Exhibit 10.7


 


	
  1.

  	
  Date
  of Agreement

  17th
  March 2005

  	
   

  	
  THE BALTIC AND INTERNATIONAL MARITIME COUNCIL
  (BIMCO)

  

  STANDARD SHIP MANAGEMENT AGREEMENT

  

  CODE NAME: “SHIPMAN 98”

  	
  



  
	
  Part I

  
	
   

  	
   

  	
   

  	
   

  
	
  2.

  	
  Owners (name, place of registered office and law of
  registry) (Cl. 1)

  	
   

  	
  3.

  	
  Managers (name, place of registered office and law of registry) (Cl. 1)

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Name

  Hamilton Navigation Inc

  	
   

  	
   

  	
  Name

  Target Marine S.A.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Place of registered office

  Ajeltake Road, Ajeltake Island, Majuro

  	
   

  	
   

  	
  Place of registered office

  24, Kanigos st, Kastella

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Law of registry

  Marshall Islands MH 96960

  	
   

  	
   

  	
  Law of registry

  Piraeus 185-34, Greece

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4.

  	
  Day and year of commencement of Agreement (Cl.
  2)

  	
   

  	
   

  	
   

  
	
   

  	
  Upon delivery of the vessel

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  5.

  	
  Crew Management (state “yes” or “no” as agreed) (Cl.
  3.1)

  	
   

  	
  6.

  	
  Technical Management (state “yes” or “no” as agreed)
  (Cl. 3.2)

  
	
   

  	
  YES

  	
   

  	
   

  	
  YES

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  7.

  	
  Commercial Management (state “yes” or “no” as
  agreed) (Cl. 3.3)

  	
   

  	
  8.

  	
  Insurance Arrangements (state “yes” or “no” as
  agreed) (Cl. 3.4)

  
	
   

  	
  Limited as per clase 3.3

  	
   

  	
   

  	
  YES

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  9.

  	
  Accounting Services (state “yes” or “no” as agreed)
  (Cl. 3.5)

  	
   

  	
  10.

  	
  Sale or purchase of the Vessel (state “yes” or “no” as agreed) (Cl. 3.6)

  
	
   

  	
  YES

  	
   

  	
   

  	
  YES

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  11.

  	
  Provisions (state “yes” or “no” as agreed) (Cl.
  3.7)

  	
   

  	
  12.

  	
  Bunkering (state “yes” or “no” as agreed) (Cl. 3.8)

  
	
   

  	
  YES

  	
   

  	
   

  	
  YES

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  13.

  	
  Chartering Services Period (only to be filled in if
  “yes” stated in Box 7) (Cl. 3.3(i))

  	
   

  	
  14.

  	
  Owners’ Insurance (state alternative (i), (ii) or
  (iii) of (Cl. 6.3)

  
	
   

  	
  N/A

  	
   

  	
   

  	
  YES (ii)

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  15.

  	
  Annual Management Fee (state annual amount) (Cl.
  8.1)

  	
   

  	
  16.

  	
  Severance Costs (state maximum amount) (Cl. 8.4 (ii))

  
	
   

  	
  US$ 182,500 or US$ 500 per day 

  	
   

  	
   

  	
  US$ 10,000

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  17.

  	
  Day and year of termination of Agreement (Cl. 17)

  14 months from delivery of the vessel 

  	
   

  	
  18.

  	
  Law and Arbitration (state
  alternative 19.1, 19.2 or 19.3; if 19.3 place of
  arbitration must be stated) (Cl. 19)

  
	
   

  	
   

  	
   

  	
   

  	
  19.1

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  19.

  	
  Notices (state postal and cable address, telex and
  telefax number for serving notice and communication to the Owners) (Cl.
  20)

  	
   

  	
  20.

