obligation or purported obligation.

5.2     Rights additional and no enquiry

        5.2.1   Rights additional

                All the rights,  remedies and powers vested in the Mortgagee (as
                security  agent and trustee on behalf of the Secured  Creditors)
                hereunder  shall be in addition to and not a  limitation  of any
                and every other right,  power or remedy  vested in the Mortgagee
                and/or  the  Secured  Creditors  or any of them  under  the Loan
                Agreement,  this Deed,  the  Master  Swap  Agreement,  the other
                Security  Documents or any such Collateral  Instrument or at law
                and that all the  powers so vested in the  Mortgagee  and/or the
                Secured  Creditors or any of them may be exercised  from time to
                time and as often as the Mortgagee and/or the Secured  Creditors
                or any of them may deem expedient.

        5.2.2   No enquiry

                The Mortgagee shall not be obliged to make any enquiry as to the
                nature or sufficiency  of any payment  received by it under this
                Deed or to make any  claim or take any  action  to  collect  any
                moneys  hereby  assigned  or to enforce  any rights or  benefits
                hereby  assigned to the  Mortgagee or to which the Mortgagee (as
                security  agent and trustee on behalf of the  Creditors)  may at
                any time be entitled under this Deed.

5.3     Obligations of Owner, Charterer and Mortgagee

        The Owner and the Charterer  shall each remain liable to perform all the
        obligations  assumed by it in relation to the Owner's Assigned  Property
        and the Charterer's  Assigned  Property and the Mortgagee shall be under
        no obligation of any kind  whatsoever in respect thereof or be under any
        liability  whatsoever  in the event of any  failure  by the Owner or the
        Charterer to perform its obligations in respect thereof.

5.4     Discharge of Mortgage

        This Deed shall continue in full force and effect after any discharge of
        the  Mortgage.

5.5     Liability  unconditional  The rights,  remedies and powers vested in the
        Mortgagee  under this Deed shall not be affected  nor shall this Deed be
        discharged or reduced by reason of:

        5.5.1   the Incapacity or any change in the name,  style or constitution
                of the Owner or any other person liable;

        5.5.2   the Mortgagee granting any time, indulgence or concession to, or
                compounding   with,   discharging,   releasing  or  varying  the
                liability of the Owner or any other  person  liable or renewing,
                determining,  varying or increasing any accommodation,  facility
                or transaction or otherwise  dealing with the same in any manner
                whatsoever   or   concurring   in,   accepting  or  varying  any
                compromise,  arrangement  or  settlement or omitting to claim or
                enforce payment from the Owner or any other person liable; or

        5.5.3   any act or omission which would not have  discharged or affected
                the security constituted by the Charterer under this Deed had it
                been a principal  debtor  instead of a guarantor  or by anything
                done or omitted  which but for this  provision  might operate to
                exonerate such security.

5.6     Waiver of Charterer's rights

        Until the Outstanding Indebtedness (which expression,  for the avoidance
        of doubt, includes the Master Swap Agreement Liabilities) has been paid,
        discharged  or  satisfied  in full  (and  notwithstanding  payment  of a
        dividend in any liquidation or under any compromise or arrangement)  and
        notwithstanding  that the  security  created  by this Deed and the other
        Security  Documents may have been realised,  the Charterer  agrees that,
        without the prior written consent of the Mortgagee, it will not:

5.6A    exercise its rights of subrogation,  reimbursement and indemnity against
        the Owner, the other Borrowers or any other person liable;

        5.6.2   demand  or  accept   repayment  in  whole  or  in  part  of  any
                indebtedness  now or  hereafter  due to the  Charterer  from the
                Owner,  the other  Borrowers or from any other person  liable or
                demand or accept  any  Collateral  Instrument  in respect of the
                same or dispose of the same;

        5.6.3   take any step to enforce any right against the Owner,  the other
                Borrowers  or  any  other  person   liable  in  respect  of  any
                Outstanding Indebtedness (which expression, for the avoidance of
                doubt, includes the Master Swap Agreement Liabilities); or

        5.6.4   claim any set-off or counterclaim  against the Owner,  the other
                Borrowers  or any  other  person  liable  or  claim  or prove in
                competition with the Mortgagee  and/or the Secured  Creditors or
                any of them in the liquidation of the Owner, the other Borrowers
                or any other person  liable or have the benefit of, or share in,
                any  payment  from or  composition  with,  the Owner,  the other
                Borrowers  or any other  person  liable or any other  Collateral
                Instrument  now or hereafter  held by the  Mortgagee  and/or the
                Secured   Creditors   or  any  of  them   for  the   Outstanding
                Indebtedness  (which  expression,  for the  avoidance  of doubt,
                includes  the  Master  Swap  Agreement  Liabilities)  or for the
                obligations  or  liabilities  of any other person  liable but so
                that,  if so  directed by the  Mortgagee,  it will prove for the
                whole or any part of its claim in the  liquidation  of the Owner
                on  terms  that  the  benefit  of such  proof  and of all  money
                received by it in respect thereof shall be paid to the Mortgagee
                for  application  in or  towards  discharge  of the  Outstanding
                Indebtedness  (which  expression,  for the  avoidance  of doubt,
                includes the Master Swap Agreement  Liabilities)  in such manner
                as the Mortgagee shall deem appropriate.

5.7     Suspense account

        Any moneys  received in  connection  with this Deed  (whether  before or
        after any Incapacity of the Owner or the Charterer) which would (but for
        this  Deed)  have been  payable  to the  Charterer  may,  if an Event of
        Default has happened, be placed to the credit of a suspense account with
        a view to preserving  the rights of the Mortgagee to prove for the whole
        of its and the Secured  Creditors'  claims against the Owner,  the other
        Borrowers  or any other  person  liable or may be  applied in or towards
        satisfaction of the Outstanding Indebtedness (which expression,  for the
        avoidance of doubt, includes the Master Swap Agreement Liabilities).

5.8     Settlements conditional

        Any  release,  discharge or  settlement  between the  Charterer  and the
        Mortgagee shall be conditional upon no security,  disposition or payment
        to the  Mortgagee  and/or the  Secured  Creditors  or any of them by the
        Owner,  the other  Borrowers or any other person liable being void,  set
        aside  or  ordered  to be  refunded  pursuant  to any  enactment  or law
        relating to bankruptcy, liquidation, administration or insolvency or for
        any other reason whatsoever and if such condition shall not be fulfilled
        the Mortgagee shall be entitled to enforce this Deed  subsequently as if
        such  release,  discharge  or  settlement  had not occurred and any such
        payment had not been made.

5.9     Delivery of certain property

        If,  contrary to the  provisions of this Deed,  the  Charterer  takes or
        receives  the benefit of any  security or receives or recovers any money
        or other property, such security,  money or other property shall be held
        on trust for the Mortgagee  (as security  agent and trustee on behalf of
        the  Secured  Creditors)  and shall be  delivered  to the  Mortgagee  on
        demand.

5.10    Certificates conclusive

        Any  certificate  submitted by the  Mortgagee to the Charterer as to the
        amount or any part  thereof  hereby  secured  shall,  in the  absence of
        manifest error, be conclusive and binding on the Charterer.

5.11    Collateral Instruments

        The  Mortgagee  shall not be  obliged to make any claim or demand on the
        Owner or to  resort  to any  Collateral  Instrument  or  other  means of
        payment now or hereafter  held by or  available  to it before  enforcing
        this Deed and no action taken or omitted by the  Mortgagee in connection
        with any such  Collateral  Instrument  or other  means of payment  shall
        discharge,  reduce,  prejudice  or affect  the  security  created by the
        Charterer  under this Deed nor shall the  Mortgagee  be obliged to apply
        any money or other property  received or recovered in consequence of any
        enforcement or realisation  of any such  Collateral  Instrument or other
        means of payment in reduction of the Outstanding Indebtedness.

6       Charterer's undertakings

6.1     The Charterer hereby covenants with the Mortgagee (as security agent and
        trustee for and on behalf of the Secured  Creditors) and undertakes that
        throughout the Charter Period:

        6.1.1   Notice

                it will from time to time upon the request of the Mortgagee give
                written  notice  (in  such  form  and  to  such  persons  as the
                Mortgagee may reasonably require) of the assignment contained in
                clause 3.1 to any person  from whom any part of the  Charterer's
                Assigned  Property  is or may be due and will  procure  that the
                interest of the Mortgagee in the Insurances shall be endorsed on
                the  instruments  of  insurance  from  time  to time  issued  in
                connection  with the  Insurances as are placed with the Approved
                Brokers  by  reason  of a Notice  of  Assignment  of  Insurances
                (signed by the Charterer, the Owner and by any other assured who
                shall  have  assigned  its  interest  in the  Insurances  to the
                Mortgagee);

        6.1.2   Negative undertakings relating to Charter

                it will not without the prior written  consent of the Mortgagee:

                (a)     Assignments

                        assign or otherwise  dispose of the  Charterer's  rights
                        and  obligations  under the Charter;  and (b) Variations
                        agree to any variation of the Charter;

        6.1.3   Performance of Charter obligations

                it will perform its obligations under the Charter;

        6.1.4   Total Loss recovery

                it will, in the event that,  upon a Total Loss of the Ship,  the
                Mortgagee is disabled from  recovering  under the  Insurances or
                any  of  them  or  the  amount  of the  recovery  thereunder  is
                diminished and such  disablement or diminution  results from any
                breach by the  Charterer  of any of its  obligations  under this
                Deed and/or the  Charter,  pay to the  Mortgagee on demand a sum
                (which shall be applied in accordance with clause 11.1 as if the
                same had been a recovery under the Insurances in respect of such
                Total  Loss)  equal  to the  amount  which  would  but for  such
                disablement  have been  recoverable  under the Insurances or (as
                the case may be) a sum equal to the amount  hereby the insurance
                recovery has been diminished;

        6.1.5   Compliance with Environmental Laws

                it will  comply  with,  and procure  that all its  Environmental
                Affiliates  comply  with,  all  Environmental   Laws  including,
                without  limitation,   requirements   relating  to  manning  and
                establishment  of financial  responsibility  and will obtain and
                comply with, and procure that all its  Environmental  Affiliates
                obtain and comply with, all Environmental Approvals;

        6.1.6   Abandonment

                it will not without the prior  written  consent of the Mortgagee
                (and then only  subject  to any  conditions  the  Mortgagee  may
                impose) abandon the Ship;

        6.1.7   Charterer's Manager

                it will not without the prior  written  consent of the Mortgagee
                (and then only on and subject to such terms as the Mortgagee may
                agree)  appoint a commercial  or  technical  manager of the Ship
                other than the relevant Managers or terminate or amend the terms
                of the relevant Management Agreements to which it is a party;

        6.1.8   Encumbrances

                it will not without the prior  written  consent of the Mortgagee
                (and then only subject to such  conditions  as the Mortgagee may
                impose)  create or purport or agree to create or permit to arise
                or subsist any Encumbrance over or in respect of any part of the
                Charterer's  Assigned Property otherwise than to or in favour of
                the Mortgagee;

        6.1.9   Provision of further information

                provide the Mortgagee with such  financial or other  information
                concerning  the  Charterer  and its affairs as the Mortgagee may
                from time to time require; and

        6.1.10  Notification of certain events

                it will notify the Mortgagee forthwith by facsimile confirmed by
                letter of:

                (a)     any  petition  or  notice of  meeting  to  consider  any
                        resolution  to  wind  up the  Charterer  (or  any  event
                        analogous  thereto  under  the laws of the  place of its
                        incorporation);

                (b)     the occurrence of any Default of which it is aware; or

                (c)     the  occurrence of any  Environmental  Claim against the
                        Charterer,  the Ship,  any other  Relevant  Party or any
                        other   Relevant   Ship  or  any   incident,   event  or
                        circumstances   which   may   give   rise  to  any  such
                        Environmental Claim.

