exv10w15



 







 




    Exhibit 10.15



 




    MEMORANDUM
    OF AGREEMENT




 



    Dated: 3 May 2006





 



    Potomac Seaway Carriers Co. of 80 Broad Street, Monrovia,
    Liberia hereinafter called the Sellers, have agreed to sell, and
    Quintana Maritime Limited (“QML”) of Trust Company
    Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall
    Islands MH96960 or a company to be nominated by QML pursuant to
    clause 29 hereof




 



    hereinafter called the Buyers, have agreed to buy



 



	 	 	 
	

    Name:
    


	
 
	
    Hull No 1375 see also
    clause 25 hereof
    

	

    Classification Society/Class:
    


	
 
	
    Nippon Kaiji Kyokai
    

	

    Built: expected on or before 2006
    


	
 
	
    By: Tsuneishi Shipbuilding Co.,
    Ltd, of 1083 Tsuneishi, Numakuma-cho, Numakuma-gun, Hiroshima
    Prefecture, Japan (the “Builder”)
    

	

    Flag: see clause 8, line 206
    hereof
    


	
 
	
    Place of Registration: see
    clause 8, line 206 hereof
    

	

    Call Sign: n/a
    


	
 
	
    Grt/Nrt: about 43,500/27,000 and
    otherwise in accordance with the Specifications
    

	

    Register Number: n/a
    


	
 
	
 










 



    hereinafter called the Vessel, on the following terms and
    conditions:



 




    Definitions




 



    “Banking days” are days on which banks are open both
    in the country of the currency stipulated for the Purchase Price
    in Clause 1, and in the place of
    closing stipulated in Clause 8. where a payment is
    to be made under this Agreement.




 



    “In writing” or “written” means a letter
    handed over from the Sellers to the Buyers or vice versa, a
    registered letter, telex, telefax or other modern form of
    written communication.



 



    “Classification Society” or “Class” means
    the Society referred to in line 4.




 



    “Charter” means the time charter dated
    21 November 2005, made between the Charterer and Metrostar,
    as agent for, inter alios, the Sellers, as the same has been
    amended from time to time until the date of this Agreement,
    pursuant to which time charter the Sellers have agreed, inter
    alios, to let the Vessel and the Charterer has agreed to take on
    charter the Vessel on a time charter basis until
    31 December 2010, a copy of which charter is attached
    hereto as Appendix “A”.




 



    “Charterer” means Bunge S.A. of Geneva, Switzerland
    and includes its successors in title.




 



    “Metrostar” means Metrostar Management Corp. of 80
    Broad Street, Monrovia, Liberia.





 



    “Resale Agreement” means the “Saleform 1993”
    memorandum of agreement dated 3 May 2005 made between the
    Intermediate Seller and Metrostar or its nominee and by a
    nomination letter Metrostar has nominated the Sellers pursuant
    to which the Intermediate Seller shall deliver the Vessel to the
    Sellers, a copy of which is attached hereto as
    Appendix “B”.





 



    “Shipbuilding Contract” means the shipbuilding
    contract made between the Builder and Kambara Kisen Co., Ltd.
    (“Kambara”) as transferred by means of a nomination to
    Chijin Shipping S.A. of 53rd Street, Urbanizacion Obarrio, Torre
    Bancosur, Panama City, Republic of Panama (the
    “Intermediate Seller”) in relation to the construction
    of the Vessel by the Builder for delivery and sale to the
    Intermediate Seller.




 



    “Shipyard” means, in relation to the Vessel, the
    Builders’ facilities where the Vessel is being built and
    which are located at Numakuma, Japan or Tadotsu, Japan, as the
    case may be.













 






 



    “Specifications” means the specifications and plans to
    the Shipbuilding Contract delivered to the Sellers by the
    Intermediate Seller pursuant to clause 20 of the Resale
    Agreement, a copy of which specifications and plans are attached
    hereto as Appendix “C”.




 



    “United States Dollars” and “US$” means the
    lawful currency of the United States of America at any relevant
    time.



 


		
	
    1.  
	
    Purchase
    Price




 



    US$43,300,000 minus any adjustments as provided in
    clause 21.



 


		
	
    2.  
	
    Deposit





 



    As security for the correct fulfillment of this Agreement the
    Buyers shall pay a deposit of 10% (ten per cent) of the Purchase
    Price within on the later of (i) the day
    falling three banking days from the date of
    this Agreement is signed by the parties hereto and
    (ii) 15 May 2006. This deposit shall be placed with a
    first class bank nominated by the Sellers and accepted by the
    Buyers (provided always such bank is incorporated in the US,
    England or Greece and the branch thereof where the deposit will
    be held is in any of these countries) and held by them in an
    interest bearing joint bank account for the Sellers and the
    Buyers, to be released in accordance with joint written
    instructions of the Sellers and the Buyers.
    AccruedIinterest, if any, to
    be credited to the Buyers. Any fee charged by the bank nominated
    by the Sellers pursuant to line 20 above for holding the said
    deposit shall be borne equally by the Sellers and the Buyers.




 


		
	
    3.  
	
    Payment





 



    The remaining 90% of the said Purchase Price shall be paid in
    full free of bank charges three (3) days prior to the
    estimated delivery date in the name of the Buyers or the
    Buyers’ financier to a first class bank nominated by the
    Sellers and accepted by the Buyers (provided always such bank is
    incorporated in the US, England or Greece and the branch thereof
    where the deposit will be held is in any of these countries).
    The Purchase Price will be released by the Buyers or their
    financiers on delivery of the Vessel and upon the signing of the
    Protocol of Delivery and Acceptance from the Sellers and the
    Buyers but not later than 3 banking days after the Vessel
    is in every respect physically ready for delivery in accordance
    with the terms and conditions of this Agreement and Notice of
    Readiness has been given in accordance with Clause 5.




 


		
	
    4.  
	