  	
  Notices (state postal and cable address, telex and
  telefax number for serving notice and communication to the Managers) (Cl.
  20)

  
	
   

  	
  Hamilton Navigation Inc, Ajeltake
  Road, Ajeltake Island, Majuro, Marshall Islands MH 96960

  	
   

  	
   

  	
  Target Marine S.A., 24 Kanigos st,
  Kastella, Piraeus 185-34, Greece

  
						



 


It is mutually agreed between the party stated in Box 2 and the
party stated in Box 3 that this Agreement consisting of PART I
and PART II as well as Annexes “A” (Details of Vessel), “B”
(Details of Crew), “C” (Budget) and “D” (Associated vessels)
attached hereto, shall be performed subject to the conditions contained herein.
In the event of a conflict of conditions, the provisions of PART I
and Annexes “A”, “B”, “C” and “D” shall prevail
over those of PART II to the extent of such conflict but no
further.


 


	
  Signature(s)
  (Owners)

  	
  Signature(s)
  (Managers)

  
	
   

  	
   

  
	
  /s/ Illegible

  	
   

  	
  /s/
  Illegible

  	
   

  
				



 


This document is a computer generated SHIPMAN 98 form printed by
authority of BIMCO. Any insertion or deletion to the form must be clearly
visible. In the event of any modification made to the pre-printed text of this
document which is not clearly visible, the text of the original BIMCO approved
document shall apply. BIMCO assumes no responsibility for any loss, damage or
expense as a result of discrepancies between the original BIMCO approved
document and this computer generated document.


 

















 


PART II

“SHIPMAN 98” Standard Ship Management Agreement


 


1.                         Definitions


 


In this Agreement save where the context otherwise
requires, the following words and expressions shall have the meanings hereby
assigned to them.


 


“Owners” means the
party identified in Box 2.


 


“Managers” means
the party identified in Box 3.


 


“Vessel” means the
vessel or vessels details of which are set out in Annex “A” attached
hereto.


 


“Crew” means the
Master, officers and ratings of the numbers, rank and nationality specified in Annex
“B” attached hereto.


 


“Crew Support Costs” means
all expenses of a general nature which are not particularly referable to any individual
vessel for the time being managed by the Managers and which are incurred by the
Managers for the purpose of providing an efficient and economic management
service and, without prejudice to the generality of the foregoing, shall
include the cost of crew standby pay, training schemes for officers and
ratings, cadet training schemes, sick pay, study pay, recruitment and
interviews. 


 


“Severance Costs” means
the costs which the employers are legally obliged to pay to or in respect of
the Crew as a result of the early termination of any employment contract for
service on the Vessel.


 


“Crew Insurances” means
insurances against crew risks which shall include but not be limited to death,
sickness, repatriation, injury, shipwreck unemployment indemnity and loss of
personal effects.


 


“Management Services” means
the services specified in sub-clauses 3.1 to 3.8 as indicated affirmatively in
Boxes 5 to 12.


 


“ISM Code” means
the International Management Code for the Safe Operation of Ships and for
Pollution Prevention as adopted by the International Maritime Organization
(IMO) by resolution A.741(18) or any subsequent amendment thereto.


 


“STCW 95” means
the International Convention on Standards of Training, Certification and
Watchkeeping for Seafarers, 1978, as amended in 1995 or any subsequent
amendment thereto.


 


2.                         Appointment
of Managers


 


With effect from the day and year stated in Box 4
and continuing unless and until terminated as provided herein, the Owners
hereby appoint the Managers and the Managers hereby agree to act as the
Managers of the Vessel.


 


3.                         Basis of
Agreement


 


Subject to the terms and conditions herein provided,
during the period of this Agreement, the Managers shall carry out Management
Services in respect of the Vessel as agents for and on behalf of the Owners.
The Managers shall have authority to take such actions as they may from
time to time in their absolute discretion consider to be necessary to enable
them to perform this Agreement in accordance with sound ship management
practice.


 


3.1 Crew Management


(only applicable if agreed according
to Box 5)


 


The Managers shall provide suitably qualified Crew for
the Vessel as required by the Owners in accordance with the STCW 95
requirements, provision of which includes but is not limited to the following
functions:


 


(i)                       selecting
and engaging the Vessel’s Crew, including payroll arrangements, pension
administration, and insurances for the Crew other than those mentioned in Clause
6;


 


(ii)                    ensuring
that the applicable requirements of the law of the flag of the Vessel are
satisfied in respect of manning levels, rank, qualification and certification
of the Crew and employment regulations including Crew’s tax, social insurance,
discipline and other requirements;


 