7       Charter Guarantor's undertakings

7.1     General Undertakings

        The Charter  Guarantor hereby agrees and undertakes to the Mortgagee (as
        security  agent and trustee for and on behalf of the Secured  Creditors)
        that it will at all times throughout the Security Period:

        7.1.1   deliver  to the  Mortgagee  sufficient  copies  of  each  of the
                following documents:

                (a)     not later than one hundred  and eighty  (180) days after
                        the end of each  financial  year,  the  audited  balance
                        sheet  and  profit  and  loss  account  of  the  Charter
                        Guarantor and the audited consolidated balance sheet and
                        the  consolidated  profit and loss  account of the Group
                        for such  financial  year and a cash flow  statement for
                        the  Group for such  financial  year  together  with the
                        report of the auditors  thereon,  the notes  thereto and
                        the directors' report thereon, if any;

                (b)     at the time of issue  thereof  every  report,  circular,
                        notice or like document issued by the Charter  Guarantor
                        to its shareholders or creditors generally; and

                (c)     at the  time  of the  delivery  of  the  annual  audited
                        financial  statements,  a  statement  from  the  Charter
                        Guarantor's  auditors stating the respective  amounts of
                        the Net Asset Value, Book Equity, the Total Debt and the
                        Total Market Value Adjusted Assets, in respect of or, as
                        the case may be, as at the end of the financial  year to
                        which such financial  statements  relate  indicating the
                        manner  in  which  the same  have  been  calculated  and
                        whether or not the limits imposed by clauses 72.1, 7.2.4
                        and 7.2.5  have or have not been  exceeded  at such time
                        and so that each such statement shall (in the absence of
                        manifest  error  or in  the  absence  of  the  Mortgagee
                        reaching a  different  determination  pursuant to clause
                        7.2.8) be  conclusive  evidence of such amounts or facts
                        for the purposes of this Deed;

        7.1.2   Provision of further information

                provide the Mortgagee with such  financial or other  information
                concerning  the  Charter   Guarantor  and  its  affairs  as  the
                Mortgagee may from time to time require; and

        7.1.3   comply with its obligations under the Charter Guarantee.

7.2     Financial Undertakings

        The Charter  Guarantor hereby agrees and undertakes to the Mortgagee (as
        security  agent and trustee for and on behalf of the Secured  Creditors)
        that it will at all times throughout the Security Period:

        7.2.1   ensure that:

                (a)     a minimum amount of Twenty million Dollars ($20,000,000)
                        shall  be   standing   to  the  credit  of  the  Charter
                        Guarantor's  Account  for the period  commencing  on the
                        first  Drawdown  Date and ending on 15 December 2006 and
                        thereafter  and  until the  final  date of the  Security
                        Period a minimum  amount of Twenty Five million  Dollars
                        ($25,000,000)  shall be  standing  to the  credit of the
                        Charter  Guarantor's  Account  and  further  ensure that
                        there are no Encumbrances whatsoever existing over or in
                        relation to such minimum amount; and

                (b)     it  maintains  cash  balances of at least Fifty  million
                        Dollars ($50,000,000) in bank accounts in its name or in
                        the name of a member  of the  Group  and  agreed  by the
                        Mortgagee  in  writing  from  time to  time  and for the
                        purposes of this clause  7.2.1(b) the  expression  "bank
                        accounts"  shall  exclude  any bank  accounts  which are
                        subject to an Encumbrance;

        7.2.2   endeavour that any Excess Cash Flow in relation to the Ship will
                be paid into the Charter Guarantor's Account;

        7.2.3   provide details to the Mortgagee at three (3) monthly  intervals
                starting  from the date of this Deed  evidencing  the  operating
                expenses and the Earnings of the Ship;

        7.2.4   ensure that its Net Asset Value at all times exceeds One hundred
                and twenty five million Dollars ($125,000,000); and

        7.2.5   ensure that its Book Equity  shall at all times  exceed  Seventy
                five million Dollars ($75,000,000).

        7.2.6   For the  purpose  of this  clause 7, the  following  expressions
                shall have the following meanings:

                "Applicable  Accounting Principles" means accounting principles,
                concepts,  bases and policies  generally adopted and accepted in
                the United States of America consistently applied;

                "Book  Equity"  means the  aggregate  of the amounts  paid-up or
                credited  as paid-up on the  Charter  Guarantor's  issued  share
                capital and the amount of the  consolidated  capital and revenue
                reserves  of the Group  (including  any share  premium  account,
                capital  redemption  reserve fund and any credit  balance on the
                consolidated  profit and loss account of the Group) all as shown
                by the latest audited  consolidated balance sheet and profit and
                loss account of the Group delivered under this Deed but after:

                (a)     deducting any debit balance on such consolidated  profit
                        and loss account;

                (b)     deducting any amount shown in such consolidated  balance
                        sheet in respect of goodwill (including goodwill arising
                        on consolidation) and other intangible assets;

                (c)     deducting   (so  far  as  not   otherwise   excluded  as
                        attributable  to minority  interests) a sum equal to the
                        aggregate  of the  amount by which the book value of any
                        fixed assets of any member of the Group has been written
                        up after 31 December  2005 (or, in the case of a company
                        becoming a subsidiary after that date, the date on which
                        that company became a subsidiary) by way of revaluation.
                        For the purposes of this  paragraph  (c) any increase in
                        the book  value of any fixed  asset  resulting  from its
                        transfer by one member of the Group to another member of
                        the Group shall be deemed to result from a writing up of
                        its book value by way of revaluation;

                (d)     excluding  amounts set aside for taxation as at the date
                        of such balance sheet and making such adjustments as may
                        be appropriate in respect of any significant  additional
                        taxation  expected to result from  transactions  carried
                        out by any  member of the Group  after such date and not
                        reflected in that balance sheet;

                (e)     deducting all amounts attributable to minority interests
                        in Subsidiaries;

                (f)     making such adjustments as may be appropriate in respect
                        of any  variation  in the  amount  of such paid up share
                        capital  or any  such  reserves  after  the  date of the
                        relevant  balance sheet (but so that no such  adjustment
                        shall be made in respect of any  variation in profit and
                        loss account except to the extent of any profit or loss,
                        calculated  on  a  cumulative  basis,  recorded  in  the
                        consolidated  profit  and  loss  account  of  the  Group
                        delivered to the Mortgagee before the date of this Deed,
                        or under  clause  7.1.1  in  respect  of any  subsequent
                        period);

                (g)     making such adjustments as may be appropriate in respect
                        of any distribution declared, recommended or made by any
                        member  of  the  Group   (otherwise  than   attributable
                        directly or indirectly to the Charter  Guarantor) out of
                        profits  earned  up to and  including  the  date  of the
                        latest audited balance sheet of that member of the Group
                        to the extent that such distribution is not provided for
                        in that balance sheet;

                (h)     making such adjustments as may be appropriate in respect
                        of  any  variation  in  the  interests  of  the  Charter
                        Guarantor  in its  Subsidiaries  since  the  date of the
                        latest published audited  consolidated  balance sheet of
                        the Group;

                (i)     if the  calculation is required for the purpose of or in
                        connection  with a  transaction  under or in  connection
                        with  which  any  company  is to become or cease to be a
                        Subsidiary  of the  Charter  Guarantor,  making all such
                        adjustments as would be appropriate if that  transaction
                        had been carried into effect; and

                (j)     making such  adjustments  as may be  appropriate  in the
                        opinion of the Mortgagee in order that the above amounts
                        are   calculated   in   accordance   with  the  Original
                        Accounting Principles;

                "Earnings"  means  all  earnings  of the Ship  payable  under or
                pursuant  to any  charters  entered  into  by the  Charterer  in
                respect of the employment of the Ship;

                "Encumbrance"  means  any  mortgage,  charge  (whether  fixed or
                floating),   pledge,  lien,  hypothecation,   assignment,  trust
                arrangement  or security  interest or other  encumbrance  of any
                kind  securing  any  obligation  of any  person  or any  type of
                preferential  arrangement  (including  without  limitation title
                transfer and/or retention arrangements having a similar effect);

                "Excess  Cash Flow" means any Earnings of the Ship minus (a) the
                aggregate of the Charter Earnings and (b) the operating expenses
                in relation to the Ship;

                "Finance  Lease"  means  a  lease  treated  as a  finance  lease
                pursuant to the Applicable Accounting Principles.

