Exhibit 10.2


 


	
  

  
	
   

  
	
   

  
	
   

  
	
  FORM OF

  
	
   

  
	
  OMNIBUS AGREEMENT

  
	
   

  
	
   

  
	
  AMONG

  
	
   

  
	
   

  
	
  CAPITAL MARITIME & TRADING CORP.

  
	
   

  
	
   

  
	
  CAPITAL GP L.L.C.

  
	
   

  
	
   

  
	
  CAPITAL PRODUCT OPERATING L.L.C.

  
	
   

  
	
   

  
	
  AND

  
	
   

  
	
   

  
	
  CAPITAL PRODUCT PARTNERS L.P.

  
	
   

  
	
   

  
	
   

  
	
   

  
	
   

  
	
   

  



 

















 


TABLE OF CONTENTS


 


	
   

  	
   

  	
   

  	
  Page

  
	
  ARTICLE I

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Definitions

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 1.1. Definitions

  	
   

  	
  4

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE II

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Medium Range Tanker Restricted Business
  Opportunities

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 2.1. Medium Range Tanker Restricted
  Businesses

  	
  8

  
	
  SECTION 2.2.
  Permitted Exceptions

  	
   

  	
  8

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE III

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Non-Medium Range Tanker Restricted Business
  Opportunities

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 3.1.
  Non-Medium Range Tanker Restricted Businesses

  	
   

  	
  10

  
	
  SECTION 3.2.
  Permitted Exceptions

  	
   

  	
  10

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE IV

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Business Opportunities Procedures

  	
   

  	
   

  
	
   

  
	
  SECTION 4.1.
  Procedures

  	
   

  	
  11

  
	
  SECTION 4.2.
  Scope Of Prohibition

  	
   

  	
  13

  
	
  SECTION 4.3.
  Enforcement

  	
   

  	
  13

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE V

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Rights Of First Offer

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 5.1.
  Rights Of First Offer

  	
   

  	
  14

  
	
  SECTION 5.2.
  Procedures For Rights Of First Offer

  	
   

  	
  14

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VI

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Indemnification

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 6.1.
  Capital Maritime Indemnification

  	
   

  	
  15

  
	
  SECTION 6.2.
  Limitation Regarding Indemnification

  	
   

  	
  15

  
	
  SECTION 6.3.
  Indemnification Procedures

  	
   

  	
  15

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VII

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Miscellaneous

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 7.1.
  Choice Of Law; Submission To Jurisdiction

  	
   

  	
  17

  
	
  SECTION 7.2.
  Notice

  	
   

  	
  17

  
	
  SECTION 7.3.
  Entire Agreement

  	
   

  	
  17

  
	
  SECTION 7.4.
  Termination

  	
   

  	
  17

  
	
  SECTION 7.5.
  Waiver; Effect Of Waiver Or Consent

  	
   

  	
  17

  
	
  SECTION 7.6.
  Amendment Or Modification

  	
   

  	
  18

  
	
  SECTION 7.7.
  Assignment

  	
   

  	
  18

  
	
  SECTION 7.8.
  Counterparts

  	
   

  	
  18

  
	
  SECTION 7.9.
  Severability

  	
   

  	
  18

  
	
  SECTION 7.10.
  Gender, Parts, Articles And Sections

  	
   

  	
  18

  
	
  SECTION 7.11.
  Further Assurances

  	
   

  	
  18

  
	
  SECTION 7.12.
  Withholding Or Granting Of Consent

  	
   

  	
  18

  
	
  SECTION 7.13.
  Laws And Regulations

  	
   

  	
  19

  
	
  SECTION 7.14.
  Negotiation Of Rights Of Capital Maritime, Limited Partners, Assignees, And
  Third Parties

  	
   

  	
  19

  



 


i

















 


OMNIBUS AGREEMENT


 


THIS
OMNIBUS AGREEMENT is entered into on, and effective as of, the Closing Date (as
defined herein), among Capital Maritime & Trading Corp., a Marshall Islands
corporation (“Capital Maritime”), Capital GP L.L.C., a Marshall Islands
limited liability company (including any permitted successors and assigns under
the MLP Agreement (as defined herein), the “General Partner”), Capital
Product Operating L.L.C., a Marshall Islands limited liability company (the “OLLC”),
and Capital Product Partners L.P., a Marshall Islands limited partnership (the
“MLP”).


 


R E C I T A L S:


 


1.             The Parties desire by
their execution of this Agreement to evidence their understanding, as more
fully set forth in Articles II and IV, with respect to (a) those
business opportunities that the Capital Maritime Entities (as defined herein)
will not pursue during the term of this Agreement and (b) the procedures
whereby such business opportunities are to be offered to the Partnership Group
(as defined herein) and accepted or declined.


 


2.             The Parties desire by
their execution of this Agreement to evidence their understanding, as more
fully set forth in Articles III and IV, with respect to (a) those
business opportunities that the Partnership Group will not pursue during the
term of this Agreement and (b) the procedures whereby such business
opportunities are to be offered to Capital Maritime and accepted or declined.


 


3.             The Parties desire by
their execution of this Agreement to evidence their understanding, as more
fully set forth in Article V, with respect to (a) Capital Maritime’s
right of first offer relating to certain Medium Range Tanker Assets (as defined
herein) and (b) the MLP’s right of first offer relating to certain Medium
Range Tanker Assets that Capital Maritime might own.


 


4.             The Parties desire by
their execution of this Agreement to evidence their understanding, as more
fully set forth in Article VI, with respect to certain indemnification
obligations of Capital Maritime.


 


In
consideration of the premises and the covenants, conditions, and agreements
contained herein, and for other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the parties hereto hereby
agree as follows:


 


3

















 


ARTICLE
I


 


Definitions


 


SECTION 1.1. 
Definitions.  As used in
this Agreement, the following terms shall have the respective meanings set
forth below:


 


“Acquiring
Party” has the meaning given such term in Section 4.1(a).