(iii)                 ensuring that all members of the Crew
have passed a medical examination with a qualified doctor certifying that they
are fit for the duties for which they are engaged and are in possession of
valid medical certificates issued in accordance with appropriate flag State
requirements. In the absence of applicable flag State requirements the medical
certificate shall be dated not more than three months prior to the respective
Crew members leaving their country of domicile and maintained for the duration
of their service on board the Vessel;


 


(iv)                ensuring
that the Crew shall have a command of the English language of a sufficient
standard to enable them to perform their duties safely;


 


(v)                   arranging
transportation of the Crew, including repatriation;


 


(vi)                training
of the Crew and supervising their efficiency;


 


(vii)             conducting union negotiations;


 


(viii)          operating the Managers’ drug and alcohol
policy unless otherwise agreed.


 


3.2 Technical Management


(only applicable if agreed according
to Box 6)


 


The Managers shall provide technical management which
includes, but is not limited to, the following functions:


 


(i)                       provision
of competent personnel to supervise the maintenance and general efficiency of
the Vessel;


 


(ii)                    arrangement
and supervision of dry dockings, repairs, alterations and the upkeep of the
Vessel to the standards required by the Owners provided that the Managers shall
be entitled to incur the necessary expenditure to ensure that the Vessel will
comply with the law of the flag of the Vessel and of the places where she
trades, and all requirements and recommendations of the classification society;


 


(iii)                 arrangement of the supply of necessary
stores, spares and lubricating oil;


 


(iv)                appointment
of surveyors and technical consultants as the Managers may consider from
time to time to be necessary;


 


(v)                   development,
implementation and maintenance of a Safety Management System (SMS) in
accordance with the ISM Code (see sub-clauses 4.2 and 5.3).


 


3.3 Commercial Management


(only applicable if agreed according
to Box 7)


 


The Managers shall provide the commercial operation of
the Vessel, as required by the Owners, which includes, but is not limited to,
the following functions:


 


(iii)                 providing voyage estimates and
accounts and calculating of hire, freights, demurrage and/or despatch moneys
due from or due to the charterers of the Vessel;


 


(iv)                issuing
of voyage instructions;


 


(v)                   appointing
agents;


 


(vi)                appointing
stevedores;


 


(vii)             arranging surveys associated with the
commercial operation of the Vessel.


 


3.4 Insurance Arrangements(1)


(only applicable if agreed according
to Box 8)


 


The Managers shall arrange insurances in accordance
with Clause 6, on such terms and conditions as the Owners shall have instructed
or agreed, in particular regarding conditions,


 

















 


Insured values, deductibles and franchises.


 


3.5                  Accounting
Services


(only applicable if agreed according
to Box 9)


 


The Managers shall:


 


(I)                      establish
an accounting system which meets the requirements of the Owners and provide
regular accounting services, supply regular reports and records,


 


(II)                  maintain
the records of all costs and expenditure incurred as well as data necessary or
proper for the settlement of accounts between the parties.


 


3.6                  Sale or Purchase
of the Vessel


(only applicable if agreed according
to Box 10)


 


The Managers shall, in accordance with the Owners’
instructions, supervise the sale or purchase of the Vessel, including the
performance of any sale or purchase agreement, but not negotiation of the same.


 


3.7                  Provisions (only applicable if agreed according to Box 11)


 


The Managers shall arrange for the supply of
provisions.


 


3.8                  Bunkering (only applicable if agreed according to Box 12)


 


The Managers shall arrange for the provision of bunker
fuel of the quality specified by the Owners as required for the Vessel’s trade.


 


4.                         Managers’
Obligations


 


4.1                  The Managers
undertake to use their best endeavours to provide the agreed Management
Services as agents for and on behalf of the Owners in accordance with sound
ship management practice and to protect and promote the interests of the Owners
in all matters relating to the provision of services hereunder. Provided,
however, that the Managers in the performance of their management
responsibilities under this Agreement shall be entitled to have regard to their
overall responsibility in relation to all vessels as may from time to time
be entrusted to their management and in particular, but without prejudice to
the generality of the foregoing, the Managers shall be entitled to allocate
available supplies, manpower and services in such manner as in the prevailing
circumstances the Managers in their absolute discretion consider to be fair and
reasonable.