                "Group"  means,   together,   the  Charter   Guarantor  and  its
                Subsidiaries and "member of the Group" means any of them;

                "Net Asset Value"  means,  at any relevant  time,  the amount in
                Dollars  resulting after deducting the Total Debt from the Total
                Market Value Adjusted Assets, in either case at such time;

                "Original   Accounting   Principles"   means  those   accounting
                principles,  standards  and  practices  which  were  used in the
                preparation of the consolidated  audited financial statements of
                the Group as at 31  December  2005,  and for the year then ended
                and,  to the  extent  that  they  do  not  conflict  with  those
                principles,  standards  and  practices,  such  other  accounting
                principles, standards and practices as were generally acceptable
                in the United States of America on 31 December 2005;

                "Total Debt" means the aggregate principal amount (including any
                fixed or minimum  premium  payable on final  repayment)  of: (a)
                moneys  borrowed  or raised  by the  Charter  Guarantor  and its
                Subsidiaries;   (b)  bonds,   notes,  loan  stock,   debentures,
                commercial paper or other debt securities  issued by the Charter
                Guarantor  or any of its  Subsidiaries  not for the  time  being
                beneficially  owned  by  the  Charter  Guarantor  or  any of its
                Subsidiaries;  (c) sums  outstanding  under  acceptances  by the
                Charter  Guarantor or any of its  Subsidiaries or by any bank or
                acceptance  house under  acceptance  credits opened on behalf of
                the  Charter   Guarantor   or  any   Subsidiary;   (d)  deferred
                indebtedness of the Charter Guarantor or any of its Subsidiaries
                for payment of the acquisition or construction  price for assets
                or services  acquired or constructed;  (e) rental payments under
                Finance Leases;

                (f)     receivables  sold or discounted with a right of recourse
                        to the Charter Guarantor or any of its Subsidiaries;

                (g)     the  nominal  amount  of any  issued  and  paid up share
                        capital   (other  than  equity  share  capital)  of  any
                        Subsidiary  not   beneficially   owned  by  the  Charter
                        Guarantor or another Subsidiary;

                (h)     preference  share capital  redeemable  prior to the last
                        day of the period of the Charter;

                (i)     indebtedness  secured by any Encumbrance over all or any
                        part of the  undertaking,  property,  assets,  rights or
                        revenues  of  the  Charter   Guarantor  or  any  of  its
                        Subsidiaries   irrespective   of  whether  or  not  such
                        indebtedness is supported by a personal  covenant on the
                        part   of   the   Charter   Guarantor   or  any  of  its
                        Subsidiaries;

                (j)     indebtedness  incurred  in  respect  of  swaps,  forward
                        exchange contracts, futures or other derivatives;

                (k)     any other  liability  arising from a transaction  having
                        the  commercial  effect of a borrowing or the raising of
                        money; and

                (l)     obligations   under   guarantees   in   respect  of  the
                        obligations  of any other person  which,  if such person
                        were the Charter  Guarantor or a Subsidiary,  would fall
                        within paragraphs (a) to (k) above,

                PROVIDED THAT:

                (i)     moneys owing by the Charter Guarantor to a Subsidiary or
                        by a Subsidiary  to the Charter  Guarantor or to another
                        Subsidiary shall not be taken into account;

                (ii)    the  principal   amount  of  Total  Debt  deemed  to  be
                        outstanding  in  relation  to  Finance  Leases  or  hire
                        purchase  agreements  shall be the present  value of the
                        minimum  lease  or  hire  payments   discounted  at  the
                        interest  rate  implicit in the  relevant  lease or hire
                        purchase agreement; and

                "Total Market Value Adjusted Assets" means the aggregate of:

                (a)     the value (less depreciation computed in accordance with
                        generally accepted  international  accounting principles
                        consistently  applied)  on a  consolidated  basis of all
                        tangible  fixed  assets of the  Group,  as stated in the
                        relevant consolidated financial statements of the Group,
                        but  excluding  any ships at the relevant  time owned by
                        members of the Group  which,  for the  purposes  of such
                        consolidated  financial statements,  are included in the
                        consolidated tangible fixed assets of the Group (for the
                        purposes of clauses 7.2 and 7.3, the "Relevant  Ships");
                        and

                (b)     the aggregate of the market value of the Relevant Ships,
                        as such  market  value  shall  have been  most  recently
                        determined (as of the date of the relevant  calculation)
                        pursuant to the provisions of clause 7.3 of this Deed by
                        means  of  valuations   obtained  by  the  Mortgagee  in
                        accordance  with the  provisions  of clause  7.3 of this
                        Deed (and not the value of the Relevant  Ships as stated
                        in the relevant consolidated financial statements of the
                        Group).

        7.2.7   All the terms  defined in this  clause 7.2 and used in this Deed
                are to be determined on a  consolidated  basis in respect of the
                Group and (except as items are expressly included or excluded in
                the  relevant  definition  or  clause)  are  used  and  shall be
                construed in accordance  with Applicable  Accounting  Principles
                and  as  determined  from  the  latest  consolidated   financial
                statements of the Group  delivered to the Mortgagee  pursuant to
                clause 7.1.1.

        7.2.8   The  compliance of the Charter  Guarantor with the covenants set
                out in clauses 7.2.1, 7.2.4 and 7.2.5 shall be determined on the
                basis  of  calculations  made by the  Mortgagee  at any  time by
                reference to then latest  consolidated  financial  statements of
                the Group  delivered to the Mortgagee  pursuant to clause 7.1.1.
                For the  avoidance  of  doubt,  it is  hereby  agreed  that  the
                Mortgagee shall be entitled to make such  determinations  and/or
                calculations  at any time when, and in relation to any period in
                relation  to which,  the Charter  Guarantor  shall be obliged to
                comply with each of the  covenants out in clauses  7.2.1,  7.2.4
                and 7.2.5 without regard to when any such  financial  statements
                are due to be delivered or have been  actually  delivered to the
                Mortgagee pursuant to clause 7.1.

        7.2.9   For the purposes of this clause 7.2:

                (a)     no item shall be deducted or credited  more than once in
                        any calculation; and

                (b)     any amount  expressed  in a currency  other than Dollars
                        shall be  converted  into  Dollars  in  accordance  with
                        Applicable Accounting Principles.

7.3     Valuation of Relevant Ships

        7.3.1   Valuations

                Each of the  Relevant  Ships  shall,  for the  purposes  of this
                clause 7, be valued in Dollars as and when the  Mortgagee  shall
                require. Each such valuation of a Relevant Ship shall be made by
                an independent  firm of shipbrokers  appointed by the Mortgagee.
                Such  valuation  shall be made without,  unless  required by the
                Mortgagee,  physical inspection,  and on the basis of a sale for
                prompt delivery for cash at arm's length,  on normal  commercial
                terms as  between a  willing  buyer  and a  willing  seller  and
                without taking into account the benefit of any  charterparty  or
                other employment of such Relevant Ship. The value of each of the
                Relevant Ships  determined in accordance  with the provisions of
                this clause 7.3 shall be binding upon the parties hereto for the
                purposes of calculating  the Total Market Value Adjusted  Assets
                until  such  time  as  any  further  such  valuations  shall  be
                obtained.

        7.3.2   Information

                The Charter  Guarantor  undertakes to the Mortgagee to supply to
                the  Mortgagee  and  to any  such  shipbroker  such  information
                concerning   any  Relevant   Ship  and  its  condition  as  such
                shipbrokers may reasonably require for the purpose of making any
                such valuation.

        7.3.3   Costs

                All  costs  in  connection  with  the  Mortgagee  obtaining  any
                valuation  of each of the Relevant  Ships  referred to in clause
                7.3.1 shall be borne by the Owner.

8       Covenants concerning insurance and operational matters

8.1     Covenants

        The Charterer hereby covenants with the Mortgagee (as security agent and
        trustee  for and on  behalf of the  Secured  Creditors)  and  undertakes
        throughout the Charter Period:

        8.1.1   Insurance

                (a)     Insured risks,  amounts and terms to insure and keep the
                        Ship insured  free of cost and expense to the  Mortgagee
                        and  in the  joint  names  only  of the  Owner  and  the
                        Charterer  or, if so required by the  Mortgagee,  in the
                        joint  names  of  the  Owner,   the  Mortgagee  and  the
                        Charterer  (but  without  liability  on the  part of the
                        Mortgagee for premiums or calls):

                        (i)     against fire and usual  marine risks  (including
                                excess risks) and war risks,  on an agreed value
                                basis,  in such  amounts  and upon such terms as
                                shall  from  time to time be  acceptable  to the
                                Mortgagee.  For  the  avoidance  of  doubt,  the
                                Charterer  hereby  covenants  with the Mortgagee
                                and undertakes throughout the Security Period to
                                ensure  that the Ship  will be  insured  for not
                                less than the greater of:

                                (A)     the value of the Ship for the time being
                                        (as  most  recently  determined  by  the
                                        Agent  pursuant  to clause  8.2.2 of the
                                        Loan Agreement); and

                                (B)     such  amount  as will,  when  aggregated
                                        with  the  amounts  of  the   equivalent
                                        insurance  of  the  Other  Ships,  be at
                                        least  equal to one  hundred  and thirty
                                        per cent (130%) of the  aggregate of the
                                        (aa) Loan and (bb) the Swap Exposure (as
                                        such  expression  is defined in the Loan
                                        Agreement);

                        (ii)    and upon such terms as should  from time to time
                                be approved in writing by the Mortgagee;

                       (iii)    against    protection   and   indemnity    risks
                                (including   pollution  risks  for  the  highest
                                amount  in  respect  of  which  cover  is or may
                                become  available  for  ships of the same  type,
                                size,  age and flag as the  Ship and a  freight,
                                demurrage and defence  cover) for the full value
                                and tonnage of the Ship (as  approved in writing
                                by the  Mortgagee)  and upon such terms as shall
                                from time to time be  approved in writing by the
                                Mortgagee; and

                        (iv)    in respect of such other  matters of  whatsoever
                                nature and howsoever arising in respect of which
                                insurance would be maintained by a prudent owner
                                of the Ship.

                        and to pay to the  Mortgagee  the cost (as  conclusively
                        certified  by  the  Mortgagee)  of (A)  any  mortgagee's
                        interest insurance (including, if the Mortgagee shall so
                        require,  mortgagee's  additional perils (all P&I risks)
                        coverage)  which  the  Mortgagee  may from  time to time
                        effect in  respect  of the Ship upon such  terms in such
                        amounts  as it shall  deem  desirable  and (B) any other
                        insurance  cover  which the  Mortgagee  may from time to
                        time  effect in respect of the Ship and/or in respect of
                        its  interest  or  potential  third party  liability  as
                        mortgagee  of the  Ship  as  the  Mortgagee  shall  deem
                        desirable having regard to any limitations in respect of
                        amount or extent of cover which may from time to time be
                        applicable to any of the other insurances referred to in
                        this clause 8.1.1(a);

                (b)     Approved brokers, insurers and associations

                        to effect the  insurances  aforesaid in such currency as
                        the  Mortgagee  may approve  and  through  the  Approved
                        Brokers  (other  than  the  said  mortgagee's   interest
                        insurance  which  shall  be  effected   through  brokers
                        nominated  by the  Mortgagee)  and with  such  insurance
                        companies and/or underwriters as shall from time to time
                        be  approved  in  writing  by  the  Mortgagee;  provided
                        however  that  the  insurances  against  war  risks  and
                        protection  and  indemnity  risks may be effected by the
                        entry of the Ship with such war risks and protection and
                        indemnity  associations  as shall  from  time to time be
                        approved in writing by the  Mortgagee;