    Inspections —
    see
    Clause 24
    





 



    a)* The Buyers have inspected and accepted the
    Vessel’s classifications records. The Buyers have also
    inspected the Vessel
    at/in                    
    on                    
    and have accepted the Vessel following this inspection and the
    sale is outright and definite, subject only to the terms and
    conditions of this Agreement.





 



    b)* The Buyers shall have the right to inspect the
    Vessel’s classification records and declare whether same
    are accepted or not within





 



    The Sellers shall provide for inspection of the vessel
    at/in





 



    The buyers shall undertake the inspection without undue
    delay to the Vessel. Should the Buyers cause undue delay they
    shall compensate the Sellers for the losses thereby incurred.
    The Buyers shall inspect the Vessel without opening up and
    without cost to the Sellers During the inspection the
    Vessel’s deck and engine log books shall be made available
    for examination by the Buyers. If the Vessel is accepted after
    such inspection, the sale shall become outright and definite,
    subject only to the terms and conditions of this Agreement,
    Provided the Sellers receive written notice of acceptance from
    the Buyers within 72 hours after completion of such
    inspection. Should notice of acceptance of the Vessel’s
    classification records and of the Vessel not be received by the
    Sellers as aforesaid, the deposit together with interest earned
    shall be released immediately to the Buyers, whereafter this
    Agreement shall be null and void.



 

 


    * Notes, if any, in the surveyor’s report
    which are accepted by the Classification Society without
    condition/recommendation are not to taken into account.













 






    4a) and 4b) are alternatives; delete whichever is not
    applicable. In the absence of deletions, alternative 4a) to
    apply.



 


		
	
    5.  
	
    Notices,
    time and place of delivery





 



    a) The Sellers shall keep the Buyers well informed of the
    Vessel’s itineraryestimated time of
    delivery and shall provide the Buyers with 30, 15, 10 and
    3 days approximate notice and 1 day definite notice
    thereof of the estimated time of arrival at the intended
    place of drydocking/underwater inspection/delivery.
    When the Vessel is at the place of delivery and
    in every respect physically ready for delivery in
    accordance with this Agreement, the Sellers shall give the
    Buyers a written Notice of Readiness for delivery.





 



    b) Subject to the Vessel having completed her sea trials in
    accordance with the Shipbuilding Contract and the Specifications
    and subject to the terms of this Agreement,
    Tthe Vessel shall be delivered and taken over
    safely afloat at a safe and-accessible berth or anchorage
    at/in the Seller’s option, at the Shipyard
    alongside the Builder’s pier or Builder’s anchorage.
    If the Vessel is delivered to the Buyers at the Builders’
    pier, the Buyers shall remove the same therefrom as soon as
    practically possible after being instructed by the Builder to do
    so.





 



    Expected time of delivery: upon delivery of the Vessel from the
    Intermediate Seller to the Sellers





 



    Date of canceling (see Clauses 5c) 6b) (iii)
    and 14): 15 December 2006.





 



    c) If the Sellers anticipated that, notwithstanding
    the exercise of due diligence by them, the Vessel will not be
    ready for delivery by the cancelling date they may notify the
    Buyers in writing stating the date when they anticipate that the
    Vessel will be ready for delivery and propose a new cancelling
    date. Upon receipt of such notification the Buyers shall have
    the option of either cancelling this Agreement in accordance
    with Clause 14 within 7 running days of receipt of the
    notice or of accepting the new date as the new cancelling date.
    If the Buyers have not declared their option within 7 running
    days of receipt of the Sellers’ notification or if the
    Buyers accept the new date, the date proposed in the
    Sellers’ notification shall be deemed to be the new
    cancelling date and shall be substituted for the cancelling date
    stipulated in line 61.





 



     If this Agreement is maintained with the new
    cancelling date all other terms and conditions hereof including
    those contained in Clauses 5 a) and 5 c) shall
    remain unaltered and in full force and effect. Cancellation or
    failure to cancel shall be entirely without prejudice to any
    claim for damages the Buyers may have under Clause 14 for
    the Vessel not being ready by the original canceling
    date.





 



    d) Should the Vessel become an actual, constructive or
    compromised total loss before delivery the deposit together with
    interest earned shall be released immediately to the Buyers
    whereafter this Agreement shall be null and void, unless the
    Builder, in accordance with the relevant clauses of the
    Shipbuilding Contract, agrees to reconstruct the Vessel in which
    case the Buyers shall have the option to declare in writing that
    the deposit should not be released to it whereafter this
    Agreement shall remain in place




 


		
	
    6  
	
    Drydocking/Divers
    Inspection





 



    a)** The Sellers shall place the Vessel in drydock
    at the port of delivery for inspection by the Classification
    Society of the Vessel’s underwater parts below the deepest
    load line, the extent of the inspection being in accordance with
    the Classification Society’s rules. If the rudder,
    propeller, bottom or other underwater parts below the deepest
    load line are found broken, damaged or defective so as to affect
    the Vessel’s class, such defect shall be made good at the
    Seller’s expense to the satisfaction of the Classification
    Society without condition/recommendation*.





 



    b)** (i) The Vessel is to be delivered without
    drydocking. However, the Buyers shall have the right at their
    expense to arrange for an underwater inspection by a diver
    approved by the Classification Society prior to the delivery of
    the Vessel. The Sellers shall at their cost make the Vessel
    available for such inspection. The extent of the inspection and
    the conditions under which it is performed shall be to the
    



 

 


    ** 6a) and 6b) are alternatives delete whichever is
    not applicable. In the absence of deletions alternative 6a) to
    apply













 







     satisfaction of the classification Society. If the
    conditions at the port of delivery are unsuitable for such
    inspection, the Sellers shall make the Vessel available at a
    suitable alternative place near to the delivery port.