 


4.2                  Where the Managers are providing
Technical Management in accordance with sub-clause 3.2, they shall procure that the requirements
of the law of the flag of the Vessel are satisfied and they shall in particular
be deemed to be the “Company” as defined by the ISM Code, assuming the
responsibility for the operation of the Vessel and taking over the duties and
responsibilities imposed by the ISM Code when applicable.


 


5.                         Owners’
Obligations


 


5.1                  The Owners shall pay all sums due to
the Managers punctually in accordance with the terms of this Agreement.


 


5.2                  Where the Managers are providing
Technical Management in accordance with sub-clause 3.2, the Owners shall:


 


(i)                       procure
that all officers and ratings supplied by them or on their behalf comply with
the requirements of STCW 95;


 


(ii)                    instruct
such officers and ratings to obey all reasonable orders of the Managers in
connection with the operation of the Managers’ safety management system.


 


5.3                  Where the Managers are not providing
Technical Management in accordance with sub-clause 3.2, the Owners shall procure that the
requirements of the law of the flag of the Vessel are satisfied and that they,
or such other entity as may be appointed by them and identified to the
Managers, shall be deemed to be the “Company” as defined by the ISM Code
assuming the responsibility for the operation of the Vessel and taking over the
duties and responsibilities imposed by the ISM Code when applicable.


 


6.                         Insurance
Policies


 


The Owners shall procure, whether by instructing the
Managers under sub-clause 3.4 or otherwise, that throughout the period
of this Agreement:


 


6.1                  at the Owners’ expense, the Vessel is
insured for not less than her sound market value or entered for her full gross
tonnage, as the case may be for:


 


(i)                       usual
hull and machinery marine risks (including crew negligence) and excess
liabilities;


 


(ii)                    protection
and indemnity risks (including pollution risks and Crew Insurances); and


 


(iii)                 war risks (Including protection and
indemnity and crew risks)


 


In accordance with the best practice of prudent owners
of vessels of a similar type to the Vessel, with first class insurance
companies, underwriters or associations (“the Owners’ Insurances”);


 


6.2                  all premiums and calls on the Owners’
Insurances are paid promptly by their due date,


 


6.3                  the Owners’ Insurances name jointly the
Owners and the Managers and, subject


 


to underwriters’ agreement, any third party designated
by the Managers as a joint assured or
as a loss payee, with full
cover, with the Owners


 


obtaining cover in respect of each of the insurances
specified in sub-clause 6.1:


 


(i)                       on
terms whereby the Managers and any such third party are liable in respect of
premiums or calls arising in connection with the Owners’ Insurances; or


 


(ii)                    if
reasonably obtainable, on terms such that neither the Managers nor any such
third party shall be under any liability in respect of premiums or calls
arising in connection with the Owners’ Insurances; or


 


(iii)                 on such other terms as may be
agreed in writing.


 


Indicate alternative (i), (ii) or
(iii) in Box 14. If Box 14 is left blank then (i) applies.


 


6.4                  written evidence is provided, to the
reasonable satisfaction of the Managers, of their compliance with their
obligations under Clause 6 within a reasonable time of the commencement
of the Agreement, and of each renewal
date and, if specifically requested, of each payment date of the Owners’
Insurances.


 


7.                         Income Collected and Expenses
Paid on Behalf of Owners


 


7.1                  All moneys collected by the Managers
under the terms of this Agreement (other than moneys payable by the Owners to
the Managers) and any interest thereon shall be held to the credit of the
Owners in a separate bank account.


 


7.2                  All expenses incurred by the Managers
under the terms of this Agreement on behalf of the Owners (including expenses
as provided in Clause 8) may be debited against the Owners in the
account referred to under sub-clause 7.1 but shall in any event remain
payable by the Owners to the Managers on demand.


 


8.                         Management
Fee


 


8.1                  The Owners shall pay to the Managers
for their services as Managers under this Agreement an annual management fee as
stated in Box 15 which shall be payable by equal monthly instalments in
advance, the first instalment being payable on the commencement of this
Agreement (see Clause 2 and Box 4) and subsequent instalments
being payable every month.