                (c)     Fleet liens, set-off and cancellation

                        if any of the insurances  referred to in clause 8.1.1(a)
                        form part of a fleet cover, to procure that the Approved
                        Brokers shall undertake to the Mortgagee that they shall
                        neither  set off  against  any  claims in respect of the
                        Ship any premiums due in respect of other  vessels under
                        such  fleet  cover  or  any   premiums   due  for  other
                        insurances,  nor  cancel  the  insurance  for  reason of
                        non-payment  of premiums  for other  vessels  under such
                        fleet  cover or of premiums  for such other  insurances,
                        and  shall  undertake  to  issue a  separate  policy  in
                        respect  of the  Ship if and  when so  requested  by the
                        Mortgagee;  (d) Payment of premiums and calls punctually
                        to pay all premiums, calls,  contributions or other sums
                        payable in respect of all such insurances and to produce
                        all relevant  receipts or other evidence of payment when
                        so required by the Mortgagee;

                (e)     Renewal

                        at least 14 days before the relevant policies, contracts
                        or entries expire,  to notify the Mortgagee of the names
                        of the brokers  and/or the war risks and  protection and
                        indemnity  associations  proposed  to be employed by the
                        Charterer  or any other  party for the  purposes  of the
                        renewal of such  insurances  and of the amounts in which
                        such insurances are proposed to be renewed and the risks
                        to be  covered  and,  subject  to  compliance  with  any
                        requirements  of the  Mortgagee  pursuant to this clause
                        8.1.1, to procure that appropriate  instructions for the
                        renewal of such insurances on the terms so specified are
                        given to the Approved Brokers and/or to the approved war
                        risks and protection and indemnity associations at least
                        10 days  before  the  relevant  policies,  contracts  or
                        entries expire, and that the Approved Brokers and/or the
                        approved  war  risks  and   protection   and   indemnity
                        associations will at least 7 days before such expiry (or
                        within such  shorter  period as the  Mortgagee  may from
                        time to time agree)  confirm in writing to the Mortgagee
                        as  and  when  such   renewals  have  been  effected  in
                        accordance   with  the   instructions   so  given;

                (f)     Guarantees

                        to  arrange  for  the  execution  and  delivery  of such
                        guarantees  or  indemnities  as may from time to time be
                        required by any  protection  and  indemnity or war risks
                        association;

                (g)     Hull policy documents, notices, loss payable clauses and
                        brokers'  undertakings  to  deposit  with  the  Approved
                        Brokers (or  procure  the  deposit of) all slips,  cover
                        notes,   policies,   certificates   of  entry  or  other
                        instruments  of  insurance  from time to time  issued in
                        connection  with such of the  insurances  referred to in
                        clause  8.1.1(a) as are  effected  through the  Approved
                        Brokers and procure that the  interest of the  Mortgagee
                        shall  be  endorsed  thereon  by  incorporation  of  the
                        relevant Loss Payable  Clause and,  where the Insurances
                        have  been  assigned  to the  Mortgagee,  by  means of a
                        Notice of Assignment of Insurances  (signed by the Owner
                        and the  Charterer  and by any other  assured  who shall
                        have  assigned  its  interest in the  Insurances  to the
                        Mortgagee)  and that the  Mortgagee  shall be  furnished
                        with pro forma copies thereof and a letter or letters of
                        undertaking  from the  Approved  Brokers in such form as
                        shall from time to time be  required  by the  Mortgagee;


                (h)     Associations'  loss payable  clauses,  undertakings  and
                        certificates

                        to procure that any protection and indemnity  and/or war
                        risks  associations  in  which  the Ship is for the time
                        being  entered  shall  endorse the relevant Loss Payable
                        Clause on the  relevant  certificate  of entry or policy
                        and  shall  furnish  the  Mortgagee  with a copy of such
                        certificate  of entry or policy  and a letter or letters
                        of  undertaking  in such form as shall from time to time
                        be  required by the  Mortgagee;

                (i)     Extent of cover and exclusions

                        to  take  all  necessary  action  and  comply  with  all
                        requirements  which may from time to time be  applicable
                        to the Insurances  (including,  without limitation,  the
                        making  of  all   requisite   declarations   within  any
                        prescribed time limits and the payment of any additional
                        premiums or calls) so as to ensure  that the  Insurances
                        are not made subject to any exclusions or qualifications
                        to which the  Mortgagee  has not given its prior written
                        consent  and  are  otherwise  maintained  on  terms  and
                        conditions  from time to time approved in writing by the
                        Mortgagee;

                (j)     Correspondence with brokers and associations

                        to  provide to the  Mortgagee,  at the time of each such
                        communication,  copies  of  all  written  communications
                        between  the  Charterer  and the  Approved  Brokers  and
                        approved  war  risks  and   protection   and   indemnity
                        associations    which   relate   to   compliance    with
                        requirements   from  time  to  time  applicable  to  the
                        Insurances including,  without limitation, all requisite
                        declarations  and  payments  of  additional  premiums or
                        calls referred to in clause 8.1.1(i);

                (k)     Collection of claims

                        to do all things  necessary  and provide all  documents,
                        evidence  and  information  to enable the  Mortgagee  to
                        collect or recover  any moneys  which  shall at any time
                        become due in respect of the Insurances;

                (l)     Employment of Ship

                        not to employ the Ship or suffer the Ship to be employed
                        otherwise  than in  conformity  with  the  terms  of the
                        Insurances  (including any warranties express or implied
                        therein)  without  first  obtaining  the  consent of the
                        insurers  to such  employment  and  complying  with such
                        requirements  as to extra  premium or  otherwise  as the
                        insurers may prescribe; and

                (m)     Application of recoveries

                        to apply all sums receivable  under the Insurances which
                        are  paid to it in  accordance  with  the  Loss  Payable
                        Clauses in repairing  all damage  and/or in  discharging
                        the  liability  in respect of which such sums shall have
                        been received;

        8.1.2   Ship's registration

                not to do or suffer to be done anything,  or omit to do anything
                the  doing or  omission  of which  could or might  result in the
                registration  of the Ship as a Cyprus  ship being  forfeited  or
                imperilled  or which  could or might  result  in the Ship  being
                required to be  registered  under any other flag than the Cyprus
                flag and not to  register  the Ship or permit  its  registration
                under any other flag  without the prior  written  consent of the
                Mortgagee;

        8.1.3   Repair

                to keep the Ship in a good and  efficient  state of  repair  and
                procure that all repairs to or replacement of any damaged,  worn
                or lost parts or equipment  are effected in such manner (both as
                regards workmanship and quality of materials) as not to diminish
                the value of the Ship;

        8.1.4   Modification; removal of parts; equipment owned by third parties

                not without the prior  written  consent of the  Mortgagee to, or
                suffer any other person to:

                (a)     make  any  modification  to the Ship in  consequence  of
                        which her structure, type or performance characteristics
                        could  or  might  be  materially  altered  or her  value
                        materially reduced; or

                (b)     remove any  material  part of the Ship or any  equipment
                        the  value of which is such  that its  removal  from the
                        Ship  would  materially  reduce  the  value  of the Ship
                        without  replacing  the same  with  equivalent  parts or
                        equipment  which  are  owned  by  the  Owner  free  from
                        Encumbrances; or

                (c)     install on the Ship any equipment owned by a third party
                        which cannot be removed  without  causing  damage to the
                        structure or fabric of the Ship;

        8.1.5   Maintenance of class; compliance with regulations

                to maintain the relevant  Classification (as defined in the Loan
                Agreement)  as the  class  of the Ship  and to  comply  with and
                ensure that the Ship at all times  complies with the  provisions
                of the Cyprus  Merchant  Shipping Acts and all  regulations  and
                requirements   (statutory  or  otherwise)   from  time  to  time
                applicable to vessels  registered under the laws and flag of the
                relevant  Flag  State  (as  defined  in the Loan  Agreement)  or
                otherwise applicable to the Ship;

        8.1.6   Surveys

                to submit the Ship to continuous  surveys and such periodical or
                other surveys as may be required for classification purposes and
                to supply to the Mortgagee  copies of all survey  reports issued
                in respect thereof;

        8.1.7   Inspection

                to ensure that the  Mortgagee,  by  surveyors  or other  persons
                appointed  by it for such  purpose,  may  board  the Ship at all
                reasonable times for the purpose of inspecting her and to afford
                all proper  facilities for such inspections and for this purpose
                to give the Mortgagee  reasonable advance notice of any intended
                drydocking   of  the   Ship   (whether   for  the   purpose   of
                classification, survey or otherwise);

        8.1.8   Prevention of and release from arrest

                promptly to pay and  discharge all debts,  damages,  liabilities
                and  outgoings  whatsoever  which have given or may give rise to
                maritime,   statutory   or   possessory   liens  on,  or  claims
                enforceable  against,  the  Ship,  her  Insurances  or any  part
                thereof and, in the event of a writ or libel being filed against
                the Ship, her  Insurances or any part thereof,  or of any of the
                same being  arrested,  attached or levied upon pursuant to legal
                process or purported  legal process or in the event of detention
                of the Ship in exercise or  purported  exercise of any such lien
                or claim as aforesaid,  to procure the release of the Ship,  her
                Insurances from such arrest, detention attachment or levy or, as
                the case may be, the  discharge  of the writ or libel  forthwith
                upon receiving notice thereof by providing bail or procuring the
                provision  of security or  otherwise  as the  circumstances  may
                require;

        8.1.9   Employment

                not to employ the Ship or permit her  employment  in any manner,
                trade or business  which is forbidden by Cyprus law, or which is
                unlawful or illicit under the law of any relevant  jurisdiction,
                or in carrying  illicit or  prohibited  goods,  or in any manner
                whatsoever  which may  render her  liable to  condemnation  in a
                prize court, or to destruction,  seizure, confiscation,  penalty
                or sanctions and, in the event of hostilities in any part of the
                world  (whether war be declared or not),  not to employ the Ship
                or permit her  employment in carrying any contraband  goods,  or
                enter or trade to or to  continue to trade in any zone which has
                been  declared  a war zone by any  Government  Entity  or by the
                Ship's war risks  insurers  unless the prior written  consent of
                the  Mortgagee is obtained and such special  insurance  cover as
                the  Mortgagee  may  require  shall  have been  effected  by the
                Charterer and at the expense of the Charterer;

        8.1.10  Information

                promptly to furnish the Mortgagee  with all such  information as
                it may  from  time to  time  require  regarding  the  Ship,  her
                employment, position and engagements, particulars of all towages
                and salvages, and copies of all charters and other contracts for
                her employment, or otherwise howsoever concerning it;

        8.1.11  Notification of certain events

                to  notify  the  Mortgagee  forthwith  by  facsimile  thereafter
                confirmed by letter of:

        (a)     any damage to the Ship requiring  repairs the cost of which will
                or might exceed the Casualty Amount;

        (b)     any  occurrence  in  consequence  of  which  the Ship has or may
                become a Total Loss; (c) any requisition of the Ship for hire;