 



     (ii) if the rudder, propeller, bottom or
    other underwater parts below the deepest load line are found
    broken, damaged or defective so as affect the Vessel’s
    class, then unless, repairs can be carried out afloat to the
    satisfaction of the Classification Society, the Sellers shall
    arrange for the Vessel to be drydocked at their expenses for
    inspection by the Classification Society of the Vessel’s
    underwater parts below the deepest load line, the extent of the
    inspection being in accordance with the Classification
    Society’s rules. If the rudder, propeller, bottom or other
    underwater parts below the deepest load line are found broken,
    damaged or defective so as to affect the Vessel’s class,
    such defects shall be made good by the Sellers at their expense
    to the satisfaction of the Classification Society without
    condition/recommendation*. In such event the
    Sellers are to pay also for the cost of the underwater
    inspection and the Classification Society’s
    attendance.





 



     (iii) if the Vessel is to be drydocked
    pursuant to Clause 6 b) (ii) and no suitable
    drydocking facilities are available at the port of delivery, the
    Sellers shall take the Vessel to a port where suitable
    drydocking facilities are available, whether within or outside
    the delivery range as per Clause 5 b). Once drydocking
    has taken place the Sellers shall deliver the Vessel at a port
    within the delivery range as per Clause 5 b) which
    shall, for the purpose of the Clause, become the new port of
    delivery. In such event the cancelling date provided for in
    Clause 5 b) shall be extended by the additional time
    required for the drydocking and extra steaming, but limited to a
    maximum of 14 running days.





 



    c) If the Vessel is drydocked pursuant to Clause 6
    a) or 6 b) above.





 



     (i) the Classification Society may require
    survey of the tailshaft system, the extent of the survey being
    to the satisfaction of the Classification surveyor. If such
    survey is not required by the Classification Society, the Buyers
    shall have the right to require the tailshaft to be drawn and
    surveyed by the Classification Society, the extent of the survey
    being in accordance with the Classification Society’s rules
    for tailshaft survey and consistent with the current stage of
    the Vessel’s survey cycle. The Buyers shall declare whether
    they require the tailshaft to be drawn and surveyed not later
    that by the completion of the inspection by the Classification
    Society. The drawing and refitting of the tailshaft shall be
    arranged by the Sellers. Should any parts of the tailshaft
    system be condemned or found defective so as to affect the
    Vessel’s class, those parts shall be renewed or made good
    at the Sellers’ expense to the satisfaction of the
    Classification Society without
    condition/recommendation*.





 



     (ii) the expense relating to the survey of
    the tailshaft system shall be borne by the Buyers unless the
    Classification society requires such survey to be carried out,
    in which case the Sellers shall pay these expenses. The Sellers
    shall also pay the expenses if the Buyers require the survey and
    parts of the system are condemned or found defective or broken
    so as to affect the Vessel’s class*.





 



     (iii) the expenses in connection with putting
    the Vessel in and taking her out of drydock, including the
    drydock dues and the Classification Society’s fees shall be
    paid by the Sellers if the Classification society issues any
    condition/recommendation* as a result of the survey or if it
    requires survey of the tailshaft system. In all other cases the
    buyers shall pay the aforesaid expenses, dues and fees.





 



     (iv) the Buyers’ representative shall
    have the right to be present in the drydock, but without
    interfering with the work or decisions of the Classification
    surveyor.





 



     (v) the Buyers shall have the right to have
    the underwater parts of the Vessel cleaned and painted at their
    risk and expense without interfering with the Sellers’ or
    the Classification surveyor’s work, if any, and without
    affecting the Vessel’s timely delivery. If however, the
    Buyers’ work in drydock is still in progress when the
    Sellers have completed the work which the Sellers are required
    to do, the additional docking time needed to complete the
    Buyers’ work shall be for the Buyers’ risk and
    expense. In the event that the Buyers’ work requires such
    additional time, the Sellers may upon completion of the
    Sellers’ work 



 

 


    * Notes, if any, in the surveyor’s report
    which are accepted by the Classification Society without
    condition/recommendation are not to taken into account.













 







     tender Notice of Readiness for delivery whilst the
    Vessel is still in drydock and the buyers shall be obliged to
    take delivery in accordance with Clause 3, whether the
    vessel is in drydock or not and irrespective of
    Clause 5 b).







 


		
	
    7.  
	
    Spares/bunkers,
    etc.






 



    The Sellers shall deliver the Vessel to the Buyers with
    everything belonging to her on board and on shore All spare
    parts and spare equipment including spare tail-end shaft(s)
    and/or spare
    propeller(s)/propeller blade(s), if any, belonging to the Vessel
    at the time of inspection, used or unused,
    whether onboard or not shall become the Buyers’ property
    but including for the avoidance of doubt and
    without limiting the generality of the foregoing spares on
    order, if any, as well as all those parts and equipment
    mentioned in the Shipbuilding Contract[, the Resale Agreement]
    and the Specifications are to be excluded.
    Forwarding charges, if any, shall be for the Buyers’
    account. The Sellers are not required to replace spare
    parts including spare tail end shaft(s) and spare
    propeller(s)/propeller blade(s) which are taken out of spare and
    used as replacement prior to delivery, but the replaced items
    shall be the property of the Buyers. The radio
    installation and navigational equipment shall be included in the
    sale without extra payment, if they are the property of
    the Sellers. Unused stores and provisions, if any,
    shall be included in the sale and be taken over by the Buyers
    without extra payment. All items listed in section III of
    the Specifications such as entertainment equipment, hardware,
    crockery, gymnastic apparatus, consumable stores, etc. to be for
    Buyers’ account. Spare parts to be in accordance with the
    requirements of the Classification Society.