 


8.3                  The Managers
shall, at no extra cost to the Owners, provide their own office accommodation,
office staff, facilities and stationery. Without limiting the generality of Clause
7 the Owners shall reimburse the Managers for postage and communication
expenses, travelling expenses, and other out of pocket


 

















 


expenses properly incurred by the Managers in
pursuance of the Management Services.


 


8.4 In the event of
the appointment of the Managers being terminated by the Owners or the Managers
in accordance with the provisions of Clauses 17 and 18.1 other
than by reason of default by the Managers, or if the Vessel is lost, sold or
otherwise disposed of, the “management fee” payable to the Managers according
to the provisions of sub-clause 8.1, shall continue to be payable for a
further period of one calendar
month as from the termination date. In addition, provided that the Managers
provide Crew for the Vessel in accordance with sub-clause 3.1:


 


(i)        the
Owners shall continue to pay Crew Support Costs during the said further period
of three calendar months and


 


(ii)       the
Owners shall pay an equitable proportion of any Severance Costs which may materialize,
not exceeding the amount stated in Box 16.


 


8.5 If the Owners
decide to lay-up the Vessel whilst this Agreement remains in force and such
lay-up lasts for more than three months, an appropriate reduction of the
management fee for the period exceeding three months until one month before the
Vessel is again put into service shall be mutually agreed between the parties.


 


8.6 Unless
otherwise agreed in writing all discounts and commissions obtained by the
Managers in the course of the management of the Vessel shall be credited to the
Owners.


 


9.                         Budgets
and Management of Funds


 


9.1 The Managers should this Agreement be extended as per Clause 17 shall
present to the Owners annually a budget for the following twelve months in such
form as the Owners require. The budget for the first 14 months hereof is fixed to be US$ 3,550 per day. Subsequent
annual budgets shall be prepared by the Managers and submitted to the Owners
not less than two months before
the anniversary date of the Owners’ financial
year (see Clause 2 and Box 4).


 


9.2 The Owners
shall indicate to the Managers their acceptance and approval of the annual
budget within one month of presentation and in the absence of any such indication
the Managers shall be entitled to assume that the Owners have accepted the
proposed budget. Should the Owners disagree
with the budget and same is not amended within three (3) days to meet with
Owners reasonable requirements, Owners will have a right to terminate this
Agreement as per clause 18.2.


 


9.3 Following the
agreement of the budget, the Managers shall prepare and present to the Owners
their estimate of the working capital requirement of the Vessel and the
Managers shall each month up-date this estimate. Based thereon, the Managers
shall each month request the Owners in writing for the funds required to run
the Vessel for the ensuing month, including the payment of any occasional or
extraordinary item of expenditure, such as emergency repair costs, additional
insurance premiums, bunkers or provisions. Such funds shall be received by the
Managers within ten running days after the receipt by the Owners of the
Managers’ written request and shall be held to the credit of the Owners in a
separate bank account.


 


9.4 The Managers
shall produce a comparison between budgeted and actual income and expenditure
of the Vessel in such form as required by the Owners monthly or at such
other intervals as mutually agreed.


 


9.5 Notwithstanding
anything contained herein to the contrary, the Managers shall in no
circumstances be required to use or commit their own funds to finance the
provision of the Management Services.


 


10.                  Managers’ Right
to Sub-Contract


 


The Managers shall not have the right to sub-contract any
of their obligations hereunder, including those mentioned in sub-clause 3.1,
without the prior written consent of the Owners which shall not be unreasonably
withheld. In the event of such a sub-contract the Managers shall remain fully
liable for the due performance of their obligations under this Agreement.


 


11.                  Responsibilities


 


11.1 Force
Majeure - Neither
the Owners nor the Managers shall be under any liability for any failure to perform any
of their obligations hereunder by reason of any cause whatsoever of any nature
or kind beyond their reasonable control.


 


11.2 Liability
to Owners - (i) Without
prejudice to sub-clause 11.1, the Managers shall be under no liability
whatsoever to the Owners for any loss, damage, delay or expense of whatsoever
nature, whether direct or indirect, (including but not limited to loss of
profit arising out of or in connection with detention of or delay to the
Vessel) and howsoever arising in the course of performance of the Management
Services UNLESS same is proved to
have resulted solely from the negligence, gross negligence or wilful default of
the Managers or their employees, or agents or sub-contractors employed by them
in connection with the Vessel, in which case (save where loss, damage, delay or
expense has resulted from the Managers’ personal act or omission committed with
the intent to cause same or recklessly and with knowledge that such loss,
damage, delay or expense would probably result) the Managers’ liability for
each incident or series of incidents giving rise to a claim or claims
shall never exceed a total of ten times the annual management fee payable
hereunder.


 


(ii) Notwithstanding anything that may appear to
the contrary in this Agreement, the Managers shall not be liable for any of the
actions of the Crew, even if such actions are negligent, grossly negligent or
wilful, except only to the extent that they are shown to have resulted from a
failure by the Managers to discharge their obligations under sub-clause 3.1,
in which case their liability shall be limited in accordance with the terms of
this Clause 11.


 


11.3 Indemnity
- Except to the extent and solely for the amount
therein set out that the Managers would be liable under sub-clause 11.2,
the Owners hereby undertake to keep the Managers and their employees, agents
and sub-contractors Indemnified and to hold them harmless against all actions,
proceedings, claims, demands or liabilities whatsoever or howsoever arising
which may be brought against them or incurred or suffered by them arising
out of or in connection with the performance of the Agreement, and against and
in respect of all costs, losses, damages and expenses (including legal costs
and expenses on a full indemnity basis) which the Managers may suffer or
incur (either directly or indirectly) in the course of the performance of this
Agreement.


 


11.4 “Himalaya”
- It
is hereby expressly agreed that no employee or agent of the Managers (including
every sub-contractor from time to time employed by the Managers) shall in any
circumstances whatsoever be under any liability whatsoever to the Owners for
any loss, damage or delay of whatsoever kind arising or resulting directly or
indirectly from any act, neglect or default on his part while acting in
the course of or in connection with his employment and, without prejudice to
the generality of the foregoing provisions in this Clause 11, every
exemption, limitation, condition and liberty herein contained and every right,
exemption from liability, defence and immunity of whatsoever nature applicable
to the Managers or to which the Managers are entitled hereunder shall also be
available and shall extend to protect every such employee or agent of the
Managers acting as aforesaid and for the purpose of all the foregoing
provisions of this Clause 11 the Managers are or shall be deemed to be
acting as agent or trustee on behalf of and for the benefit of all persons who
are or might be their servants or agents from time to time (including
sub-contractors as aforesaid) and all such persons shall to this extent be or be
deemed to be parties to this


 

















 


Agreement.


 


12.                  Documentation


 


Where the Managers are providing Technical Management
in accordance with sub-clause 3.2, and/or
Crew Management in accordance with sub-clause 3.1, they shall make
available, upon Owners’ request, all documentation and records related to the
Safety Management System (SMS) and/or the Crew which the Owners need in order
to demonstrate compliance with the ISM Code and STCW 95 or to defend a claim
against a third party.


 


13.                  General
Administration


 


13.1 The Managers shall handle and settle with Owners’ prior approval, all claims
arising out of the Management Services hereunder and keep the Owners informed
regarding any incident of which the Managers become aware which gives or may give
rise to claims or disputes involving third parties.


 


13.2 The Managers shall, as Instructed by the
Owners, bring or defend actions, suits or proceedings in connection with
matters entrusted to the Managers according to this Agreement.


 


13.3 The Managers shall also have power to obtain
legal or technical or other outside expert advice in relation to the handling
and settlement of claims and disputes or all other matters affecting the
interests of the Owners in respect of the Vessel.


 


13.4 The Owners shall arrange for the provision of
any necessary guarantee bond or other security.


 


13.5 Any costs reasonably incurred by the Managers
in carrying out their obligations according to Clause 13 shall be
reimbursed by the Owners.


 


14.                  Auditing


 


The Managers shall provide
bookkeeping services and shall at all times maintain and keep true
and correct accounts and shall make the same available for inspection and
auditing by the Owners or by independent
auditors at such times
as may be mutually agreed. On the termination, for whatever reasons, of
this Agreement, the Managers shall release to the Owners, if so requested, the
originals where possible, or otherwise certified copies, of all such accounts
and all documents specifically relating to the Vessel and her operation.