        (d)     any  requirement  or  recommendation  made by any insurer or the
                relevant   Classification   Society  (as  defined  in  the  Loan
                Agreement) or by any competent authority which is not, or cannot
                be, complied with in accordance with its terms; or

        (e)     any arrest or detention of the Ship or any exercise or purported
                exercise of a lien or other claim on the Ship or the  Insurances
                or any part thereof;

        (f)     any petition or notice of meeting to consider any  resolution to
                wind-up the Charterer (or any event analogous  thereto under the
                laws of the place of its incorporation); or

        (g)     the  occurrence of any Default;

        8.1.12  Payment of outgoings and evidence of payments

                promptly to pay all tolls,  dues and other outgoings  whatsoever
                in  respect of the Ship and the  Ship's  Insurances  and to keep
                proper  books of account in respect of the Ship and, as and when
                the Mortgagee may so require,  to make such books  available for
                inspection   on  behalf  of  the   Mortgagee,   and  to  furnish
                satisfactory  evidence  that the  wages and  allotments  and the
                insurance and pension  contributions  of the Master and crew are
                being promptly and regularly  paid and that all deductions  from
                crew's  wages in respect of any  applicable  tax  liability  are
                being  properly  accounted  for and that the Master has no claim
                for  disbursements  other  than  those  incurred  by  him in the
                ordinary course of trading on the voyage then in progress;

        8.1.13  Repairers' liens

                not without the prior  written  consent of the  Mortgagee to put
                the Ship into the  possession  of any person for the  purpose of
                work  being  done upon her in an amount  exceeding  or likely to
                exceed the  Casualty.Amount  unless such person shall first have
                given to the  Mortgagee in terms  satisfactory  to it, a written
                undertaking not to exercise any lien on the Ship for the cost of
                such work or otherwise;

        8.1.14  Chartering

                save for any charter disclosed by the Charterer to the Mortgagee
                in writing and agreed by the  Mortgagee  in  writing,  in either
                case  prior to the date of this  Deed,  not  without  the  prior
                written consent of the Mortgagee (which the Mortgagee shall have
                full  liberty to withhold)  and, if such consent is given,  only
                subject to such  conditions as the Mortgagee may impose,  to let
                the Ship: (a) on demise charter for any period;  (b) by any time
                or consecutive  voyage charter for a term which exceeds or which
                by virtue of any optional  extensions  therein  contained  might
                exceed twelve (12) months'  duration;  (c) on terms whereby more
                than two (2)  months'  hire (or the  equivalent)  is  payable in
                advance;  or (d) below the market  rate  prevailing  at the time
                when the Ship is fixed or other than on arms' length terms;

        8.1.15  Sharing of Earnings

                not without the prior written consent of the Mortgagee (and then
                only subject to such  conditions as the Mortgagee may impose) to
                enter into any agreement or arrangement whereby the Earnings may
                be shared with any other person;

        8.1.16  Manager

                not  without  the prior  written  consent  of the  Mortgagee  to
                appoint a manager of the Ship other than the Commercial  Manager
                (as such term is defined in the Loan Agreement), or terminate or
                amend the terms of the Vanguard Commercial  Management Agreement
                (as such term is defined in the Loan Agreement);

        8.1.17  Notice of Mortgage

                to place  and at all  times  and  places  to  retain a  properly
                certified  copy of the  Mortgage  (which  shall form part of the
                Ship's  documents)  on board the Ship with her  papers and cause
                such  certified  copy of the Mortgage to be exhibited to any and
                all persons having  business with the Ship which might create or
                imply any commitment or encumbrance  whatsoever on or in respect
                of the Ship (other than a lien for crew's wages and salvage) and
                to any  representative  of the  Mortgagee  and to place and keep
                prominently displayed in the navigation room and in the Master's
                cabin of the Ship a framed  printed notice in plain type reading
                as follows:

                              "NOTICE OF MORTGAGE"

                This Ship is subject to a first  priority  mortgage in favour of
                FORTIS  BANK   (NEDERLAND)   N.V.  of  Coolsingel  93,  3012  AE
                Rotterdam, The Netherlands. Under the said mortgage, neither the
                Owner  nor any  charterer  nor the  Master  of this Ship has any
                right,  power or  authority  to  create,  incur or  permit to be
                imposed  upon  this  Ship  any   commitments   or   encumbrances
                whatsoever other than for crew's wages and salvage" and in terms
                of the said notice it is hereby  agreed that save and subject as
                otherwise herein  provided,  neither the Owner nor the Charterer
                nor any other charterer nor the Master of the Ship nor any other
                person has any right,  power or  authority  to create,  incur or
                permit to be  imposed  upon the Ship any lien  whatsoever  other
                than for crew's wages and salvage;

        8.1.18  Anti-drug abuse

                without  prejudice to clause  8.1.9,  to take all  necessary and
                proper precautions to prevent any infringements of the Anti-Drug
                Abuse Act of 1986 of the United States of America or any similar
                legislation  applicable to the Ship in any jurisdiction in or to
                which the Ship  shall be  employed  or located or trade or which
                may  otherwise be applicable to the Ship and/or the Owner and/or
                the Charterer and, if the Mortgagee  shall so require,  to enter
                into a "Carrier  Initiative  Agreement"  with the United  States
                Customs  and  Border  Protection  and to  procure  that the same
                agreement (or any similar agreement hereafter  introduced by any
                Government Entity of the United States of America) is maintained
                in full force and effect and performed by the Charterer;

        8.1.19  Compliance with environmental laws

                to comply with, and procure that all Environmental Affiliates of
                the Charterer  comply with, all  Environmental  Laws  including,
                without limitation,  requirements relating to manning submission
                of oil response plans, designations of qualified individuals and
                establishment  of  financial  responsibility  and to obtain  and
                comply with,  and procure that all  Environmental  Affiliates of
                the  Charterer   obtain  and  comply  with,  all   Environmental
                Approvals;

        8.1.20  Compliance with Code

                comply and will procure  that any Operator  will comply with and
                ensure  that the  Ship and any  Operator  will  comply  with the
                requirements  of the Code,  including  (but not  limited to) the
                maintenance and renewal of valid  certificates  pursuant thereto
                throughout the Security Period;

        8.1.21  Withdrawal of DOC and SMC

                procure that any Operator will, immediately inform the Mortgagee
                if there is any  threatened  or actual  withdrawal of its DOC or
                the SMC in respect of the Ship;

        8.1.22  Issuance of DOC and SMC

                procure that any Operator  will,  promptly  inform the Mortgagee
                upon the issue to the Owner or any  Operator of a DOC and to the
                Ship of an SMC or the  receipt by the Owner or any  Operator  of
                notification that its application for the same has been refused;
                and

        8.1.23  ISPS Code compliance

                (and procure that any Operator of the Ship will):

                (a)     maintain  at all  times  a  valid  and  current  ISSC in
                        respect of the Ship;

                (b)     immediately  notify  the  Mortgagee  in  writing  of any
                        actual    or    threatened    withdrawal,    suspension,
                        cancellation  or  modification of the ISSC in respect of
                        the Ship; and

                (c)     procure  that the Ship will comply at all times with the
                        ISPS Code.

8.2     Substitute  performance of Mortgage

        To the extent that,  pursuant to the Charter or this Deed, the Charterer
        duly performs and discharges (or procures the  performance and discharge
        of) the duties and liabilities undertaking by the Owner in the Mortgage,
        then such  performance  and discharge of the said duties and liabilities
        by the Charterer  shall, to that extent,  be deemed to be proper and due
        performance  and discharge of the Owner's duties and  liabilities  under
        the Mortgage.

9       Powers of Mortgagee to protect security and remedy defaults

9.1     Protective action

        The  Mortgagee  (as security  agent and trustee on behalf of the Secured
        Creditors)  shall,  without  prejudice to its other  rights,  powers and
        remedies  under any of the  Security  Documents,  be  entitled  (but not
        bound) at any time,  and as often as may be necessary,  to take any such
        action  as it may  in its  discretion  think  fit  for  the  purpose  of
        protecting  or  maintaining  the  security  created by this Deed and the
        other Security Documents, and all Expenses attributable thereto shall be
        payable by the Owner on demand.

9.2     Remedy of defaults

        Without prejudice to the generality of the provisions of clause 9.1:

        9.2.1   if the Charterer  fails to comply with any of the  provisions of
                clause 8.1.1 the Mortgagee  shall be entitled (but not bound) to
                effect and thereafter to maintain all such  insurances  upon the
                Ship as in its  discretion  it may think fit in order to procure
                the compliance with such provisions or alternatively, to require
                the Ship (at the  Charterer's  risk) to remain in, or to proceed
                to and remain in a port  designated by the Mortgagee  until such
                provisions are fully complied with;

        9.2.2   if the Charterer  fails to comply with any of the  provisions of
                clauses 8.1.3,  8.1.5 or 8.1.6,  the Mortgagee shall be entitled
                (but not bound) to arrange for the carrying out of such repairs,
                changes or  surveys as it may deem  expedient  or  necessary  in
                order to procure the compliance with such provisions; and

        9.2.3   if the Charterer  fails to comply with any of the  provisions of
                clause 8.1.8, the Mortgagee shall be entitled (but not bound) to
                pay and  discharge  all such  debts,  damages,  liabilities  and
                outgoings  as are  therein  mentioned  and/or  to take  any such
                measures as it may deem  expedient or necessary  for the purpose
                of  securing  the  release of the Ship in order to  procure  the
                compliance with such provisions,  and the Expenses  attributable
                to the  exercise by the  Mortgagee  of any such powers  shall be
                payable by the Owner to the Mortgagee on demand.