 


“Affiliate”
means, with respect to any Person, any other Person that directly or indirectly
through one or more intermediaries controls, is controlled by or is under
common control with, the Person in question. 
As used herein, the term “control” means the possession, direct
or indirect, of the power to direct or cause the direction of the management
and policies of a Person, whether through ownership of voting securities, by
contract or otherwise.


 


“Agreement”
means this Omnibus Agreement, as it may be amended, modified, or supplemented
from time to time in accordance with Section 7.6 hereof.


 


“Board”
means the Board of Directors of the MLP.


 


“Break-up
Costs” means the aggregate amount of any and all additional taxes, flag
administration, financing, legal and other similar costs (except with respect
to Section 2.2(b)(i) where Break-up Costs shall be deemed to include only
administrative costs associated with transfer and re-flagging, including
related legal costs) to (a) the Capital Maritime Entities that would be
required to transfer Medium Range Tanker Assets acquired by the Capital Maritime
Entities as part of a larger transaction to a Partnership Group Member pursuant
to Section 2.2(b)(i) or 2.2(c), or (b) the Partnership Group that
would be required to transfer Non-Medium Range Tanker Assets acquired by the
Partnership Group as part of a larger transaction to a Capital Maritime Entity
pursuant to Section 3.2(b).


 


“Capital
Maritime Entities” means Capital Maritime and any Person controlled,
directly or indirectly, by Capital Maritime other than the Partnership
Entities.


 


“Change of
Control” means, with respect to any Person (the “Applicable Person”),
any of the following events:  (a) any
sale, lease, exchange or other transfer (in one transaction or a series of
related transactions) of all or substantially all of the Applicable Person’s
assets to any other Person, unless immediately following such sale, lease,
exchange or other transfer such assets are owned, directly or indirectly, by
the Applicable Person; (b) the consolidation or merger of the Applicable Person
with or into another Person pursuant to a transaction in which the outstanding
Voting Securities of the Applicable Person are changed into or exchanged for
cash, securities or other property, other than any such transaction where (i)
the outstanding Voting Securities of the Applicable Person are changed into or
exchanged for Voting Securities of the surviving Person or its parent and (ii)
the holders of the Voting Securities of the Applicable Person immediately prior
to such transaction own, directly or indirectly, not less than a majority of
the outstanding Voting Securities of the surviving Person or its parent
immediately


 


4

















 


after such
transaction; and (c) a “person” or “group” (within the meaning of
Sections 13(d) or 14(d)(2) of the Exchange Act), other than Capital Maritime or
its Affiliates with respect to the General Partner, being or becoming the “beneficial
owner” (as defined in Rules 13d-3 and 13d-5 under the Exchange Act)of more
than 50% of all of the then outstanding Voting Securities of the Applicable
Person, except in a merger or consolidation which would not constitute a Change
of Control under clause (b) above.


 


“Closing
Date” means the date of the closing of the initial public offering of
common units representing limited partner interests in the MLP.


 


“Conflicts
Committee” means the Conflicts Committee of the Board of Directors of the
MLP.


 


“Contribution
Assets” has the meaning given such term in Section 6.1.


 


“Control”
means the possession, direct or indirect, of the power to direct or cause the
direction of the management and policies of a Person, whether through ownership
of voting securities, by contract or otherwise.


 


“Covered
Environmental Losses” means all Losses suffered or incurred by the
Partnership Group by reason of, arising out of or resulting from:


 


(i) any violation or correction of violation of
Environmental Laws; or


 


(ii) any event or condition relating to
environmental or human health and safety matters, in each case, associated with
the ownership or operation by the Capital Maritime Entities of the Contribution
Assets (including, without limitation, the presence of Hazardous Substances on,
under, about or migrating to or from the Contribution Assets or the disposal or
release of, or exposure to, Hazardous Substances generated by or otherwise
related to operation of the Contribution Assets), including, without
limitation, (a) the cost and expense of any investigation, assessment,
evaluation, monitoring, containment, cleanup, repair, restoration, remediation
or other corrective action required or necessary under Environmental Laws,
(b) the cost or expense of the preparation and implementation of any
closure, remedial, corrective action or other plans required or necessary under
Environmental Laws and (c) the cost and expense for any environmental or
toxic tort (including, without limitation, personal injury or property damage
claims) pre-trial, trial or appellate legal or litigation support work;


 


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


 


“Environmental
Laws” means all international, federal, state, foreign and local laws,
statutes, rules, regulations, treaties, conventions, orders, judgments and
ordinances relating to protection of natural resources, health and safety and
the environment, each in effect and as amended through the Closing Date.


 


5

















 


“Event of
Loss” means any of the following events:  (a) the actual or
constructive total loss of a  Non-Medium
Range Tanker or the agreed or compromised total loss of a  Non-Medium Range Tanker; (b) the
destruction of a Non-Medium Range Tanker; (c) the damage to a Non-Medium
Range Tanker to an extent (determined in good faith by the Board within 90 days
after the occurrence of such damage) as shall make repair thereof uneconomical
or shall render such Non-Medium Range Tanker permanently unfit for normal use
(other than obsolescence); or (d) the condemnation, confiscation,
requisition, seizure, forfeiture or other taking of title to or use of a
Non-Medium Range Tanker that shall not be revoked within six months.  An Event of Loss shall be deemed to have
occurred:  (i) in the event of the destruction or other actual
total loss of a Non-Medium Range Tanker, on the date of such loss; (ii) in
the event of a constructive, agreed or compromised total loss of a Non-Medium
Range Tanker, on the date of determination of such total loss pursuant to the
relevant insurance policy; (iii) in the case of any event referred to in
clause (c) above, upon such determination by the Board; or (iv) in the
case of any event referred in clause (d) above, on the date six months
after the occurrence of such event.


 


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


 


“First
Offer Negotiation Period” has the meaning given such term in
Section 5.2.


 


“General
Partner” is defined in the introduction to this Agreement.


 


“Hazardous
Substances” means (a) substances defined in or regulated under
applicable Environmental Laws; (b) petroleum and petroleum products,
including crude oil and any fractions thereof; (c) natural gas, synthetic
gas and any mixtures thereof; (d) any substances with respect to which a
federal, state, foreign or local agency requires environmental investigation,
monitoring, reporting or remediation; (e) any hazardous waste or solid
waste, within the meaning of any Environmental Law; (f) any solid,
hazardous, dangerous or toxic chemical, material, waste or substance, within
the meaning of and regulated by any Environmental Law; (g) any radioactive
material; and (h) any asbestos-containing materials.


 


“Losses”
means losses, damages, liabilities, claims, demands, causes of action,
judgments, settlements, fines, penalties, costs and expenses (including,
without limitation, court costs and reasonable attorneys’ and experts’ fees) of
any and every kind or character; provided, however, that such
term shall not include any special, indirect, incidental or consequential
damages.


 


“Medium
Range Tanker” means any product tanker with a carrying capacity of
30,000-55,000 dwt.


 


“Medium
Range Tanker Assets” means any Medium Range Tanker and its related charter.


 


“MLP”
is defined in the introduction to this Agreement.


 


6

















 


“MLP
Agreement” means the First Amended and Restated Agreement of Limited
Partnership of the MLP, dated as of the Closing Date, as such agreement is in
effect on the Closing Date, to which reference is hereby made for all purposes
of this Agreement.  No amendment or
modification to the MLP Agreement subsequent to the Closing Date shall be given
effect for purposes of this Agreement unless consented to by each of the
Parties to this Agreement.


 


“Non-Medium
Range Tanker” means (i) any tanker other than a product tanker with a
carrying capacity of 30,000-55,000 dwt, or (ii) any Medium Range Tanker not
subject to a Qualifying Contract.


 


“Non-Medium
Range Tanker Assets” means any Non-Medium Range Tanker and its related
charter.


 


“Offer”
has the meaning given such term in Section 4.1.


 


“Offered
Assets” has the meaning given such term in Section 4.1.


 


“Offeree”
has the meaning given such term in Section 4.1.


 


“Offer
Period” has the meaning given such term in Section 4.1.


 


“OLLC”
is defined in the introduction to this Agreement.


 


“Qualifying
Contract” means a time or bareboat charter with a remaining duration,
excluding any extension options, of at least two years.


 


“Parties”
means the parties to this Agreement and their successors and permitted assigns.


 


“Partnership
Entities” means the General Partner, the MLP, the OLLC and any Person
controlled by any such entity.


 


“Partnership
Group” means the MLP, the OLLC and any Person controlled by any such
entity.


 


“Partnership
Group Member” means any Person in the Partnership Group.


 


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


 


“Potential
Transferee” has the meaning given such term in Section 5.2.


 


“Re-Charter”
means the charter of a Medium Range Tanker pursuant to a Qualifying Contract in
the event that its existing charter expires or is terminated early.


 


“Replacement
Non-Medium Range Tanker” means any non-medium range tanker that replaces
any Non-Medium Range Tanker upon an Event of Loss.


 


7

















 


“Sale
Assets” has the meaning given such term in Section 5.2.


 


“Transfer”
means any transfer, assignment, sale or other disposition of any Medium Range
Tanker by a Capital Maritime Entity or of any Non-Medium Range Tanker by a
Partnership Group Member; provided, however, that such term shall
not include:  (a) transfers, assignments, sales or other
dispositions from a Capital Maritime Entity to another Capital Maritime Entity,
or from a Partnership Group Member to another Partnership Group Member;
(b) transfers, assignments, sales or other dispositions pursuant to the
terms of any related charter or other agreement with a charter party;
(c) transfers, assignments, sales or other dispositions pursuant to
Article II or III of this Agreement; or (d) grants of security interests
in or mortgages or liens on such Medium Range Tanker Assets or Non-Medium Range
Tanker Assets in favor of a bona fide third party lender (but not the
foreclosing of any such security interest, mortgage or lien).


 


“Transfer
Notice” has the meaning given such term in Section 5.2.


 


“Transferring
Party” has the meaning given such term in Section 5.2.


 


“Voting
Securities” means securities of any class of Person entitling the holders
thereof to vote in the election of members of the board of directors or other
similar governing body of the Person.


 


ARTICLE
II


 


Medium
Range Tanker Restricted B usiness Opportunities


 


SECTION 2.1. 
Medium Range Tanker Restricted Businesses.  Subject to Section 7.4 and except as
permitted by Section 2.2, each of the Capital Maritime Entities shall be
prohibited from acquiring, owning or operating Medium Range Tankers under
Qualifying Contracts.


 


SECTION 2.2. 
Permitted Exceptions. 
Notwithstanding any provision of Section  2.1 to the contrary, the
Capital Maritime Entities may engage in the following activities under any of
the following circumstances:


 


(a) acquiring, owning, chartering or
operating Medium Range Tankers that are not subject to a Qualifying Contract;


 


(b) (i)
acquiring one or more Medium Range Tankers that are subject to Qualifying
Contracts after the date of this Agreement if the Capital Maritime Entity
offers to sell to the Partnership Group Members each such Medium Range Tanker
Asset for the acquisition price at the time it is acquired plus any applicable
Break-up Costs, in accordance with the procedures set forth in
Section 4.1; or (ii) putting a Medium Range Tanker that the Capital
Maritime Entity owns or operates under a Qualifying Contract if the Capital Maritime
Entity offers to sell to the Partnership Group Members each such Medium Range
Tanker for its fair market value at the


 


8

















 


time it is
made subject to a Qualifying Contract and, in each case, at each renewal or extension
of that Qualifying Contract, in accordance with the procedures set forth in
Section 4.1;


 


(c) acquiring one or more Medium Range
Tankers that are subject to Qualifying Contracts as part of the acquisition of
a controlling interest in a business or package of assets and owning and
operating or chartering those Medium Range Tanker Assets provided, however,
that:


 


(i) if less than a majority of the value of
the total assets or business acquired is attributable to those Medium Range
Tanker Assets, as determined in good faith by the board of directors of Capital
Maritime, the Capital Maritime Entity must offer to sell to the Partnership
Group Members such Medium Range Tanker Assets for fair market value plus any
applicable Break-up Costs in accordance with the procedures set forth in
Section 4.1.


 


(ii) if a majority or more of the value of
the total assets or business acquired is attributable to those Medium Range
Tanker Assets, as determined in good faith by the board of directors of Capital
Maritime; Capital Maritime shall notify the MLP in writing, of the proposed
acquisition. The MLP shall, not later than the 10th calendar day following
receipt of such notice, notify Capital Maritime if any of the Partnership Group
Members wish to acquire the Medium Range Tanker Assets forming part of the
business or package of assets in cooperation and simultaneously with Capital
Maritime acquiring the Non-Medium Range Tanker Assets forming part of that
business or package of assets.  If the
MLP does not notify Capital Maritime of its intent to pursue the acquisition
within 10 calendar days, Capital Maritime 
may proceed with the acquisition as provided in subsection (i) above.


 


(d) acquiring a non-controlling interest in
any company, business or pool of assets;


 


(e) acquiring, owning or operating the Medium
Range Tanker Assets subject to the Agreement to Purchase Future Vessels dated
as of     , 2007, between Capital Maritime and the MLP if
the MLP fails to purchase (or to cause other Partnership Group Members to purchase)
such Medium Range Tanker Assets under such agreement;


 


(f) acquiring, owning or operating Medium
Range Tankers subject to a Qualifying Contract that are subject to an
offer to purchase by a Capital Maritime Entity as described in
Section 2.2(b) and (c), in each case (i) pending the applicable offer of
such Medium Range Tanker Asset to the Partnership Group Members and the
Partnership Group Members’ determination pursuant to Section 4.1 whether
to purchase the Medium Range Tanker Assets and, if the Partnership Group
Members determine to purchase such Medium Range Tanker Asset, pending the
closing of


 


9

















 


such purchase; or (ii) if the Board has
elected to cause any Partnership Group Member to acquire or operate such Medium
Range Tanker Assets;


 


(g) providing ship management services
relating to any vessel whatsoever, including to Medium Range Tanker Assets,
owned by any Capital Maritime Entity; or


 


(h) acquiring, operating or chartering Medium
Range Tankers that are subject to Qualifying Contracts if the Board has
previously advised Capital Maritime that it consents to such acquisition,
operation or charter.


 


ARTICLE
III


 


Non-Medium
Range Tanker Restricted Business Opportunities


 


SECTION 3.1. 
Non-Medium Range Tanker Restricted Businesses.  Subject to Section 7.4 and except as
permitted by Section 3.2, each Partnership Group Member shall be prohibited
from acquiring, owning or operating or chartering Non-Medium Range Tankers.


 


SECTION 3.2. 
Permitted Exceptions. 
Notwithstanding any provision of Section  3.1 to the contrary, the
Partnership Group Members may engage in the following activities under any of
the following circumstances:


 


(a) owning, chartering or operating any
Non-Medium Range Tanker Assets so owned, operated or chartered at the date of
this Agreement, including any Replacement Non-Medium Range Tanker;


 


(b) acquiring one or more Non-Medium Range
Tanker Asset as part of the acquisition of a controlling interest in a business
or package of assets and owning and operating or chartering those vessels,
provided, however, that:


 


(i) if less than a majority of the value of
the total assets or business acquired is attributable to Non-Medium Range
Tanker Assets, as determined in good faith by the MLP, the Partnership Group
Member must offer to sell such Non-Medium Range Tanker Assets and related
charters to Capital Maritime or any other Capital Maritime Entity for their
fair market value plus any applicable Break-up Costs in accordance with the
procedures set forth in Section 4.1.


 


(ii) if a majority or more of the value of
the total assets or business acquired is attributable to Non-Medium Range
Tanker Assets, as determined in good faith by the MLP; the Partnership Group
Members shall notify Capital Maritime in writing of the proposed acquisition.
Capital Maritime shall, not later than the 10th calendar day following receipt
of such notice, notify the Partnership Group Members if it or any


 


10

















 


other Capital Maritime Entity wishes to
acquire the Non-Medium Range Tanker Assets forming part of the business or
package of assets in cooperation and simultaneously with the Partnership Group
Members acquiring the Medium Range Tanker Assets forming part of that business
or package of assets. If Capital Maritime does not notify the Partnership Group
Member of its intent to pursue the acquisition within 10 calendar days, the
Partnership Group Member may proceed with the acquisition as provided in
subsection (i) above.


 


(c) acquiring a non-controlling interest in
any company, business or pool of assets;


 


(d) owning, operating or chartering any
Non-Medium Range Tanker Assets that are subject to an offer to purchase by
Capital Maritime as described in Section 3.2(b) pending the applicable
offer of such Non-Medium Range Tanker Assets to Capital Maritime and Capital
Maritime’s determination pursuant to Section 4.1 whether to purchase the
Non-Medium Range Tanker Assets and, if Capital Maritime elects to purchase or
cause any Capital Maritime Entity to purchase such Non-Medium Range Tanker
Assets, pending the closing of such purchase; and


 


(e) acquiring, operating or chartering
Non-Medium Range Tankers if Capital Maritime has previously advised the MLP
that it consents to such acquisition, operation or charter.


 


ARTICLE
IV


 


Business
Opportunities Procedures


 


SECTION 4.1. 
Procedures.  In the event
that (a) a Partnership Group Member acquires Non-Medium Range Tanker
Assets in accordance with Section 3.2(b), or (b) a Capital Maritime Entity
acquires Medium Range Tanker Assets in accordance with Section 2.2(b) or
(c)(i), then (i) simultaneously or in any event not later than 30 calendar
days after the consummation of the acquisition (in the case of clause (a) or
(b) above), such acquiring Party (the “Acquiring Party”) shall
notify (a) Capital Maritime, in the case of an acquisition by a
Partnership Group Member or (b) the Board, in the case of an acquisition
by a Capital Maritime Entity and offer such party to be notified (each an “Offeree”)
the opportunity for any Capital Maritime Entity or Partnership Group Member, as
applicable, to purchase such Non-Medium Range Tanker Assets or Medium Range
Tanker Assets, as applicable (the “Offered Assets”), for their fair
market value (or, in the case of an acquisition in accordance with Section
2.2(b)(i), the acquisition price) (plus, in the case of an acquisition in
accordance with Section 2.2(b)(i) or 2.2(c) or 3.2(b), any applicable Break-up
Costs), in each case on commercially reasonable terms in accordance with this
Section (the “Offer”).  The Offer
shall set forth the Acquiring Party’s proposed terms relating to the purchase
of the Offered Assets by the applicable Capital Maritime Entity or Partnership
Group Member,


 


11

















 


including any liabilities to be assumed by the applicable Capital
Maritime Entity or Partnership Group Member as part of the Offer.  As soon as practicable after the Offer is
made, the Acquiring Party will deliver to the Offeree all information prepared
by or on behalf of or in the possession of such Acquiring Party relating to the
Offered Assets and reasonably requested by the Offeree.  As soon as practicable, but in any event,
within 30 calendar days after receipt of such notification, the Offeree shall
notify the Acquiring Party in writing that either:


 


(a) Capital Maritime has elected not to
purchase (or not to cause any of its permitted Affiliates to purchase) or the
Board has elected not to cause any Partnership Group Member to purchase, as
applicable, such Offered Assets, in which event the Acquiring Party and its
Affiliates shall, subject to the other terms of this Agreement (including
Section 2.2(b)(ii)), be forever free, subject to the provisions of this
Agreement, to continue to own, operate and charter such Offered Assets; or


 


(b) Capital Maritime has elected to purchase
(or to cause any of its permitted Affiliates to purchase) or the Board has
elected to cause any Partnership Group Member to purchase, as applicable, such
Offered Assets, in which event the following procedures shall be followed:


 


(i) After the receipt of the Offer by the
Offeree, the Acquiring Party and the Offeree shall negotiate in good faith, the
fair market value (and any applicable Break-up Costs), of the Offered Assets
that are subject to the Offer and the other terms of the Offer on which the
Offered Assets will be sold to the applicable Capital Maritime Entity or
Partnership Group Member.  If the
Acquiring Party and the Offeree agree on the fair market value (and any
applicable Break-up Costs), of the Offered Assets that are subject to the Offer
and the other terms of the Offer during the 30-day period (the “Offer Period”)
after receipt by the Acquiring Party of Capital Maritime’s election to purchase
(or election to cause any of its permitted Affiliates to purchase) or of the
Board’s election to cause any Partnership Group Member to purchase, as
applicable, the Offered Assets, Capital Maritime shall purchase (or cause any
of its permitted Affiliates to purchase) or the Board shall cause any
Partnership Group Member to purchase, as applicable, the Offered Assets on such
terms as soon as commercially practicable after such agreement has been
reached.


 


(ii) If the Acquiring Party and the Offeree
are unable to agree on the fair market value (and any applicable Break-up
Costs), of the Offered Assets that are subject to the Offer or on any other
terms of the Offer during the Offer Period, the Acquiring Party and the Offeree
will engage an independent ship broker and/or an independent investment banking
firm prior to the end of the Offer Period to determine the fair market value
(and any applicable Break-up Costs), of the Offered Assets and/or the other
terms on which the Acquiring Party and the Offeree are unable to agree.  In determining the fair market value of the
Offered Assets and


 


12

















 


other terms on which the Offered Assets are
to be sold, the ship broker or investment banking firm, as applicable, will
have access to the proposed sale and purchase values and terms for the Offer
submitted by the Acquiring Party and the Offeree, respectively, and to all
information prepared by or on behalf of the Acquiring Party relating to the
Offered Assets and reasonably requested by such ship broker or investment
banking firm.  Such ship broker or
investment banking firm will determine the fair market value (and any
applicable Break-up Costs) of the Offered Assets and/or the other terms on which
the Acquiring Party and the Offeree are unable to agree within 30 calendar days
of its engagement and furnish the Acquiring Party and the Offeree its
determination.  The fees and expenses of
the ship broker or investment banking firm, as applicable, will be divided
equally between the Acquiring Party and the Offeree.  Upon receipt of such determination, the
Offeree will have the option, but not the obligation:


 


(A) in the case that the Offeree is Capital Maritime,
to purchase or cause any of its permitted Affiliates to purchase, or in the case
that the Offeree is the Board, to cause any Partnership Group Member to
purchase the Offered Assets for the fair market value (and any applicable
Break-up Costs), and on the other terms determined by the ship broker or
investment banking firm, as soon as commercially practicable after
determinations have been made; or


 


(B) in the case that the Offeree is Capital Maritime,
to elect not to cause any of its permitted Affiliates to purchase, or in the
case that the Offeree is the Board, not to cause any Partnership Group Member
to purchase such Offered Assets, in which event the Acquiring Party and its
Affiliates shall, subject to the other terms of this Agreement, be forever free
to continue to own and operate such Offered Assets.


 


SECTION 4.2. 
Scope Of Prohibition.  If
any Party or its Affiliates engages in the ownership or operation of Medium
Range Tankers under Qualifying Contract in the case of a Capital Maritime
Entity, or Non-Medium Range Tankers in the case of a Partnership Group Member,
pursuant to any of the exceptions described in Section 2.2 or 3.2, as
applicable, the Party and its Affiliates may not subsequently expand that
portion of their business other than pursuant to the exceptions contained in
such Section 2.2 or 3.2.  Except as
otherwise provided in this Agreement or the MLP Agreement, each party and its
Affiliates shall be free to engage in any business activity whatsoever,
including those that may be in direct competition with the Capital Maritime
Entities or the Partnership Group.


 


SECTION 4.3. 
Enforcement.  Each Party
agrees and acknowledges that the other Parties do not have an adequate remedy
at law for the breach by any such Party of its covenants and agreements set
forth in this Article IV, and that any breach by any


 


13

















 


such Party of its covenants and agreements set forth in this Article IV
would result in irreparable injury to such other Parties.  Each Party further agrees and acknowledges
that any other Party may, in addition to the other remedies which may be
available to such other Party, file a suit in equity to enjoin such Party from
such breach, and consent to the issuance of injunctive relief to enforce the
provisions of Article IV of this Agreement.


 


ARTICLE
V


 


Rights
Of First Offer


 


SECTION 5.1. 
Rights Of First Offer. 
(a)  The Partnership Group hereby
grants Capital Maritime a right of first offer on any proposed Transfer by any
Partnership Group Member of any Medium Range Tanker Assets or any Non-Medium
Range Tanker Assets owned or acquired by any Partnership Group Member.  The Capital Maritime Entities hereby grant
the MLP a right of first offer on any proposed Transfer or Re-Charter of
any Medium Range Tanker Assets owned or acquired by any Capital Maritime
Entity.


 


(b)   The
Parties acknowledge that all potential Transfers or Re-Charter of Medium
Range Tanker Assets pursuant to this Article V are subject to obtaining any and
all written consents of governmental authorities and other non-affiliated third
parties and to the terms of all existing agreements in respect of such Medium
Range Tanker Assets, as applicable.


 


SECTION 5.2. 
Procedures For Rights Of First Offer.  In the event that a Partnership Group Member
or a Capital Maritime Entity (as applicable, the “Transferring Party”)
proposes to Transfer or Re-Charter any Medium Range Tanker Assets (the “Sale
Assets”), prior to engaging in any negotiation for such Transfer with any
non-affiliated third party or otherwise offering to Transfer the Sale Assets to
any non-affiliated third party, such Transferring Party shall give Capital
Maritime or the MLP, as applicable (the “Potential Transferee”), written
notice setting forth all material terms and conditions (including, without
limitation, the purchase price (in the event of a Transfer) or the terms of the
charter agreement (in the event of a Re-Charter) and a description of the Sale
Asset(s) on which such Transferring Party desires to Transfer or Re-Charter the
Sale Assets (the “Transfer Notice”). 
The Transferring Party then shall be obligated to negotiate in good
faith for a 10-day period following the delivery by the Transferring Party of
the Transfer Notice (the “First Offer Negotiation Period”) to reach an
agreement for the Transfer or Re-Charter of such Sale Assets to the Potential
Transferee or any of its Affiliates on the terms and conditions set forth in
the Transfer Notice.  If no such
agreement with respect to the Sale Assets is reached during the First Offer
Negotiation Period, and the Transferring Party has not Transferred, or agreed
in writing to Transfer, such Sale Assets to a third party within 180 calendar
days after the end of the First Offer Negotiation Period on terms generally no
less favorable to the Transferring Party than those include in the Transfer Notice,
then the Transferring Party shall not thereafter Transfer any of the Sale
Assets without first offering such assets to the applicable Potential
Transferee in the manner provided above.


 


14

















 


ARTICLE
VI


 


Indemnification


 


SECTION 6.1. 
Capital Maritime Indemnification. 
Subject to the provisions of Section  6.2 and Section 6.3, Capital
Maritime shall indemnify, defend and hold harmless the Partnership Group from
and against:


 


(a) any Covered Environmental Losses relating
to the assets contributed by the Capital Maritime Entities to the Partnership
Group prior to or on the Closing Date (the “Contribution Assets”) to the
extent that Capital Maritime is notified by the MLP of any such Covered
Environmental Losses within five (5) years after the Closing Date;
(b) Losses to the Partnership Group arising from (i) the failure of
the Partnership Group, immediately after the Closing Date, to be the owner of
such valid leasehold interests or fee ownership interests in and to the
Contribution Assets as are necessary to enable the Partnership Entities to own
and operate the Contribution Assets in substantially the same manner that the
Contribution Assets were owned and operated by the Capital Maritime Entities
immediately prior to the Closing Date or (ii) the failure of the
Partnership Entities to have by the Closing Date any consent or governmental
permit necessary to allow the Partnership Entities to own or operate the
Contribution Assets in substantially the same manner that the Contribution
Assets were owned and operated by the Capital Maritime Entities immediately
prior to the Closing Date, in each of clauses (i) and (ii) above, to
the extent that Capital Maritime is notified by the MLP of such Losses within three
(3) years after the Closing Date; and (d) all federal, state, foreign and
local income tax liabilities attributable to the operation of the Contribution
Assets prior to the Closing Date, including any such income tax liabilities of
the Capital Maritime Entities that may result from the consummation of the
formation transactions for the Partnership Group and the MLP, but excluding any
federal, state, foreign and local income taxes reserved on the books of the
Partnership Group on the Closing Date.


 


SECTION 6.2. 
Limitation Regarding Indemnification.  The aggregate liability of Capital Maritime
under Section 6.1(a) above shall not exceed $5,000,000 million.  Furthermore, no claim may be made against
Capital Maritime for indemnification pursuant to Section 6.1(a) unless
the aggregate dollar amount of all claims for indemnification pursuant to such
section shall exceed $500,000, in which case Capital Maritime shall be liable
for claims for indemnification only to the extent such aggregate amount exceeds
$500,000.


 


SECTION
6.3.  Indemnification Procedures.  (a) 
The Partnership Group Members agree that within a reasonable period of
time after they become aware of facts giving rise to a claim for
indemnification pursuant to Section 6.1, they will provide notice thereof
in writing to Capital Maritime specifying the nature of and specific basis for
such claim.


 


15

















 


(b)  
Capital Maritime shall have the right to control all aspects of the
defense of (and any counterclaims with respect to) any claims brought against
the Partnership Group that are covered by the indemnification set forth in
Section 6.1, including, without limitation, the selection of counsel,
determination of whether to appeal any decision of any court and the settling
of any such matter or any issues relating thereto; provided, however,
that no such settlement shall be entered into without the consent (which
consent shall not be unreasonably withheld) of the Partnership Group unless it
includes a full release of the Partnership Group from such matter or issues, as
the case may be.


 


(c)  
The Partnership Group Members agree to cooperate fully with Capital
Maritime with respect to all aspects of the defense of any claims covered by
the indemnification set forth in Section 6.1, including, without
limitation, the prompt furnishing to Capital Maritime of any correspondence or
other notice relating thereto that the Partnership Group may receive,
permitting the names of the members of the Partnership Group to be utilized in connection
with such defense, the making available to Capital Maritime of any files,
records or other information of the Partnership Group that Capital Maritime
considers relevant to such defense and the making available to Capital Maritime
of any employees of the Partnership Group; provided, however,
that in connection therewith Capital Maritime agrees to use reasonable efforts
to minimize the impact thereof on the operations of the Partnership Group and
further agrees to maintain the confidentiality of all files, records and other
information furnished by a Partnership Group Member pursuant to this Section
6.3.  In no event shall the obligation of
the Partnership Group to cooperate with Capital Maritime as set forth in the
immediately preceding sentence be construed as imposing upon the Partnership
Group an obligation to hire and pay for counsel in connection with the defense
of any claims covered by the indemnification set forth in this Article VI; provided,
however, that the Partnership Group Members may, at their own option,
cost and expense, hire and pay for counsel in connection with any such
defense.  Capital Maritime agrees to keep
any such counsel hired by the Partnership Group reasonably informed as to the
status of any such defense (including providing such counsel with such
information related to any such defense as such counsel may reasonably request)
but Capital Maritime shall have the right to retain sole control over such
defense.


 


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


 


16

















 


ARTICLE
VII



Miscellaneous


 


SECTION 7.1. 
Choice Of Law; Submission To Jurisdiction.  This Agreement shall be subject to and
governed by the laws of the state of New York. 
Each party hereby submits to the jurisdiction of the state and federal
courts located in the state of New York and to venue in New York, New York.


 


SECTION 7.2. 
Notice.  All notices or
requests or consents provided for or permitted to be given pursuant to this
Agreement must be in writing and must be given by depositing same in the mail,
addressed to the Person to be notified, postpaid, and registered or certified
with return receipt requested or by delivering such notice in person or by
private-courier, prepaid, or by telecopier to such party.  Notice given by personal delivery or mail
shall be effective upon actual receipt. 
Couriered notices shall be deemed delivered on the date the courier
represents that delivery will occur. 
Notice given by telecopier shall be effective upon actual receipt if
received during the recipient’s normal business hours, or at the beginning of
the recipient’s next business day after receipt if not received during the
recipient’s normal business hours.  All
notices to be sent to a party pursuant to this Agreement shall be sent to or
made at the address set forth below such party’s signature to this Agreement,
or at such other address as such party may stipulate to the other parties in
the manner provided in this Section.


 


SECTION 7.3. 
Entire Agreement.  This
Agreement constitutes the entire agreement of the parties relating to the
matters contained herein, superseding all prior contracts or agreements,
whether oral or written, relating to the matters contained herein.


 


SECTION 7.4. 
Termination.  Upon a Change
of Control of the General Partner or of the MLP, the provisions of Articles II,
III, IV and V of this Agreement (but not less than all of such Articles) shall
terminate immediately.  Upon a Change of
Control of Capital Maritime, the provisions of Articles II, III, IV and V of
this Agreement (but not less than all of such Articles) shall terminate at the
time that is the later of (i) the date on which all of the MLP’s outstanding
subordinated units have converted to common units of the MLP and (ii) one year
following the date of the Change of Control of Capital Maritime; provided,
however, that in no event shall the provisions of Articles II, III, IV and V of
this Agreement terminate upon a Change of Control of Capital Maritime prior to
the date that is three years following the date of this Agreement.


 


SECTION 7.5. 
Waiver; Effect Of Waiver Or Consent.  Any party hereto may (a) extend the time
for the performance of any obligation or other act of any other party hereto or
(b) waive compliance with any agreement or condition contained herein.  Except as otherwise specifically provided
herein, any such extension or waiver shall be valid only if set forth in a
written instrument duly executed by the party or parties to be bound thereby; provided,
however, that the MLP and the OLLC may not, without the prior approval
of the Conflicts Committee, agree to any extension or waiver of this Agreement
that, in the reasonable discretion of the Board, will adversely affect the
holders of common units of the MLP.  No waiver
or consent, express or implied, by any


 


17

















 


party of or to any breach or default by any Person in the performance
by such Person of its obligations hereunder shall be deemed or construed to be
a waiver or consent of or to any other breach or default in the performance by
such Person of the same or any other obligations of such Person hereunder.  Failure on the part of a party to complain of
any act of any Person or to declare any Person in default, irrespective of how
long such failure continues, shall not constitute a waiver by such party of its
rights hereunder until the applicable statute of limitations period has run.


 


SECTION 7.6. 
Amendment Or Modification. 
This Agreement may be amended or modified from time to time only by the
written agreement of all the parties hereto; provided, however,
that the MLP and the OLLC may not, without the prior approval of the Conflicts
Committee, agree to any amendment or modification of this Agreement that, in
the reasonable discretion of the Board, will adversely affect the holders of
common units of the MLP.


 


SECTION 7.7. 
Assignment.  No party shall
have the right to assign its rights or obligations under this Agreement without
the consent of the other parties hereto.


 


SECTION 7.8. 
Counterparts.  This Agreement
may be executed in any number of counterparts with the same effect as if all
signatory parties had signed the same document. 
All counterparts shall be construed together and shall constitute one
and the same instrument.


 


SECTION 7.9. 
Severability.  If any
provision of this Agreement or the application thereof to any Person or
circumstance shall be held invalid or unenforceable to any extent, the
remainder of this Agreement and the application of such provision to other
Persons or circumstances shall not be affected thereby and shall be enforced to
the greatest extent permitted by law.


 


SECTION 7.10. 
Gender, Parts, Articles And Sections.  Whenever the context requires, the gender of
all words used in this Agreement shall include the masculine, feminine and
neuter, and the number of all words shall include the singular and plural.  All references to Article numbers and Section
numbers refer to Articles and Sections of this Agreement.


 


SECTION 7.11. 
Further Assurances.  In
connection with this Agreement and all transactions contemplated by this
Agreement, each signatory party hereto agrees to execute and deliver such
additional documents and instruments and to perform such additional acts as may
be necessary or appropriate to effectuate, carry out and perform all of the
terms, provisions and conditions of this Agreement and all such transactions.


 


SECTION 7.12. 
Withholding Or Granting Of Consent.  Each party may, with respect to any consent
or approval that it is entitled to grant pursuant to this Agreement, grant or
withhold such consent or approval in its sole and uncontrolled discretion, with
or without cause, and subject to such conditions as it shall deem appropriate.


 


18

















 


SECTION 7.13. 
Laws And Regulations. 
Notwithstanding any provision of this Agreement to the contrary, no
party to this Agreement shall be required to take any act, or fail to take any
act, under this Agreement if the effect thereof would be to cause such party to
be in violation of any applicable law, statute, rule or regulation.


 


SECTION 7.14. 
Negotiation Of Rights Of Capital Maritime, Limited Partners,
Assignees, And Third Parties.  The
provisions of this Agreement are enforceable solely by the parties to this
Agreement, and no shareholder of Capital Maritime and no limited partner,
member, assignee or other Person of the MLP or the OLLC shall have the right,
separate and apart from Capital Maritime, the MLP or the OLLC, to enforce any
provision of this Agreement or to compel any party to this Agreement to comply
with the terms of this Agreement.


 


[SIGNATURE PAGE FOLLOWS]


 


19

















 


IN WITNESS WHEREOF, the Parties have executed this Agreement on, and
effective as of, the Closing Date.


 


	
  

  	
  CAPITAL MARITIME
  & TRADING CORP.,

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  by

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
  Address for
  Notice:

  
	
   

  	
   

  
	
   

  	
  c/o Capital Ship
  Management Corp.,

  3 Iassonos Street

  Piraeus, Greece

  
	
   

  	
  Phone:

  	
  +30 210 428 4879

  
	
   

  	
  Fax:

  	
  +30 210 428 4285

  
	
   

  	
  Attention:

  	
  Ioannis E.
  Lazaridis

  
				



 


 


	
  

  	
  CAPITAL GP
  L.L.C.,

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  by

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
  Address for
  Notice:

  
	
   

  	
   

  
	
   

  	
  c/o Capital Ship
  Management Corp.,

  3 Iassonos Street

  Piraeus, Greece

  
	
   

  	
  Phone:

  	
  +30 210 428 4879

  
	
   

  	
  Fax:

  	
  +30 210 428 4285

  
	
   

  	
  Attention:

  	
  Ioannis E.
  Lazaridis

  
				



 


20

















 


	
  

  	
  CAPITAL PRODUCT
  OPERATING L.L.C.,

  
	
   

  	
   

  
	
   

  	
  by

  	
  Capital GP
  L.L.C., its general partner,

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  by

  	
  Capital Product
  Partners L.P., its sole member

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
  Address for
  Notice:

  
	
   

  	
   

  
	
   

  	
  c/o Capital Ship
  Management Corp.,

  3 Iassonos Street

  Piraeus, Greece

  
	
   

  	
  Phone:

  	
  +30 210 428 4879

  
	
   

  	
  Fax:

  	
  +30 210 428 4285

  
	
   

  	
  Attention:

  	
  Ioannis E.
  Lazaridis

  



 


 


	
  

  	
  CAPITAL PRODUCT
  PARTNERS L.P.,

  
	
   

  	
   

  
	
   

  	
  by

  	
  Capital GP
  L.L.C., its general partner,

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
  Address for
  Notice:

  
	
   

  	
   

  
	
   

  	
  c/o Capital Ship
  Management Corp.,

  3 Iassonos Street

  Piraeus, Greece

  
	
   

  	
  Phone:

  	
  +30 210 428 4879

  
	
   

  	
  Fax:

  	
  +30 210 428 4285

  
	
   

  	
  Attention:

  	
  Ioannis E.
  Lazaridis

  



 


21