 


15.                  lnspection of
Vessel


 


The Owners shall have the
right at any time after giving reasonable notice to the Managers to inspect the
Vessel for any reason they consider necessary.


 


16.                  Compliance with
Laws and Regulations


 


The Managers will not do or
permit to be done anything which might cause any breach or infringement of the
laws and regulations of the Vessel’s flag, or of the places where she trades.


 


17.                  Duration of the
Agreement


 


This Agreement shall come
into effect on the day and year stated in Box 4 and shall continue until
the date stated in Box 17. Thereafter it shall continue until terminated
by either party giving to the other notice in writing, in which event the
Agreement shall terminate upon the expiration of a period of two months from
the date upon which such notice was given.


 


18.                  Termination


 


18.1 Owners’ default


 


(I)           The Managers shall be entitled to terminate
the Agreement with immediate effect by notice in writing if any moneys payable
by the Owners under this Agreement shall not have been received in the Managers’
nominated account within ten running days of receipt by the Owners of the
Managers written request or if the Vessel is repossessed by the Mortgagees.


 


(II)                   If the Owners:


 


(a)                     fail to meet
their obligations under sub-clauses 5.2 and 5.3 of this Agreement for any reason within their
control, or


 


(b)                     proceed with
the employment of or continue to employ the Vessel in the carriage of
contraband, blockade running, or in an unlawful trade, or on a voyage which in
the reasonable opinion of the Managers is unduly hazardous or improper,


 


the Managers may give
notice of the default to the Owners, requiring them to remedy it as soon as
practically possible. In the event that the Owners fail to remedy it within a
reasonable time to the satisfaction of the Managers, the Managers shall be
entitled to terminate the Agreement with immediate effect by notice in writing.


 


18.2 Managers’ Default


 


If the Managers fail to meet
their obligations under Clauses 3 and 4 of this Agreement for any
reason within the control of the Managers, the Owners may give notice to
the Managers of the default, requiring them to remedy it as soon as practically
possible. In the event that the Managers fail to remedy it within a reasonable
time to the satisfaction of the Owners, the Owners shall be entitled to
terminate the Agreement with immediate effect by notice in writing.


 


18.3 Extraordinary Termination


 


This Agreement shall be
deemed to be terminated in the case of the sale of the Vessel or if the Vessel
becomes a total loss or is declared as a constructive or compromised or
arranged total loss or is requisitioned.


 


18.4 For the purpose of sub-clause 18.3
hereof


 


(I)          the date upon which the Vessel is to be
treated as having been sold or otherwise disposed of shall be the date on which
the Owners cease to be registered as Owners of the Vessel;


 


(II)       the Vessel shall not be deemed to be lost unless
either she has become an actual total loss or agreement has been reached with
her underwriters in respect of her constructive, compromised or arranged total
loss or if such agreement with her underwriters is not reached it is adjudged
by a competent tribunal that a constructive loss of the Vessel has occurred.


 


18.5 This Agreement shall terminate forthwith in
the event of an order being made or resolution passed for the winding up,
dissolution, liquidation or bankruptcy of either party (otherwise than for the
purpose of reconstruction or amalgamation) or if a receiver is appointed, or if
it suspends payment, ceases to carry on business or makes any special
arrangement or composition with its creditors.


 


18.6 The termination of this Agreement shall be
without prejudice to all rights accrued due between the parties prior to the
date of termination.


 


19.                  Law and
Arbitration


 


19.1 This Agreement shall be governed by and
construed in accordance with English law and any dispute arising out of or in
connection with this Agreement shall be referred to arbitration in London in
accordance with the Arbitration Act 1996 or any statutory modification or re-enactment
thereof save to the extent necessary to give effect to the provisions of this
Clause.


 


The arbitration shall be conducted in accordance with
the London Maritime Arbitrators Association (LMAA) Terms current at the time
when the arbitration proceedings are commenced.