10      Powers of Mortgagee on Event of Default

10.1    Powers

        Upon the  happening of any Event of Default  which has not been remedied
        or  expressly  waived in writing by the  Creditors,  the  Mortgagee  (as
        security  agent and trustee for and on behalf of the Secured  Creditors)
        shall  become  forthwith  entitled by notice  given to the  Borrowers in
        accordance  with the provisions of clause 10.2 of the Loan Agreement or,
        as regards the Master Swap  Agreement,  in accordance  with the relevant
        terms  of  the  Master  Swap  Agreement,   to  declare  the  Outstanding
        Indebtedness (which expression, for the avoidance of doubt, includes the
        Master Swap Agreement  Liabilities) to be due and payable immediately or
        in accordance with such notice,  whereupon the Outstanding  Indebtedness
        (which expression,  for the avoidance of doubt, includes the Master Swap
        Agreement  Liabilities)  shall become so due and payable and (whether or
        not the Mortgagee  shall have given any such notice) the Mortgagee shall
        become forthwith entitled, as and when it may see fit, to put into force
        and  exercise in relation to the Owner's  Assigned  Property  and/or the
        Charterer's  Assigned  Property  or any part  thereof  all or any of the
        rights, powers and remedies possessed by it as mortgagee and/or assignee
        of  the  Owner's  Assigned  Property  and/or  the  Charterer's  Assigned
        Property  (whether  at law, by virtue of the  Mortgage  and this Deed or
        otherwise)  and in particular  (without  limiting the  generality of the
        foregoing):

        10.1.1  to require that all policies,  contracts,  certificates of entry
                and other records relating to the Insurances  (including details
                of  and  correspondence   concerning   outstanding   claims)  be
                delivered  forthwith to such  adjusters  and/or  brokers  and/or
                other insurers as the Mortgagee may nominate;

        10.1.2  to collect,  recover,  compromise and give a good discharge for,
                all claims then  outstanding  or  thereafter  arising  under the
                Insurances or any of them or in respect of any other part of the
                Owner's  Assigned  Property  and/or  the  Charterer's   Assigned
                Property,  and to take over or institute (if necessary using the
                name of the  Owner or, as the case may be,  the  Charterer)  all
                such proceedings in connection therewith as the Mortgagee in its
                absolute  discretion  thinks  fit,  and,  in  the  case  of  the
                Insurances,  to permit the brokers  through whom  collection  or
                recovery is effected to charge the usual brokerage therefore;

        10.1.3  to discharge,  compound, release or compromise claims in respect
                of the Ship or any other part of the Owner's  Assigned  Property
                and/or the Charterer's Assigned Property which have given or may
                give rise to any  charge  or lien or other  claim on the Ship or
                any other  part of the  Owner's  Assigned  Property  and/or  the
                Charterer's Assigned Property or which are or may be enforceable
                by proceedings against the Ship or any other part of the Owner's
                Assigned Property and/or the Charterer's Assigned Property; and

        10.1.4  to recover  from the Owner on demand all  Expenses  incurred  or
                paid by the  Mortgagee  in  connection  with the exercise of the
                powers (or any of them) referred to in this clause 10.1.

10.2    Liability of Mortgagee

        The Mortgagee  shall not be liable as mortgagee in possession in respect
        of all or any of the Owner's  Assigned  Property  and/or the Charterer's
        Assigned  Property to account or be liable for any loss upon realisation
        or for any  neglect or default of any nature  whatsoever  in  connection
        therewith for which a mortgagee in possession may be liable as such.

11      Application of moneys

11.1    Application

        All moneys  received by the Mortgagee (as security agent and trustee for
        and on behalf of the Secured Creditors) in respect of:

        11.1.1  recovery  under the  Insurances  (other  than  under any loss of
                earnings  insurance  and any such  sum or sums as may have  been
                received by the Mortgagee (as security agent and trustee for and
                on behalf  of the  Secured  Creditors)  in  accordance  with the
                relevant Loss Payable  Clause in respect of a major  casualty as
                therein  defined and paid over to the  Charterer  as provided in
                clause 3.1.2 or which fall to be otherwise  applied under clause
                11.3);

        11.1.2  Requisition Compensation; and

        11.1.3  the Owner's Assigned Property, shall be held by it upon trust in
                the first place to pay or make good the Expenses and the balance
                shall:

                (a)     in the case of moneys received in respect of sale of the
                        Ship or recovery  under the  Insurances in relation to a
                        Total Loss of the Ship or her Requisition Compensation:

                        (i)     if no Default has occurred and is continuing, be
                                applied in making such prepayment as is required
                                in  accordance  with  clause  4.3  of  the  Loan
                                Agreement   and  in  or  towards  any   payments
                                required  pursuant  to  clause  4.4 of the  Loan
                                Agreement and the balance, if any, shall be paid
                                to the Owner; or

                        (ii)    if a Default has occurred and is continuing  but
                                no Event of Default has occurred, be retained by
                                the  Mortgagee on a suspense  account until such
                                time as such  Default is  remedied  and no other
                                Default   has   occurred   and   is   continuing
                                (whereupon  such  moneys  shall  be  applied  in
                                accordance with clause 4.3 of the Loan Agreement
                                and in or towards any payments required pursuant
                                to  clause  4.4 of the Loan  Agreement)  and the
                                balance,  if any,  shall  be  paid to the  Owner
                                provided that,  until applied in accordance with
                                clause  4.3  of  the  Loan  Agreement  and in or
                                towards any payments required pursuant to clause
                                4.4 of  the  Loan  Agreement  or  paragraph  (b)
                                below,  moneys so  retained  shall be applied by
                                the Mortgagee in or towards  satisfaction of any
                                sums from time to time  accruing due and payable
                                by the Owner under the Security Documents or any
                                of them by virtue of payment demanded thereunder
                                in  each  case  as  the  Mortgagee  may  in  its
                                absolute discretion determine; and

                (b)     in any case,  if an Event of Default  has  occurred  and
                        which  has not been  remedied  or  expressly  waived  in
                        writing by the Creditors, be applied by the Mortgagee in
                        the  manner   specified  in  clause  13.1  of  the  Loan
                        Agreement  and/or  (at the  absolute  discretion  of the
                        Mortgagee) in accordance with sub-clause (a)(ii) above,

                and the  surplus  (if  any)  shall  be paid  to the  Owner,  the
                Charterer  or such  other  person  as may for the time  being be
                entitled thereto.

11.2    Shortfalls

        In the event that the balance referred to in clause 11.1 is insufficient
        to pay in full the whole of the Outstanding Indebtedness,  the Mortgagee
        shall be entitled to collect the  shortfall  from the Owner or any other
        person liable for the time being therefore.

11.3    Application of Insurances received by Mortgagee

        Any moneys received by the Mortgagee in respect of the Insurances (other
        than in respect of recovery  under any loss of earnings  insurance or in
        respect of a Total Loss) pursuant to the Mortgage and/or the assignments
        by the Charterer contained in clause 3.1 shall:

        11.3.1  if received by the  Mortgagee,  or in the hands of the Mortgagee
                after the occurrence of a Default but prior to the occurrence of
                an Event of Default,  be retained by the  Mortgagee and shall be
                paid over by the Mortgagee to the Charterer  (during the Charter
                Period) at such times,  in such  amounts  and for such  purposes
                and/or  shall  be  applied  by  the   Mortgagee  in  or  towards
                satisfaction  of any sums  from  time to time  accruing  due and
                payable by the Owner or the other  Borrowers  under the Security
                Documents  or any of  them  or by  virtue  of  payment  demanded
                thereunder,  in each  case  the  Mortgagee  may in its  absolute
                discretion determine; and

        11.3.2  if received by the Mortgagee,  or in the hands of the Mortgagee,
                after the  occurrence of an Event of Default,  be applied by the
                Mortgagee in the manner  specified  in clause 111 and/or  clause
                11.3, as the Mortgagee may in its absolute discretion determine.

12      Remedies cumulative and other provisions

12.1    No implied waivers; remedies cumulative

        No failure  or delay on the part of the  Mortgagee  and/or  the  Secured
        Creditors or any of them to exercise any right,  power or remedy  vested
        in it under any of the  Security  Documents  shall  operate  as a waiver
        thereof,  nor shall any  single or  partial  exercise  by the  Mortgagee
        and/or  the  Secured  Creditors  or any of them of any  right,  power or
        remedy nor the discontinuance,  abandonment or adverse  determination of
        any proceedings  taken by the Mortgagee and/or the Secured  Creditors or
        any of them to enforce any right,  power or remedy preclude any other or
        further  exercise  thereof or  proceedings  to  enforce  the same or the
        exercise of any other right, power or remedy nor shall the giving by the
        Mortgagee  of any  consent  to any act  which by the  terms of this Deed
        requires  such consent  prejudice the right of the Mortgagee to withhold
        or give  consent to the doing of any other  similar  act.  The  remedies
        provided in the Security  Documents are cumulative and are not exclusive
        of any remedies provided by law.

12.2    Delegation

        The  Mortgagee  shall  be  entitled,  at any time and as often as may be
        expedient,  to delegate all or any of the powers and discretions  vested
        in it by the Mortgage and this Deed (including the power vested in it by
        virtue of  clause  14) or any of the other  Security  Documents  in such
        manner,  upon such terms,  and to such  persons as the  Mortgagee in its
        absolute discretion may think fit.

13      Costs and indemnity

13.1    Costs

        The Owner shall pay to the Mortgagee (as security  agent and trustee for
        and on  behalf  of the  Secured  Creditors)  and/or  any of the  Secured
        Creditors  on  demand  on  a  full  indemnity   basis  all  expenses  or
        liabilities  of  whatsoever   nature  (including  legal  fees,  fees  of
        insurance  advisers,  printing,  out-of-pocket  expenses,  stamp duties,
        registration  fees and other duties or charges)  together with any value
        added tax or similar  tax  payable in respect  thereof,  incurred by the
        Mortgagee  and/or any of the Secured  Creditors in  connection  with the
        enforcement  of,  or  preservation  of any  rights  under,  this Deed or
        otherwise in respect of the Outstanding  Indebtedness (which expression,
        for  the  avoidance  of  doubt,   includes  the  Master  Swap  Agreement
        Liabilities)  and  the  security  therefor  or in  connection  with  the
        preparation, completion, execution or registration of this Deed.

13.2    Mortgagee's indemnity

        The Owner hereby  agrees and  undertakes  to indemnify the Mortgagee and
        each of the  Secured  Creditors  against all  losses,  actions,  claims,
        expenses,  demands,  obligations and  liabilities  whatever and whenever
        arising which may now or hereafter be incurred by the  Mortgagee  and/or
        any of the  Secured  Creditors,  or by any  manager,  agent,  officer or
        employee  for  whose  liability,  act  or  omission  it  or  he  may  be
        answerable,  in  respect  of,  in  relation  to, or in  connection  with
        anything  done or omitted in the exercise or  purported  exercise of the
        powers  contained  this Deed or otherwise in  connection  therewith  and
        herewith or with any part of the Owner and the Owner's Assigned Property
        or the Charterer's  Assigned Property or otherwise howsoever in relation
        to, or in connection with, any of the matters dealt with in this Deed.