 



    The Sellers have the right to take ashore crockery,
    plates, cutlery, linen and other articles bearing the
    Sellers’ flag or name, provided they replace same with
    similar unmarked items. Library, forms, etc. exclusively for us
    in the Sellers’ vessel(s) shall be excluded without
    compensation. Captain’s Officers’ and Crew’s
    personal belongings including slop chest are to be excluded from
    the sale as well as the following additional items (including
    items on hire):





 



    The Buyers shall take over remaining bunkers and unused
    lubricating oils in storage tanks and sealed drums and pay an
    amount equal to that payable by the Sellers to the Intermediate
    Sellers or, as the case may be, the Builder. the current
    net market price (excluding barging expenses) at the port and
    date of delivery of the Vessel. Payment under this
    Clause shall be made at the same time and place and in the same
    currency as the Purchase Price.





 


		
	
    8.  
	
    Documentation





 



    The place of closing; London, England or Piraeus, Greece in the
    Buyer’s option



 



    In exchange for payment of the Purchase Price the Sellers shall
    furnish the Buyers with delivery documents, namely:




 



    a) Three originals of a Legal Bill of Sale in a form
    recordable in (the country in which the Buyers are to register
    the Vessel) and which the Buyers should nominate at least 10
    running days prior to the delivery of the Vessel, warranting
    that the Vessel is free from all encumbrances, mortgages and
    maritime liens or any other debts or claims whatsoever, duly
    notarially attested and legalized by the consul of such country
    or other competent authority.




 



    b) All delivery documents to be delivered to the Sellers by
    the intermediate Seller
    and/or the
    Builder under the Shipbuilding Contract [and the Resale
    Agreement], including the document called the
    “Builder’s Certificate”.




 



    b) Current Certificate of Ownership issued by the
    competent authorities of the flag state of the Vessel.





 



    c) Confirmation of Class issued within 72 hours
    prior to delivery.





 



    d) Current Certificate issued by the competent
    authorities stating that the Vessel is free from registered
    encumbrances.





 



    e) Certificate of Deletion of the Vessel from the
    Vessel’s registry or other official evidence of deletion
    appropriate to the Vessel’s registry at the time of
    delivery, or, in the event that the registry 














 







     does not as a matter of practice issue such
    documentation immediately, a written undertaking by the Sellers
    to effect deletion from the Vessel’s registry forthwith and
    furnish a Certificate or other official evidence of deletion to
    the Buyers promptly and latest within 4 (four) weeks after
    the Purchase Price has been paid and the Vessel has been
    delivered.





 



    c) Any such additional documents as may reasonably be
    required by the competent authorities for the purpose of
    registering the Vessel, as well as any such additional documents
    that the Buyers shall require for the purpose of ascertaining
    (i) the proper constitution of the Sellers and
    (ii) that all appropriate corporate and other action has
    been taken in connection with the authorization and the
    performance by the Sellers of this Agreement, the novation of
    the Charter as provided in clause 19 hereof together with
    any documents referred therein, and the assignment of the
    warranty of quality as provided in clause 18 hereof
    together with any documents referred therein, provided the
    Buyers notify the Sellers of any such documents as soon as
    possible after the date of this Agreement and provided further
    that in relation to the Charterer, the Builder, the Intermediate
    Seller, the Shipbuilding Contract, etc. the Sellers shall use
    their best endeavours to provide the Buyers with documentation
    similar to the one they shall deliver in relation to the
    Sellers, this Agreement, the novation of the Charter, etc.




 



    At the time of delivery the Buyers and Sellers shall sign and
    deliver to each other a Protocol of Delivery and Acceptance
    confirming the date and time of delivery of the Vessel from the
    Sellers to the Buyers.




 



    At the time of delivery the Sellers shall hand to the Buyers the
    classification certificate(s) (Provided that the Buyers supply
    the Builder with the necessary information required by the
    Classification Society for issuing such certificates in the
    Buyers’ name) (as provided in Clause 11 hereof) as
    well as all plans etc., relating to the Vessel and her equipment
    which are whether or not the same are on board
    the Vessel. Other certificates which are
    whether or not the same are on board the Vessel shall
    also be handed over to the Buyers unless the Sellers are
    required to retain same, in which case the Buyers to have the
    right to take copies. Other technical documentation which may be
    in the Sellers’ possession (including the Specifications,
    the Vessel’s shipbuilding drawings, equipment manuals, sea
    trial records, correspondence with the Builder or the
    Classification Society concerning the Vessel or its equipment)
    shall be promptly forwarded to the Buyers at their expense. The
    Sellers shall also deliver to the Buyers any ship replica model
    that the Builder has produced in relation to the Vessel and the
    cost of forwarding such replica model to the Buyers shall be
    borne by the Buyers, if they so request. The Sellers may
    keep the copies of the Vessel’s log books—but the
    Buyers to have the right to take copies of same. The
    Buyers and the Sellers agree to arrange for an undocumented
    transfer, i.e. for the Vessel to be registered directly in the
    Buyers’ name, and the Sellers shall procure that the
    Intermediate Seller also shall not register its title prior to
    tendering delivery to the Sellers pursuant to their contractual
    arrangements.




 


		
	
    9.  
	
    Encumbrances




 



    The Sellers warrant that the Vessel at the time of delivery
    under this Agreement, is free from all charters (save for the
    Charter, in relation to which the Sellers agree to exercise
    their best endeavours in order that the delivery of the Vessel
    under this Agreement is effected expeditiously, efficiently and
    with minimum cost and delays to all parties involved)
    encumbrances, Mortgages and maritime liens or any other debts or
    claims whatsoever. The Sellers hereby undertake to indemnify the
    Buyers against all consequences of claims made against the
    Vessel which have been incurred prior to the time of delivery.



 


		
	
    10.  
	
    Taxes,
    etc.





 



    Subject to clause 8 hereof, Aany taxes,
    fees and expenses in connection with the purchase and
    registration under the Buyers’ flag shall be for the
    Buyers’ account, whereas similar charges in
    connection with the closing of the Sellers’
    register in connectioned with the
    delivery of the Vessel to the Sellers by the Intermediate Seller
    shall be for the Sellers’ account.














 





		
	
    11.  
	
    Condition
    on delivery





 



    The Vessel with everything belonging to her shall be at the
    Sellers’ risk and expense until she is delivered to the
    Buyers, but subject to the terms and conditions of this
    Agreement, she shall be delivered and taken overas she
    was at the time of inspection, fair wear and tear
    excepted in brand new condition as is at the time of
    delivery of the Vessel to the Sellers by the Intermediate Seller
    and always in compliance with the Specifications and the
    Shipbuilding Contract and otherwise in accordance with
    clause 22. HoweverFurthermore, the Vessel
    shall be delivered with her class maintained without
    condition/recommendation*,save for any recommendation which
    customarily applies to newbuilding vessels free of average and
    damage affecting the Vessel’s class, and with her
    classification certificates and national and international
    certificates, as well as all other certificates the Vessel had
    at the time of inspection, delivery from the
    Builder, valid and unextended for 5 months (as always
    issued by the Builder) from the date the Vessel is delivered to
    the Buyers under this Agreement without
    condition/recommendation* by Class or the relevant authorities
    and save as provided in line 219 above and provided further that
    the Buyers shall accept the provisional certificates issued by
    the Class on delivery at the time of delivery
    “Inspection” in this Clause 11, shall mean the
    Buyers’ inspection according to Clause 4 a) or 4b), if
    applicable, or the Buyers’ inspection prior to the signing
    of this Agreement. If the Vessel is taken over without
    inspection, the date of this Agreement shall be the relevant
    date.




 


		
	
    12.  
	
    Name/markings





 



    Upon delivery the Buyers undertake to change the name of
    the Vessel and alter funnel markings. Please See
    clause 25.




 


		
	
    13.  
	
    Buyers’
    default





 



    Should the deposit not be paid in accordance with Clause 2,
    the Sellers have the right to cancel this Agreement, and they
    shall be entitled to claim compensation for their losses and for
    all expenses incurred together with interest. Should the
    Purchase Price not be paid in accordance with Clause 3, the
    Sellers have the right to cancel the Agreement, in which case
    the deposit together with interest earned shall be released to
    the Sellers. It the deposit does not cover their loss, the
    Sellers shall be entitled to claim further compensation for
    their losses and for all expenses incurred together with
    interest.




 


		
	
    14.  
	
    Sellers’
    default





 



    Should the Sellers fail to give Notice of Readiness in
    accordance with Clause 5 a) or fail to be ready to validly
    complete a legal transfer by the date stipulated in line 61 or
    should the Sellers be in breach of any of their obligations
    under clause 8 or 18 to 23 (inclusive), the Buyers shall
    have the option of cancelling this Agreement provided always
    that the Sellers shall be granted a maximum of 3 banking days
    after Notice of Readiness has been given to make arrangements
    for the documentation set out in Clause 8. If after Notice
    of Readiness has been given but before the Buyers have taken
    delivery, the Vessel ceases to be physically ready for delivery
    and is not made physically ready again in every respect by the
    date stipulated in line 61 and new Notice of Readiness given,
    the Buyers shall retain their option to cancel. In the event
    that the Buyers elect to cancel this Agreement the deposit
    together with interest earned shall be released to them
    immediately. Should the Sellers fail to give Notice of Readiness
    by the date stipulated in line 61 or fail to be ready to validly
    complete a legal transfer or are in breach of any of
    clauses 8 or 18 to 23 (inclusive) as foresaid they shall
    make due compensation to the Buyers for their loss and for all
    expenses together with interest if their failure is due to
    proven negligence and whether or not the Buyers cancel this
    Agreement.





 


		
	
    15.  
	
    Buyers’
    representatives – see
    clause 24
    






 



    After this Agreement has been signed by both parties and
    the deposit has been lodged, the Buyers have the right to place
    two representatives on board the Vessel at their sole risk and
    expenses upon arrival 



 

 


    * Notes, if any, in the surveyors report which are accepted
    by the Classification Society without condition/recommendation
    are not to be taken into account.













 







    
    at                    
    on or about
    [          ],
    provided however that the said representatives shall not be
    placed on the Vessel earlier than 3 weeks before the Vessel is
    to be delivered to the Buyers under this Agreement. These
    representatives are on board for the purpose of familiarization
    and in the capacity of observers only and they shall not
    interfere in any respect with the operation of the Vessel. The
    Buyers’ representative shall sign the Sellers’ letter
    of indemnity prior to their embarkation.




 


		
	
    16.  
	
    Arbitration





 



    a)* This Agreement shall be governed by and construed in
    accordance with English law and any dispute arising out of this
    Agreement shall be referred to arbitration in London in
    accordance with the Arbitration Acts 199650 and
    1979 or any statutory modification or re-enactment
    thereof for the time being in force, one arbitrator being
    appointed by each party. On the receipt by one party of the
    nomination in writing of the other party’s arbitrator, that
    party shall appoint their arbitrator within fourteen days,
    failing which the decision of the single arbitrator appointed
    shall apply. If two arbitrators are properly appointed they
    shall in turn appoint a third arbitrator and the three
    arbitrators will be deciding by majority and their majority
    decision will be final in the event the two arbitrators
    appointed by the parties hereto fail to agree on the appointment
    of the third arbitrator then the President of the Lloyds
    Maritime Arbitration Association at the relevant time shall be
    asked by either party hereto to appoint the third arbitrator
    shall not agree they shall appoint an umpire whose
    decision shall be final.





 



    b)* This Agreement shall be governed by and
    construed in accordance with Title 9 of the United States Code
    and the Law of the State of New York and should any dispute
    arise out of this Agreement, the matter in dispute shall be
    referred to three persons at New York, one to be appointed by
    each of the parties hereto, and the third by the two so chosen;
    their decision or that of any two of them shall be final, and
    for purpose of enforcing any award, this Agreement may be made a
    rule of the Court. The proceedings shall be conducted in
    accordance with the rules of the Society of Maritime
    Arbitrators, Inc. New York.





 



    c)* Any dispute arising out of this Agreement shall
    be referred to arbitrator
    at                    ,
    subject to the procedures applicable there. The laws
    of                    
    shall govern this Agreement.





 









 



    Clauses 17 to 30, inclusive, as attached, and form an
    integral part of this Agreement.




 

 


    * 16 a), 16 b) and 16 c) are alternatives; delete
    whichever is not applicable. In the absence of deletions.
    alternative 16 a) to apply.














 






 




    ADDITIONAL
    CLAUSES TO THE MEMORANDUM OF AGREEMENT DATED 3 MAY 2006
    BETWEEN QUINTANA MARITIME LIMITED AND POTOMAC SEAWAY CARRIERS
    CO.




 




    Clause 17



 



    The Buyers shall have the right to assign as security any of
    their rights under this Agreement to a bank or other financial
    institution providing the Buyers with finance in relation to the
    acquisition of the Vessel.



 




    Clause 18




 



    On or prior to the delivery of the Vessel under this Agreement,
    the Sellers undertake to assign to the Buyers all their rights,
    interest and title (a) under the relevant article of the
    Shipbuilding Contract dealing with the Vessel’s so called
    warranty of quality, (b) in any claims made thereunder
    outstanding at the time of such assignment and (c) under
    any other suppliers’ or equipment manufacturers’
    warranties that are available to the Sellers.




 



    The assignment of the rights described above, shall be effected
    by (a) the Sellers executing a deed in a form acceptable to
    the Buyers (the “Deed of Assignment”) and (b) the
    Builder, the Intermediate Seller or such other relevant supplier
    or manufacturer countersigning a notice of assignment again in
    form acceptable to the Buyers, such notice to be duly executed,
    provided however that in the event that the Builder or any
    supplier or manufacturer does not consent to the assignment of
    the relevant warranty, the Sellers hereby further undertake to
    act as the agent of the Buyers in raising, handling and closing
    any claims that the Buyers may want to raise under the said
    warranty always following the instruction of the Buyers. The
    Sellers shall not refuse any request by the Buyers to raise a
    claim under the said warranty of quality on the understanding
    that the Sellers shall not be liable to meet a claim if there is
    a failure to recover the same from the Builder or, as the case
    may be, the relevant supplier or manufacturer, provided however,
    that the Sellers shall, on the request of the Buyers, commence
    legal proceedings against the Builder or, as the case may be,
    supplier or manufacturer in connection with any disputed or
    non-recoverable claim made under the relevant warranty.



 



    The Sellers undertake with the Buyers that following the date of
    this Agreement, they shall:



 



    (a) at the Sellers expense, provide the Buyers with a true
    and complete certified copy of the Shipbuilding Contract and the
    Resale Agreement pursuant to which the Sellers have obtained the
    benefit of the relevant warranties as well as list of any claims
    made thereunder;



 



    (b) not in any manner vary, waive, surrender, assign to any
    person other than the Buyers or suspend any of their rights
    under the relevant warranties; and



 



    (c) advise the Buyers of any event that falls within any of
    the warranties to be assigned to the Buyers hereunder as well as
    of any claim made under the warranty in connection with such
    event or otherwise.



 



    Finally, the Sellers agree to draft the Deed of Assignment and
    to reflect the requirements of this clause 18 and any other
    matter reasonably required by the Buyers in relation thereto.



 




    Clause 19



 



    The Vessel is sold subject to the Charter which the Buyers have
    reviewed and accepted. The Sellers hereby undertake with the
    Buyers to (a) novate all their rights and obligations
    insofar as the Vessel is concerned under the Charter in favour
    of the Buyers on or prior the delivery of the Vessel to the
    Buyers and (b) procure that Metrostar and the Charterer
    agree such novation pursuant to a novation agreement to be
    entered among Metrostar (as agent for the Sellers), the
    Charterer, the Sellers and the Buyers (the “Novation
    Agreement”).




 



    The Sellers further undertake with the Buyers that terms of the
    Novation Agreement shall be acceptable to the Buyers and that
    they shall provide therein, inter alia but without prejudice to
    the generality of the foregoing, that any hire paid by the
    Charterer to the Sellers under the Charter in advance insofar as
    the Vessel is concerned in relation to a period of trading
    falling after the Vessel is delivered to the Sellers hereunder
    should be paid by the Sellers to the Buyers and that the Sellers
    shall remain responsible














 






    for any cargo claims or claims under the Charter insofar as the
    Vessel is concerned arising prior to the delivery of the Vessel
    to the Buyers hereunder.



 



    The Sellers further hereby undertake with the Buyers that
    following the date of this Agreement and until delivery of the
    Vessel to the Buyers under this Agreement, they will:



 



    (a) not, without the previous written consent of the Buyers:




 



    (i) agree to any variation of the Charter; or




 



    (ii) release the Charterer from any of the Charterer’s
    obligations under the Charter or waive any breach of the
    Charterer’s obligations thereunder or consent to any such
    act or omission of the Charterer as would otherwise constitute
    such breach: or



 



    (iii) determine the Charter for any reason whatsoever
    (including withdrawal of the Vessel under the Charter for
    non-payment of charter hire in accordance with the terms
    thereof); and



 



    (b) supply to the Buyers all information, accounts and
    records that may be necessary or of assistance to enable the
    Buyers to verify the amount of all payments of charterhire and
    any other amount payable under the Charter.



 



    The Sellers also undertake with the Buyers that:



 



    (a) they shall not, without first obtaining the Buyers
    prior written consent, reach any agreement, as contemplated by
    the terms of the Charter, with the Charterer as regards the
    daily charter hire rate to be applicable to the Vessel for a
    particular calendar year; and



 



    (b) any such agreement with the Charterer as regards the
    daily charter hire rate to be applicable to the Vessel for a
    particular calendar year, shall only be reached after the
    Sellers have received written instructions by the Buyers at what
    rate the Buyers wish the Sellers to conclude such an agreement
    with the Charterer; and



 



    (c) they shall (i) advise the Buyers as to the time
    and place of any meeting or telephone or video conference to
    take place with the Charterer as regards the daily charter hire
    rate to be applicable to the Vessel for a particular calendar
    year, (ii) provide the Charterer with any correspondence or
    other information relevant to such meeting or conference and the
    discussion to take place thereat and (ii) make arrangements
    for a representative of the Buyers to attend any such meeting or
    conference with the Charterer.



 



    Finally, the Sellers hereby represent and warrant to the Buyers
    that:



 



    (a) the Charter is free from all encumbrances and other
    interests and rights of every kind;



 



    (b) the executed original of the Charter to be delivered by
    the Sellers to the Buyers under this Agreement prior to the
    Vessel be is true and complete, the Charter constitutes the
    valid and binding obligations of the parties thereto enforceable
    in accordance with its terms, is in full force and effect and
    there have been no amendments or variations thereof or defaults
    thereunder from the date of this Agreement;




 



    (c) the Vessel has been delivered to and accepted by the
    Charterer for service under the Charter; and




 



    (d) there are no commissions, rebates, premiums or other
    payments in connection with the Charter other than as disclosed
    to the Buyers in writing prior to the date hereof.



 




    Clause 20



 



    At the Buyers’ request, the Sellers shall provide the
    Buyers with sufficient copies of their audited annual financial
    statements (which for the avoidance of doubt shall include a
    balance sheet, a profit and loss and a cash flow statement)
    prepared in accordance with International Accounting Standards
    and being for such period as requested by the Buyers.













 







    Clause 21



 



    To the extent that the Sellers or the Intermediate Seller
    receive the benefit of a reduction (the “reduction”)
    in the purchase price to be paid by either of them under their
    respective contracts by operation of the provisions of
    clause 18 of the Resale Agreement, then the Buyers would
    automatically be entitled to receive, in the Buyer’s
    option, either a reduction in the Purchase Price or a lump sum
    payment by the Sellers to the Buyers on delivery of the Vessel
    under this Agreement, in either case equal to the amount of the
    reduction.



 




    Clause 22



 



    (a) The Vessel shall be delivered to the Sellers in
    accordance with the Shipbuilding Contract, the Resale Agreement
    and the Specifications, as these may be amended
    and/or
    supplemented from time to time in accordance with the provisions
    of Clause 22(b) hereof.



 



    (b) The Sellers further hereby undertake that following the
    date of this Agreement and until delivery of the Vessel to the
    Buyers under this Agreement, they will:



 



    (i) not, without the previous written consent of the Buyers:




 



    (A) agree, nor permit the Intermediate Seller to agree, to
    any amendments, supplements or changes whatsoever to the
    Shipbuilding Contract, the Specifications, the Resale Agreement
    (whether or not the said amendments, supplements or changes are
    necessitated by change in Classification society rules and
    regulations) or any other document relating to the construction
    of the Vessel;





 



    (B) agree, nor permit the Intermediate Seller to agree, to
    any substitution of materials pursuant to the terms of
    Article V paragraph 3 of the Shipbuilding Contract;




 



    (C) release the Builder
    and/or the
    Intermediate Seller from any of their obligations under the
    Shipbuilding Contract
    and/or the
    Resale Agreement or waive any breach of the Builder’s
    and/or the
    Intermediate Seller’s obligations thereunder or consent to
    any such act or omission of the Builder or, as the case may be,
    the Intermediate Seller as would otherwise constitute such
    breach; or



 



    (D) terminate the Resale Agreement for any reason
    whatsoever other than in accordance with Clause 23 hereof.



 



    (c) Failure of the Sellers to comply with the terms of
    Clauses 22(a) or 22(b) shall constitute a Sellers’
    default and the provisions of Clause 14 hereof shall apply.



 




    Clause 23




 



    If for any reason whatsoever the Sellers become entitled under
    the Resale Agreement to terminate such agreement or to reject
    the Vessel, then the Sellers shall, before exercising such right
    of termination or rejection, advise in writing the Buyers of the
    existence thereof and shall act in relation to the said right(s)
    in accordance with the Buyers’ instructions. Within seven
    (7) Banking Days from receiving such advice the Buyers
    shall in turn advise the Sellers in writing:




 



    (i) if they wish the relevant agreement to be terminated
    or, as the case may be, the Vessel to be rejected. Upon such
    notice the deposit together with the interest earned shall be
    released immediately to the Buyers after which this Agreement
    shall be null and void; or




 



    (ii) if they do not wish the relevant agreement to be
    terminated or, as the case may be, the Vessel to be rejected, of
    the terms, if any, upon which the Buyers will be willing for the
    Sellers to continue the Resale Agreement or accept the Vessel.
    Upon receipt by the Sellers of the said notice and depending on
    the instructions contained therein, the Sellers would either
    (a) negotiate the terms on which delivery of the Vessel
    would be taken or the relevant agreement would be continued or
    (b) unconditionally continue the relevant agreement, take
    delivery of the Vessel and deliver the Vessel to the Buyers. In
    the event that the Builder or, as the case may be, the
    Intermediate Seller does not agree to the terms requested by the
    Buyers in their notice to the Sellers, then the Sellers, having
    first














 






    obtained the Buyers’ prior written consent, shall be
    entitled to terminate the Resale Agreement, or, as the case may
    be, reject the Vessel whereupon the provisions of
    sub-paragraph (i) shall apply.



 




    Clause 24



 



    As soon as the Buyers make the deposit provided under
    Clause 2 of this Agreement, the Sellers shall use their
    best endeavours to procure that the Buyers are allowed by the
    Builder to place an observer at the Shipyard until delivery of
    the Vessel hereunder to work along with the Seller’s
    supervision team stationed at the Shipyard. Such observer would
    be permitted to attend all work sites, inspections, tests, plan
    approvals, meetings, sea trials taking place at the Shipyard or
    at the Builder’s sub-contractors premise and, in general,
    to do anything else that a buyer’s representative is
    permitted to do under the terms of the Shipbuilding Contract as
    if the said observer was a member of the Seller’s team.
    Such observer shall not interfere directly with the Builder
    and/or with
    the construction process, but shall be entitled to raise
    comments with, or make observations to, the Seller’s
    supervision team which in turn shall be obliged to pass the same
    to the Builder for consideration. It is hereby understood that
    if, after having used their best endeavours, the Sellers fail to
    obtain the Builder’s consent to place a Buyer’s
    representative at the Shipyard in accordance with this
    Clause 24, then the Sellers would be absolved from
    arranging for a Buyer’s observer to attend the construction
    process of the Vessel.



 




    Clause 25



 



    It is hereby agreed that it will be for the Buyers and not for
    the Sellers to provide the name of the Vessel and the Sellers
    agree, subject to receiving adequate notice, that they will pass
    the Buyers’ proposed name to the Builder and arrange that
    the same is imprinted by the Builder on the Vessel’s hull
    and on the Vessel’s papers. To the extent the Builder
    requires any additional payment for making such imprints, then
    such payment shall be for the Buyers’ account.



 



    Subject to the Builder’s consent, the Sellers shall procure
    that any naming ceremony, as well as any delivery ceremony,
    relating to the Vessel is attended by the Buyers (as well as the
    Sellers) as if it were a ceremony arranged by the Builder for
    the Buyers’ guests and personnel.



 




    Clause 26



 



    The Sellers undertake with the Buyers to provide to the Buyers,
    promptly after receiving the same, a copy of all notices,
    demands, correspondence, documents, etc., received by the
    Sellers and or their agents, attorneys, employees under or in
    connection with the Shipbuilding Contract
    and/or the
    Resale Agreement.



 




    Clause 27



 



    Any and all notices and communications in connection with this
    Agreement shall be in English and addressed as follows:



 


		
	         	
    if to the Buyers at:




 



    Quintana Maritime Limited




    c/o Quintana Maritime LLC




    Pandoras 13 & Kyprou Street




    166 74 Glyfada




    Athens




    Greece



 



	 	 	 
	

    Fax number:
    


	
 
	
    210 8948 823
    

	

    Attn.:
    


	
 
	
    Mr. Stamatis Molaris
    










 












 





		
	         	
    if to the Sellers to:




 



    Potomac Seaway Carriers Co.





     c/o Metrostar Management Corp.






     35 Panepistimiou Street





     105 64 Athens




    Greece



 



	 	 	 
	

    Fax number:
    


	
 
	
    210 3212 687
    

	

    Attn:
    


	
 
	
    Mr. Achilleas Stergiou
    










 




    Clause 28



 



    The existence of this Agreement as well as the terms hereof
    should remain strictly private and confidential subject to any
    disclosure requirements imposed on QML by the
    U.S. Securities and Exchange Commission (“SEC”)
    or the rules of NASDAQ and subject further to the following
    paragraph of this Clause 28.




 



    The restriction imposed by this Clause 28 shall not apply
    in relation to a party to the extent (a) such party is
    required by law to disclose this Agreement and/or the
    circumstances surrounding it or (b) the relevant
    information has been disclosed to the public other than by a
    person who would had been subject to the confidentiality
    obligations imposed by this Clause 28 or (c) a party
    is required to disclose this Agreement
    and/or the
    terms thereof to its financiers, legal advisers, auditors etc.




 




    Clause 29




 



    The Sellers agree that QML is entitled to nominate one of its
    subsidiaries as the buyer of the Vessel (such subsidiary being
    called for the purposes of this Agreement, the
    “Nominee”) under this Agreement. It is further agreed
    between the Sellers and the Buyers that any such nomination is
    to be made by QML in writing at least 10 running dates before
    delivery of the Vessel and in connection therewith QML will also
    provide to the Sellers a copy of its letter nominating the
    Nominee as Buyers, which nomination shall be accepted by the
    Nominee countersigning such letter.




 



    Finally, it is hereby agreed between the parties thereto, that
    upon such nomination taking place the Nominee shall become the
    “Buyers” for the purposes of this Agreement and shall
    have all the rights and obligations QML had by signing this
    Agreement. QML will remain responsible for all the obligations
    the Buyers have under this Agreement, notwithstanding the
    nomination of the Nominee, provided however that, to the extent
    that the Nominee duly performs and discharges (or procures the
    performance and discharge of) the duties and liabilities
    undertaken by the Buyers in this Agreement, then such
    performance and discharge of the said duties and liabilities by
    the Nominee shall be deemed to be proper and due performance and
    discharge of QML’s duties and liabilities under this
    Agreement and the Sellers’ shall not be construed by virtue
    of the terms of this Clause 29 that they have the right to
    ask QML to perform again any duty or liability that has already
    been performed by the Nominee.



 




    Clause 30



 



    This Agreement is subject to QML raising the necessary funds for
    acquiring the Vessel and 16 other vessels it has agreed to
    purchase from affiliates of the Sellers, and declaring its
    success in achieving so not later than 10 May 2006.



 



    Should QML not declare its success to the Sellers in accordance
    with this Clause 30, the deposit together with the interest
    earned shall be released immediately to the Buyers, after which
    this Agreement shall be null and void.













 






    IN WITNESS WHEREOF the parties hereto have caused this Agreement
    to be duly executed on the day and year first written above.



 



    /s/  ACHILLEAS
    STERGIOU













    Signed for and on behalf of









    POTOMAC SEAWAY CARRIERS CO.









    by



 



    /s/  NIKOS
    FRANTZESKAKIS













    Signed for and on behalf of









    QUINTANA MARITIME LIMITED









    by









    its Chief Commercial Officer and Chief Operating Officer