 


The reference shall be to three arbitrators. A party
wishing to refer a dispute to arbitration shall appoint its arbitrator and send
notice of such appointment in writing to the other


 

















 


party requiring the other party to appoint its own
arbitrator within 14 calendar days of that notice and stating that it will
appoint its arbitrator as sole arbitrator unless the other party appoints its
own arbitrator and gives notice that it has done so within the 14 days
specified. If the other party does not appoint its own arbitrator and give
notice that it has done so within the 14 days specified, the party referring a
dispute to arbitration may, without the requirement of any further prior notice
to the other party, appoint its arbitrator as sole arbitrator and shall advise
the other party accordingly. The award of a sole arbitrator shall be binding on
both parties as if he had been appointed by agreement.


 


Nothing herein shall prevent the parties agreeing in
writing to vary these provisions to provide for the appointment of a sole
arbitrator.


 


In cases where neither the claim nor any counterclaim
exceeds the sum of USD50,000 (or such other sum as the parties may agree)
the arbitration shall be conducted in accordance with the LMAA Small Claims Procedure
current at the time when the arbitration proceedings are commenced.


 


19.2           This Agreement shall be governed by and
construed in accordance with Title 9 of the United States Code and the Maritime
Law of the United States and any dispute arising out of or in connection with
this Agreement 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 the purposes of
enforcing any award, judgement may be entered on an award by any court of competent
jurisdiction. The proceedings shall be conducted in accordance with the rules of
the Society of Maritime Arbitrators, Inc.


 


In cases where neither the claim nor any counterclaim
exceeds the sum of USD50,000 (or such other sum as the parties may agree)
the arbitration shall be conducted in accordance with the Shortened Arbitration
Procedure of the Society of Maritime Arbitrators, Inc. current at the time
when the arbitration proceedings are commenced.


 


19.3           This Agreement shall be governed by and
construed in accordance with the laws of the place mutually agreed by the
parties and any dispute arising out of or in connection with this Agreement
shall be referred to arbitration at a mutually agreed place, subject to the
procedures applicable there.


 


19.4           If Box 18 in Part I is not
appropriately filled in, sub-clause 19.1 of this Clause shall apply.


 


 


Note: 19.1, 19.2 and 19.3
are alternatives; indicate alternative agreed in Box 18.


 


20.                  Notices


 


20.1           Any notice to be
given by either party to the other party shall be in writing and may be
sent by fax, telex, registered or recorded mail or by personal service.


 


20.2           The address of the Parties for service of
such communication shall be as stated in Boxes 19 and 20,
respectively.


 

















 


ANNEX “A” (DETAILS OF VESSEL OR
VESSELS) TO

THE BALTIC AND INTERNATIONAL MARITIME COUNCIL (BIMCO)

STANDARD SHIP MANAGEMENT AGREEMENT - CODE NAME: “SHIPMAN 98”


 


Date of Agreement:

17th March 2005

Name of Vessel(s):

MV Electra


 


Particulars of Vessel(s):

Built: 09/2004, By: Onomichi (Japan) Hull
No.504

Flag: Marshall Islands, Place of
Registration: Majuro

Call Sign: V 7 G L 5, Grt/Nrt: 29,990/18,081 tns

Register Number: 2123, IMO No.:9277656


 


21. The fixed amount of US$ 3,550 per
day under Clause 9.1 will be paid to the Managers monthly in advance and will
cover all operating expenses of the Vessel, less any extraordinary amounts
necessary for emergency repairs, scheduled drydocking, Special Survey, modifications,
additional insurance premiums, bunkers or provisions. The operating expenses
include by way of indication crew wages and related costs, expenses for the
support and victualing of the crew, the cost of insurance (including loss of
hire insurance), expenses relating to scheduled repairs and maintenance,
including paints, the costs of spares and consumable stores, lubricating oils,
flag expenses (including tonnage tax and surveys) and other miscellaneous
expenses.


 


22. It is also agreed that the
Managers will arrange also for loss of hire insurance on terms and conditions
acceptable to the Owners.


 


23. The Management fee as per box 15
is on the basis of a parity of US$ / Euro at 1.30 up to 1.35. At the beginning
of each calendar quarter date the daily Management fee for the next 3 months
will be adjusted only upwards according to the US$ / Euro exchange rate as
quoted by EFG Eurobank Ergasias Bank SA two business days before the end of
each calendar quarter.