14      Attorney

14.1    Power

        By way of security,  the Owner and the Charterer each hereby irrevocably
        appoints the Mortgagee (as security  agent and trustee for and on behalf
        of the Secured  Creditors)  to be its attorney  generally for and in its
        name and on its behalf and as its act and deed or  otherwise to execute,
        seal  and  deliver  and  otherwise   perfect  and  do  all  such  deeds,
        assurances,  agreements,  instruments,  acts  and  things  which  may be
        required  for the full  exercise of all or any of the rights,  powers or
        remedies  conferred by this Deed or which may be deemed  proper in or in
        connection with all or any of the purposes  aforesaid.  The power hereby
        conferred  shall be a general  power of  attorney  under  the  Powers of
        Attorney  Act  1971,  and the  Owner  and  the  Charterer  ratifies  and
        confirms,  and  agrees  to ratify  and  confirm,  any  deed,  assurance,
        agreement,  instrument,  act or thing which the Mortgagee may execute or
        do  pursuant  thereto.  Provided  always  that such  power  shall not be
        exercisable  by or on behalf of the Mortgagee  until the happening of an
        Event of Default

14.2    Exercise of power

        The  exercise of such power by or on behalf of the  Mortgagee  shall not
        put any person dealing with the Mortgagee upon any enquiry as to whether
        any Event of Default has  happened,  nor shall such person be in any way
        affected by notice that no such Event of Default has  happened,  and the
        exercise by the Mortgagee of such power shall be conclusive  evidence of
        the Mortgagee's right to exercise the same.

14.3    Filings

        The  Owner  and the  Charterer  each  hereby  irrevocably  appoints  the
        Mortgagee  (as  security  agent  and  trustee  for and on  behalf of the
        Secured  Creditors) to be its attorney in its name and on its behalf and
        as its act and deed or  otherwise  of it,  to  agree  the form of and to
        execute and do all deeds, instruments, acts and things in order to file,
        record,  register or enrol the  Mortgage  and/or this Deed in any court,
        public office or elsewhere  which the  Mortgagee  may in its  discretion
        consider  necessary or  advisable,  now or in the future,  to ensure the
        legality, validity,  enforceability or admissibility in evidence thereof
        and any other assurance,  document, act or thing required to be executed
        by the Owner and the Charterer pursuant to clause 15.

15      Further assurance

        The Charterer hereby further  undertakes at its own expense from time to
        time to execute, sign, perfect, do and (if required) register every such
        further  assurance,  document,  act or  thing as in the  opinion  of the
        Mortgagee  may be  necessary  or  desirable  for  the  purpose  of  more
        effectually mortgaging and charging the Charterer's Assigned Property or
        perfecting  the security  constituted  or intended to be  constituted by
        this Deed.

16      Consent, Termination of Charter and Quiet Enjoyment

16.1    Consent

        In  consideration  of the Charterer  executing  this Deed, the Mortgagee
        consents to the entry by the Owner into the Charter and the  performance
        of its obligations thereunder.

16.2    Quiet Enjoyment and termination

        In  consideration  of the  undertakings  of the  Charterer  contained in
        clauses  6 and 8 and of the  Charter  Guarantor  contained  in clause 7,
        provided  (a) the  Charterer  has not  committed a breach of the Charter
        which would entitle the Owner to terminate the Charter  (including,  but
        not  limited to, a failure to pay  charterhire  in  accordance  with the
        Charter) or (b) the Charterer has not committed a breach of this Deed or
        (c) the  Charterer has not committed a breach of any of the terms of the
        co-ordination  deed  dated  June 2006 made  between,  inter  alios,  the
        Charterer  and  the  Mortgagee  (the  "Co-ordination  Deed")  or (d) the
        Charter Guarantor has not committed a breach of this Deed, the Mortgagee
        agrees  that it will not take any action as  mortgagee  against the Ship
        under  (i)  the  Loan  Agreement  and  (ii)  any of the  other  Security
        Documents,  which action would have the effect of  interfering  with the
        Charterer's quiet enjoyment of the Ship PROVIDED ALWAYS THAT:

        16.2.1  nothing in this clause 16 shall prevent the Mortgagee and/or the
                other   Creditors  (as  defined  in  the  Loan  Agreement)  from
                exercising  any  of  their  respective  rights  under  the  Loan
                Agreement  and/or  the  Security  Documents  (including  without
                limitation,  rights thereunder to foreclose,  take possession of
                and sell the Ship) if those  rights are  exercised in such a way
                as to enable the Ship to be  available to the  Charterer  during
                the Charter Period; and

        16.2.2  nothing in this clause 16 shall prevent the Mortgagee and/or the
                other  Creditors (as defined in the Loan Agreement) from joining
                or  intervening  in  or  otherwise  supporting  any  proceedings
                arising  from or relating to the arrest or detention of the Ship
                by any other person with a view to substantiating, preserving or
                protecting the Mortgagee and/or the other Creditors' (as defined
                in the Loan  Agreement)  interest  in the Ship as  mortgagee  or
                otherwise.

16.3    Termination by Mortgagee

        On the occurrence of any of the  following:

        16.3.1  an Event of Default; and

        16.3.2  if any event or  circumstance  shall have occurred  which would,
                under the terms of the  Charter,  entitle the Owner to terminate
                the Charter; or

        16.3.3  if the Charterer  shall be in default of any of its  obligations
                under this Deed; or

        16.3.4  if the  Charterer  is in  breach  of any  of  the  terms  of the
                Co-ordination Deed; or

        16.3.5  if the Charter  Guarantor shall be in default of its obligations
                under this Deed,

                the  Mortgagee  shall be  entitled to  terminate  the Charter by
                notice  to the  Owner  and the  Charterer,  which  notice  shall
                operate to terminate  the Charter  forthwith if the Ship is then
                in port and free of cargo or otherwise  upon  completion  of the
                voyage  (including  discharge  of cargo,  if any) upon which the
                Ship was  engaged at the time when the notice to  determine  was
                given and upon any  termination of the Charter  pursuant to this
                clause 16.3:

                (a)     all obligations whatsoever of the Owner thereunder shall
                        be absolutely discharged and extinguished;

                (b)     if the  Charterer  shall,  at any  time  prior  to  such
                        termination,  have  been in  repudiatory  breach  of the
                        terms of the Charter,  such termination by the Mortgagee
                        shall,  as between the Owner and the Charterer,  operate
                        as  an  acceptance  by  the  Owner  of  the  Charterer's
                        repudiation  of the  Charter  and the  Owner's  right to
                        recover damages in respect of such  repudiation (as such
                        right has been  assigned to the Mortgagee by the Charter
                        Assignment) shall be fully preserved; and

                (c)     the  Charterer  shall cease to be in  possession  of the
                        Ship with the  consent of the Owner (or with the consent
                        of the  Mortgagee  as the  Owner's  assignee)  and shall
                        forthwith  vacate  possession  of the Ship in an orderly
                        fashion,  Provided  that such  vacating of possession of
                        the Ship by the Charterer shall not of itself constitute
                        the Mortgagee a mortgagee-in-possession of the Ship.

16.4    Preservation of Owner's rights

        If the  circumstances  in which the  Mortgagee  becomes  entitled  under
        clauses  16.2 or 16.3 to  determine  the  Charter  shall  constitute  or
        include  grounds on which the Owner was entitled to determine  the same,
        any  determination  by the Mortgagee shall (as between the Owner and the
        Charterer)  operate  as an  acceptance  by the Owner of the  Charterer's
        repudiation  of the Charter and the Owner's right to recover  damages in
        respect of such repudiation shall be fully preserved.

16.5    Remedy of Owner's breach

        Notwithstanding anything herein contained, the Owner shall remain liable
        to perform all the  obligations  assumed by it under the Charter and the
        Mortgagee  shall have no obligations  whatsoever  thereunder or be under
        any liability whatsoever to the Charterer in event of any failure by the
        Owner to  perform  its  obligations  thereunder  or  hereunder  provided
        however that:

        16.5.1  a notice in writing (which shall set out full particulars of the
                matters  complained  of and  which  is  hereinafter  called  the
                "notice  of  complaint")  shall  be  immediately  given  by  the
                Charterer  to the  Mortgagee  in event of any  breach or alleged
                breach of the  Charter  by the Owner by  reason  whatsoever  the
                Charterer claims to be entitled to determine the Charter;

        16.5.2  within  fifteen (15) days after  receipt by the Mortgagee of any
                notice of complaint by the Mortgagee  shall be entitled (but not
                bound) to notify the  Charterer  in writing of its  intention to
                remedy the matters complained of by such notice of complaint and
                any remedial measures thereafter taken by the Mortgagee shall be
                without  prejudice to the Charterer's right to claim against the
                Owner  in  respect  of  any  loss  and  damage  suffered  by the
                Charterer by reason of such breach but in no circumstances shall
                the Mortgagee be under any  liability  therefore or for any loss
                or  damage  suffered  by the  Charterer  arising  from  delay or
                otherwise in effecting  such remedial  measures as the Mortgagee
                (whose decision shall be final) deems appropriate; and

        16.5.3  all expenses  whatsoever  incurred by the  Mortgagee in or about
                such  remedial  measures  as may  be  undertaken  on its  behalf
                pursuant to clause 16.5.2 shall be  recoverable by the Mortgagee
                from  the  Owner  on  demand  but  payment  by the  Owner to the
                Mortgagee pursuant to such demand shall not as between the Owner
                and the  Charterer  operate  as an  admission  by the  Owner  of
                liability for the matters  complained of in the relevant  notice
                of complaint.

16.6    Sale free of or subject to Charter

        Notwithstanding anything herein contained, in the event of a sale of the
        Ship  during the  Charter  Period  pursuant  to the power in that behalf
        vested in the Mortgagee by virtue of the Security  Documents,  such sale
        shall  be  free  of or  subject  to the  Charter  at the  option  of the
        Mortgagee.

16.7    Sale subject to Charter

        If the Ship is sold subject to the Charter (which  expression means that
        the purchaser of the Ship or any other person  chartering  the Ship from
        the purchaser  shall as from the date on which the Ship is registered in
        the name of the purchaser assume all future  obligations and acquire all
        future  rights and  benefits  under the  Charter),  the Owner and/or the
        Charterer  shall enter into such form of agreement with the purchaser as
        the  Mortgagee  may require to the intent that such  purchaser  or other
        person shall be  substituted in place of the Owner as owner or disponent
        owner of the Ship for the purposes of the Charter.

16.8    Sale free of Charter

        Without  prejudice to clauses 16.2 and 16.3, if the Ship is sold free of
        the Charter,  the Owner and the Charterer  shall enter into such form of
        agreement or agreements  as the Mortgagee may require for  determination
        of the Charter by mutual consent.

17      Continuation of Charter Period

        The Charterer shall continue to pay charterhire under the Charter on the
        days and in the amounts required under the Charter  notwithstanding that
        the Ship  shall  become  a Total  Loss or that  the  Charterer  shall be
        permanently deprived of her use for any other reason prior to the end of
        the Charter Period,  provided that no further instalments of charterhire
        shall  become due and  payable  after the  Borrowers  have  prepaid  the
        Advance  relevant  to such Ship or any other  part of the Loan As may be
        required in clause 4.3 of the Loan Agreement.

18      Notices

18.1    Every notice,  request,  demand or other  communication  under this Deed
        shall:

        18.1.1  be in writing  delivered  personally or by  first-class  prepaid
                letter (airmail if available) or facsimile transmission or other
                means of telecommunication in permanent written form;

        18.1.2  be deemed to have been  received  in the case of a letter,  when
                delivered  personally or three (3) days after it has been put in
                to the post  and,  in the case of a  facsimile  transmission  or
                other means of  telecommunication  in permanent written form, at
                the time of despatch  (provided  that if the date of despatch is
                not a business  day in the  country of the  addressee  or if the
                time of  despatch  is after the close of business in the country
                of the addressee it shall be deemed to have been received at the
                opening of business on the next such business day); and

        18.1.3  be sent:

                (a)   if to the Owner at:

                      c/o ICON Capital Corp.
                      100 Fifth Avenue,
                      4th Floor
                      New York, NY 10011
                      USA


                      Fax no:  +1 (212) 4184739
                      Attention:  General Counsel

                (b)   if to the Charterer at:

                      c/o Top Tanker Management Inc.
                      109-111 Messogion Avenue
                      155 26 Athens Greece

                      Fax no:  +30 210 6978 107
                      Attention:  Legal Department

                (c)   if to the Mortgagee at:

                      Fortis Bank (Nederland) N.V.
                      Coolsingel 93
                      3012 AE Rotterdam
                      The Netherlands

                      Fax no: +31 10 401 2353
                      Attention:  Mr Tom van Vonderen

                or to such other  address  and/or  numbers as is notified by one
                party to the other parties under this Deed.

19      Counterparts

        This Deed may be entered  into in the form of two or more  counterparts,
        each  executed  by one or more of the  parties,  and,  provided  all the
        parties shall so execute this Deed,  each of the executed  counterparts,
        when duly exchanged or delivered, shall be deemed to be an original but,
        taken together, they shall constitute one instrument.

20      Severability of provisions

        Each of the  provisions in this Deed are severable and distinct from the
        others,  and if at any time one or more such  provisions  is or  becomes
        invalid,   illegal  or   enforceable,   the   validity,   legality   and
        enforceability of the remaining provisions of this Deed shall not in any
        way be affected or impaired thereby.

21      Law and jurisdiction

21.1    Law

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

21.2    Submission to jurisdiction

        For the benefit of the Mortgagee,  the parties hereto  irrevocably agree
        that any legal action or proceedings in connection with this Deed may be
        brought in the  English  courts,  or in the courts of any other  country
        chosen by the Mortgagee, each of which shall have jurisdiction to settle
        any disputes arising out of or in connection with this Deed. Each of the
        Owner,  the  Charter   Guarantor  and  the  Charterer   irrevocably  and
        unconditionally  submits to the jurisdiction of the English courts,  and
        the courts of any country  chosen by the  Mortgagee  and the Owner,  the
        Charter Guarantor and the Charterer irrevocably  designate,  appoint and
        empower Law  Debenture  Corporate  Services  Limited at present of Fifth
        Floor,  100 Wood  Street,  London EC2V 7EX,  England (in the case of the
        Owner) and Top Tankers (UK) Limited at present of 50 Park Street, London
        W1K 2JJ,  United  Kingdom (in the case of the  Charterer and the Charter
        Guarantor)  to  receive,  for it and on its  behalf,  service of process
        issued  out of the  English  courts in any legal  action or  proceedings
        arising out of or in connection  with this Deed.  The submission to such
        jurisdiction  shall not (and shall not be  construed so as to) limit the
        right of the Mortgagee to take proceedings  against the Owner and/or the
        Charterer  and/or the Charter  Guarantor in any other court of competent
        jurisdiction  nor shall the  taking  of  proceedings  in any one or more
        jurisdictions   preclude  the  taking  of   proceedings   in  any  other
        jurisdiction,  whether  concurrently  or not. The parties  further agree
        that only the courts of England  and not those of any other  State shall
        have  jurisdiction  to  determine  any  claim  which  the  Owner  or the
        Charterer  and/or the Charter  Guarantor  may have against the Mortgagee
        arising out of or in connection with this Deed.

21.3    Contracts (Rights of Third Parties) Act 1999

        Save for clauses  5.6, 5.7 and 5.8 (which can be enforced by the Secured
        Creditors  although they are not a party to this Deed),  no term of this
        Deed shall be  enforceable  pursuant to the  Contracts  (Rights of Third
        Parties) Act 1999 by a person who is not a party to this Deed.

IN WITNESS  whereof this Deed has been duly  executed as a deed the day and year
first above written
<PAGE>

                                   Schedule 1
                          Forms of Loss Payable Clauses

(1)     Hull and machinery (marine and war risks)

        By a General Assignment dated [o] 2006, ISOMAR MARINE COMPANY LIMITED of
        1 Costakis Pantelides Avenue, Kolokasides Building, 1010 Nicosia, Cyprus
        (the  "Owner")  and by a  Quadripartite  Deed  dated [o] 2006 and PAGEON
        SHIPPING  COMPANY  LIMITED of 284 Arch.  Makarios III Avenue,  Limassol,
        Cyprus (the  "Charterer")  have each assigned to FORTIS BANK (NEDERLAND)
        N.V.  of  Coolsingel  93,  3012  AE  Rotterdam,   The  Netherlands  (the
        "Mortgagee")  (as  security  agent and  trustee for and on behalf of the
        Secured Creditors as therein defined (the "Secured  Creditors")) all the
        Owner's and the  Charterer's  rights,  title and  interest in and to all
        policies  and  contracts  of  insurance  from time to time  taken out or
        entered into by or for the benefit of the Owner and/or the  Charterer in
        respect of m.v. "Vanguard' and accordingly:

        (a)     all claims  hereunder in respect of an actual or constructive or
                compromised or arranged total loss, and all claims in respect of
                a major  casualty  (that  is to say any  casualty  the  claim in
                respect  of  which   exceeds  Five  hundred   thousand   Dollars
                ($500,000) (or the equivalent in any other  currency)  inclusive
                of any  deductible  shall be paid in full to the  Mortgagee  (as
                security  agent and  trustee  for and on  behalf of the  Secured
                Creditors) or to its order; and

        (b)     all  other  claims  hereunder  shall  be  paid  in  full  to the
                Charterer or to its order,  unless and until the Mortgagee shall
                have notified insurers hereunder to the contrary,  whereupon all
                such claims shall be paid to the  Mortgagee  (as security  agent
                and trustee for and on behalf of the  Secured  Creditors)  or to
                its order.

(2)     Protection and indemnity

        Payment  of any  recovery  which  ISOMAR  MARINE  COMPANY  LIMITED  of 1
        Costakis Pantelides Avenue,  Kolokasides Building,  1010 Nicosia, Cyprus
        (the "Owner") or PAGEON SHIPPING  COMPANY LIMITED of 284 Arch.  Makarios
        Ill Avenue,  Limassol,  Cyprus (the "Charterer") is entitled to make out
        of the funds of the  Association in respect of any  liability,  costs or
        expenses  incurred by the Owner or the  Charterer,  shall be made to the
        Owner or the Charterer or to its order, unless and until the Association
        receives  notice to the contrary  from FORTIS BANK  (NEDERLAND)  N.V. of
        Coolsingel 93, 3012 AE Rotterdam,  The Netherlands (the  "Mortgagee") in
        which event all recoveries  shall thereafter be paid to the Mortgagee or
        their order;  provided that no liability  whatsoever shall attach to the
        Association, its Managers or their agents for failure to comply with the
        latter  obligation  until the expiry of two clear business days from the
        receipt of such notice.
<PAGE>

                                   Schedule 2
                  Forms of Notices of Assignment of Insurances

                              Notice of Assignment
              (For attachment by way of endorsement to the Policy)


ISOMAR MARINE  COMPANY  LIMITED (the "Owner") of 1 Costakis  Pantelides  Avenue,
Kolokasides Building,  1010 Nicosia,  Cyprus and PAGEON SHIPPING COMPANY LIMITED
(the "Charterer") of 284 Arch. Makarios III Avenue, Limassol, Cyprus, the owners
and demise  charterers  respectively of the motor vessel  "Vanguard' HEREBY GIVE
NOTICE that by a General Assignment dated [o] 2006 and entered into by the Owner
with FORTIS BANK  (NEDERLAND)  N.V.  (the  "Mortgagee")  (as security  agent and
trustee  for and on behalf of the  Secured  Creditors  as therein  defined  (the
"Secured  Creditors"))  and by a  Quadripartite  Deed dated [o] 2006 and entered
into by,  inter  alios,  the  Charterer  and the Owner  with the  Mortgagee  (as
security  agent and trustee for and on behalf of the Secured  Creditors),  there
has been assigned by us to the Mortgagee (as security  agent and trustee for and
on behalf  of the  Secured  Creditors)  as  mortgagees  of the said  vessel  all
insurances in respect  thereof,  including  the  insurances  constituted  by the
policy whereon this notice is endorsed.

/s/ Mark Gatto
---------------------------------
Signed
For and on behalf of
ISOMAR MARINE COMPANY LIMITED

Dated [o] 2006



--------------------------------
Signed
For and on behalf of
PAGEON SHIPPING COMPANY LIMITED


Dated [o] 2006


SIGNED, SEALED and DELIVERED
by Mark Gatto                                          /s/ Mark Gatto
for and on behalf of                              -----------------------------
ISOMAR MARINE COMPANY LIMITED                         Attorney-in-fact
as Owner

     /s/ Vikki Madia
--------------------------------
In the presence of:



Witness         Vikki Madia
Name:           Norton Rose
Address:        Piraeus
Occupation:



SIGNED, SEALED and DELIVERED
by Eirini Alexandropolou                            /s/ Eirini Alexandropolou
for and on behalf of                              -----------------------------
PAGEON SHIPPING COMPANY LIMITED                       Attorney-in-fact
as Charterer

     /s/ Vikki Madia
---------------------------------
in the presence of:


Witness         Vikki Madia
Name:           Norton Rose
Address:        Piraeus
Occupation:


EXECUTED as a DEED
by Eirini Alexandropolou
for and on behalf of                               /s/ E. Alexandropolou
TOP TANKERS INC. as                               -----------------------------
Charter Guarantor                                     Attorney-in-fact

     /s/ Vikki Madia
-------------------------------
in the presence of



Witness         Vikki Madia
Name:           Norton Rose
Address:        Piraeus
Occupation:


EXECUTED as a DEED
by C. Economides
for and on behalf of                               /s/ C. Economides
FORTIS BANK (NEDERLAND) N.V.                      -----------------------------
as Mortgage                                           Attorney-in-fact

     /s/ Vikki Madia
--------------------------------
In the presence of:


Witness         Vikki Madia
Name:           Norton Rose
Address:        Piraeus
Occupation: