Exhibit 4.60

|      |    |           |     
|----- | -- | --------- | ----
|DATED | 25 | SEPTEMBER | 2008
|      |    |           |     

ENIADEFHI SHIPPING CORPORATION
(as Borrower)

- and -

DnB NOR BANK ASA
(as Lender)

| |                                   | 
| | --------------------------------- | 
| |                                   | 
|
| | US$45,000,000 SECURED             | 
| | MULTI-CURRENCY REDUCING REVOLVING | 
| | CREDIT FACILITY AGREEMENT         | 
|
| |                                   | 
| | m.v. MARTINE                    | 

STEPHENSON HARWOOD
One St. Pauls Churchyard
London EC4M 8SH
Tel: 020 7329 4422
Fax: 020 7329 7100
Ref: 04.135

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CONTENTS

|   |                                     |     
|-- | ----------------------------------- | ----
|   |                                     | Page
|   |                                     |     
|1  | Definitions
 and Interpretation     | 1   
|   |                                     |     
|2  | The Loan and
 its Purpose           | 16  
|   |                                     |     
|3  | Conditions
 of Utilisation          | 16  
|   |                                     |     
|4  | Advance                             | 18  
|   |                                     |     
|5  | Currency                            | 18  
|   |                                     |     
|6  | Repayment                           | 19  
|   |                                     |     
|7  | Prepayment                          | 20  
|   |                                     |     
|8  | Interest                            | 21  
|   |                                     |     
|9  | Indemnities                         | 24  
|   |                                     |     
|10 | Fees                                | 27  
|   |                                     |     
|11 | Security and
 Application of Moneys | 28  
|   |                                     |     
|12 | Representations                     | 33  
|   |                                     |     
|13 | Undertakings
 and Covenants         | 35  
|   |                                     |     
|14 | Events of
 Default                  | 44  
|   |                                     |     
|15 | Assignment
 and Sub-Participation   | 48  
|   |                                     |     
|16 | Set-Off                             | 49  
|   |                                     |     
|17 | Payments                            | 49  
|   |                                     |     
|18 | Notices                             | 51  
|   |                                     |     
|19 | Partial
 Invalidity                 | 52  
|   |                                     |     
|20 | Remedies and
 Waivers               | 52  
|   |                                     |     
|21 | Miscellaneous                       | 53  
|   |                                     |     
|22 | Law and
 Jurisdiction               | 55  

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|             |  |                                      |   
|------------ |  | ------------------------------------ | --
|SCHEDULE 1:  |  | Conditions
 Precedent and Subsequent | 55
|Part
 I:     |  | Conditions precedent                 | 55
|Part
 II:    |  | Conditions subsequent                | 59
|             |  |                                      |   
|SCHEDULE 2:  |  | Calculation
 of Mandatory Cost       | 60
|             |  |                                      |   
|SCHEDULE 3:  |  | Form of
 Drawdown Notice             | 62
|             |  |                                      |   
|SCHEDULE
 4: |  | Form of Compliance
 Certificate      | 63

---



LOAN AGREEMENT

Dated:     25
September     2008

|                          |                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                | 
|------------------------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | 
|BETWEEN:                 
|                          |                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                | 
|(1)                       | ENIADEFHI SHIPPING CORPORATION,
 a company incorporated under the laws of the Republic of Liberia whose
 registered office is at 80 Broad Street, Monrovia, Liberia (the Borrower);
 and                                                                                                                                             
|                          |                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                | 
|(2)                       | DnB NOR BANK ASA,
 acting through its office at 20 St. Dunstans Hill, London EC3R 8HY, England
 (the Lender).                                                                                                                                                                                                                       
|                          |                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                | 
|WHEREAS:                 
|                          |                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                | 
|(A)                       | The Borrower
 has agreed to purchase and take delivery of the Vessel from the Seller on the
 terms of the Ship Sale Contract and intends to register the Vessel on
 delivery under the flag of Cyprus.                                                                                                                                 
|                          |                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                | 
|(B)                       | The Lender
 has agreed to advance to the Borrower a secured multi-currency reducing
 revolving credit facility of up to forty five million Dollars ($45,000,000)
 for general working capital purposes in respect of the Group and for the
 purpose of assisting the Borrower in financing part of the acquisition cost
 of the Vessel.
|                          |                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                | 
|IT IS AGREED as
 follows:
|                          |                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                | 
|1                         | Definitions and Interpretation                                                                                                                                                                                                                                                                                                         
|                          |                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                | 
|                          | 1.1                                                                                                                                                                                                                                                                                                                                     | In this
 Agreement:                                                                                                                                                                                                           
|                          |                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                | 
|                          |                                                                                                                                                                                                                                                                                                                                         | Accounting
 Information means the annual financial statements and/or the
 quarterly financial statements to be provided by the Corporate Guarantor to
 the Lender in accordance with Clauses 13.1.1 and 13.1.2 respectively.
|                          |                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                | 
|                          |                                                                                                                                                                                                                                                                                                                                         | Accounts
 means the Operating Account and the Cash Collateral Account.                                                                                                                                                      
|                          |                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                | 
|                          |                                                                                                                                                                                                                                                                                                                                         | Accounts
 Charge means the deed of charge referred to in Clause 11.13.                                                                                                                                                      
|                          |                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                | 
|                          |                                                                                                                                                                                                                                                                                                                                         | Administration
 has the meaning given to it in paragraph 1.1.3 of the ISM Code.                                                                                                                                             

---



| |  |                                                                                                                                                                                                                                                                                                                                                                                                                     | 
| |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | 
| |  | Annex VI
 means Annex VI (Regulations for the Prevention of Air Pollution from Ships)
 to the International Convention for the Prevention of Pollution from Ships
 1973 (as modified in 1978 and 1997).                                                                                                                                                                                                          
| |  |                                                                                                                                                                                                                                                                                                                                                                                                                     | 
| |  | Assignment
 means the deed of assignment referred to in Clause 11.1.2.                                                                                                                                                                                                                                                                                                                                           
| |  |                                                                                                                                                                                                                                                                                                                                                                                                                     | 
| |  | Availability
 Termination Date means three (3) months prior to the Final
 Maturity Date or such later date as the Lender may in its discretion agree.                                                                                                                                                                                                                                                            
| |  |                                                                                                                                                                                                                                                                                                                                                                                                                     | 
| |  | Avstes
 means Avstes Shipping Corporation, a company incorporated according to the
 laws of the Republic of Liberia or such other company which shall be its
 successor in title.                                                                                                                                                                                                                                
| |  |                                                                                                                                                                                                                                                                                                                                                                                                                     | 
| |  | Avstes
 Agreement means the reducing revolving multi-currency credit
 facility agreement dated 17 April 2008, as amended and supplemented by a
 first supplemental agreement dated 22 May 2008, each made between Avstes, as
 borrower and the Lender, as lender, as the same may be further amended and/or
 supplemented and/or novated from time to time.                                                      
| |  |                                                                                                                                                                                                                                                                                                                                                                                                                     | 
| |  | Avstes
 Indebtedness means the Indebtedness as such term is defined in
 the Avstes Agreement.                                                                                                                                                                                                                                                                                                                    
| |  |                                                                                                                                                                                                                                                                                                                                                                                                                     | 
| |  | Break
 Costs means all sums payable by the Borrower from time to time
 under Clause 9.3.                                                                                                                                                                                                                                                                                                                         
| |  |                                                                                                                                                                                                                                                                                                                                                                                                                     | 
| |  | Broker
 means any one of Arrow Chartering (UK), Braemer Seascope Group, Clarksons PLC
 and Fearnleys and Brokers means more than one of them.                                                                                                                                                                                                                                                                  
| |  |                                                                                                                                                                                                                                                                                                                                                                                                                     | 
| |  | Builder
 means IHI Marine United Inc., a corporation organised and existing under the
 laws of Japan, having its registered office at 22-23, Kaigan 3-chome,
 Minato-ku, Tokyo 108-0022, Japan.                                                                                                                                                                                                                  
| |  |                                                                                                                                                                                                                                                                                                                                                                                                                     | 
| |  | Business
 Day means a day (other than a Saturday or Sunday) on which banks
 are open for general business in New York, Athens and London and Tokyo (only
 if an amount in Japanese Yen is involved) and Zurich (only if an amount in
 Swiss Francs is involved) and any other financial centre which the Lender may
 consider appropriate for the operation of the provisions of this Agreement,
 and in the case

2

---



| |  |                                                                                                                                                                                                                      |     |                                                                                                                                                                                                                                                                                                                                                            
| |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | of Euro, a
 day on which the Trans-European Automated Real Time Gross Settlement Express
 Transfer Payment System (TARGET) is operating.                                                                            
| |  |                                                                                                                                                                                                                      |    
| |  | Cash
 Collateral Account means the bank account to be opened (if and
 when required) in the name of the Borrower with the Lender and designated
 63646004 - Cash Collateral Account.                            
| |  |                                                                                                                                                                                                                      |    
| |  | Charters
 means the Existing Charter and any other time charter or other contact of
 employment in respect of the Vessel which shall not exceed thirteen (13)
 months duration and Charter means either of them.
| |  |                                                                                                                                                                                                                      |    
| |  | Charterer
 means Daiichi Chuo Kisen Kaisha of Tokyo, Japan or any other charterer who
 has entered into or shall enter into a Charter and Charterers means more than
 one of them.                              
| |  |                                                                                                                                                                                                                      |    
| |  | Compliance
 Certificate means a certificate substantially in the form set out
 in Schedule 4 in form and substance satisfactory to the Lender.                                                                    
| |  |                                                                                                                                                                                                                      |    
| |  | Consolidated
 Group Leverage means at any relevant time Consolidated Total
 Liabilities divided by Consolidated Total Assets.                                                                                     
| |  |                                                                                                                                                                                                                      |    
| |  | Consolidated
 Total Assets means, at any date, the aggregate of:                                                                                                                                                  
| |  |                                                                                                                                                                                                                      |     |                                                                                                                                                                                                                                                                                                                                                            
| |  |                                                                                                                                                                                                                      | (a) | the then
 current market values of all vessels owned by any member of the Group (in the
 case of a Vessel or any other vessel, the market value shall be determined by
 reference only to the most recent valuation of such Vessel or vessel in
 accordance with Clause 11.11);                                                                            
| |  |                                                                                                                                                                                                                      |     |                                                                                                                                                                                                                                                                                                                                                            
| |  |                                                                                                                                                                                                                      | (b) | the then
 current aggregate amount of cash, Marketable Securities (but no other bonds,
 notes or bills and less any cash or Marketable Securities accounted for in
 the definition of Consolidated Total Liabilities below) and receivables due
 to the Group (less provision for bad and doubtful debts) as shown in the
 latest financial statements; and
| |  |                                                                                                                                                                                                                      |     |                                                                                                                                                                                                                                                                                                                                                            
| |  |                                                                                                                                                                                                                      | (c) | the book
 values of all other assets (other than the assets referred to in
 sub-paragraphs (a) and (b) hereof) as shown in such latest financial
 statements.                                                                                                                                                                                              

3

---



| |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | 
| |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | 
| |  | Consolidated
 Total Liabilities means, at the relevant date and for a
 particular period, the aggregate of the consolidated Financial Indebtedness
 of the Group shown in the latest consolidated financial statements for the
 Group (excluding (i) liabilities to its shareholders, provided that they are
 subordinated on terms acceptable to the Lender in its discretion and (ii)
 debt that is fully collateralised by cash or Marketable Securities to which
 the right of access, use or dealing is blocked for any member of the Group
 solely to secure that debt).
| |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | 
| |  | Converted
 means actually or notionally (as the case may require) converted by the
 Lender at the rate at which the Lender, in accordance with its usual
 practice, is able in the London Interbank market to purchase the Permitted
 Currency in which any part of the Loan is to be denominated with the
 Permitted Currency in which the Loan is then denominated, on the second
 Business Day before the value date for that conversion pursuant to Clause 5,
 and the words Convert and Conversion shall be interpreted
 accordingly.                                
| |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | 
| |  | Corporate
 Guarantee means the guarantee and indemnity referred to in Clause
 11.1.5                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | 
| |  | Corporate
 Guarantor means Safe Bulkers Inc., a company incorporated
 according to the laws of the Republic of Marshall Islands or such other
 company which shall be its successor in title.                                                                                                                                                                                                                                                                                                                                                                                 
| |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | 
| |  | Credit
 Support Document means any document described as such in the
 Master Agreement and, where the context permits, any other document referred
 to in any Credit Support Document which has the effect of creating an
 Encumbrance in favour of the Lender.                                                                                                                                                                                                                                                                                                               
| |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | 
| |  | Credit
 Support Provider means any person (other than the Borrower)
 described as such in the Master Agreement.                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | 
| |  | Currency
 of Account means, in relation to any payment to be made to the
 Lender under a Finance Document, the currency in which that payment is
 required to be made by the terms of that Finance Document.                                                                                                                                                                                                                                                                                                                                                                  

4

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| |  |                                                                                                                                                                                                                                                                                                                                  |     |                                                                                                                                                                                                            
| |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Current
 Shareholders means the shareholders of the Corporate Guarantor
 who beneficially hold directly or indirectly not less than fifty one per cent
 (51%) of the shares in the Corporate Guarantor on the Signing Date.                                                                                                   
| |  |                                                                                                                                                                                                                                                                                                                                  |    
| |  | Debt
 means the aggregate (as of the date of calculation) of all obligations of the
 Group then outstanding for the payment or repayment of Financial Indebtedness
 as stated in the Accounting Information then most recently required to be
 delivered pursuant to Clauses 13.1.1 and 13.1.2 including, without
 limitation:
| |  |                                                                                                                                                                                                                                                                                                                                  |    
| |  |                                                                                                                                                                                                                                                                                                                                  | (a) | any amounts
 payable by the Group under leases, including, but not limited to, time
 chartering contracts, or similar arrangements over their respective periods;                                          
| |  |                                                                                                                                                                                                                                                                                                                                  |     |                                                                                                                                                                                                            
| |  |                                                                                                                                                                                                                                                                                                                                  | (b) | any credit
 to the Group from a supplier of goods or under any installment purchase or
 other similar arrangement;                                                                                         
| |  |                                                                                                                                                                                                                                                                                                                                  |     |                                                                                                                                                                                                            
| |  |                                                                                                                                                                                                                                                                                                                                  | (c) | the
 aggregate amount then outstanding of liabilities and obligations of third
 parties to the extent that they are guaranteed by the Group;                                                               
| |  |                                                                                                                                                                                                                                                                                                                                  |     |                                                                                                                                                                                                            
| |  |                                                                                                                                                                                                                                                                                                                                  | (d) | any
 contingent liabilities (including any taxes or other payments under dispute
 or arbitration) which have been or, under GAAP, should be recorded in the
 notes to the Groups financial statements; and
| |  |                                                                                                                                                                                                                                                                                                                                  |     |                                                                                                                                                                                                            
| |  |                                                                                                                                                                                                                                                                                                                                  | (e) | any deferred
 tax liabilities.                                                                                                                                                                             
| |  |                                                                                                                                                                                                                                                                                                                                  |    
| |  | Deed of
 Covenants means the deed of covenants referred to in Clause
 11.1.1.                                                                                                                                                                                                                                                 
| |  |                                                                                                                                                                                                                                                                                                                                  |    
| |  | Default
 means an Event of Default or any event or circumstance specified in Clause
 14.1 which would (with the expiry of a grace period, the giving of notice,
 the making of any determination under the Finance Documents or any
 combination of any of the foregoing) be an Event of Default.                             
| |  |                                                                                                                                                                                                                                                                                                                                  |    
| |  | Delivery Date means the
 date of actual delivery of the Vessel to the Borrower by the Seller under the
 Ship Sale Contract.                                                                                                                                                                                                   

5

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| |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | 
| |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | 
| |  | DOC
 means, in relation to the ISM Company, a valid Document of Compliance issued
 for the ISM Company by the Administration under paragraph 13.2 of the ISM
 Code.                                                                                                                                                                                                                                                                                                                                                                                                           
| |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | 
| |  | Dollars
 and $
 each means available and freely transferable and convertible funds in lawful
 currency of the United States of America.                                                                                                                                                                                                                                                                                                                                                                                                                                     
| |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | 
| |  | Drawdown
 Date means the date on which a Drawing is advanced under Clause
 4.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | 
| |  | Drawdown
 Notice means a notice substantially in the form set out in
 Schedule 3.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | 
| |  | Drawing
 means any one amount advanced or to be advanced pursuant to a Drawdown Notice
 or, where the context permits, the amount advanced and for the time being
 outstanding and Drawings means more than one of them.                                                                                                                                                                                                                                                                                                                                                    
| |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | 
| |  | Earnings
 means all hires, freights, pool income and other sums payable to or for the
 account of the Borrower in respect of the Vessel including (without
 limitation) all remuneration for salvage and towage services, demurrage and
 detention moneys, contributions in general average, compensation in respect
 of any requisition for hire, and damages and other payments (whether awarded
 by any court or arbitral tribunal or by agreement or otherwise) for breach,
 termination or variation of any contract for the operation, employment or use
 of the Vessel.
| |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | 
| |  | EBITDA
 on a consolidated basis of the Group means the earnings before interest,
 expenses and other financial charges, taxes, depreciation and amortization
 (for the previous period of twelve months).                                                                                                                                                                                                                                                                                                                                                                     
| |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | 
| |  | Efragel
 means Efragel Shipping Corporation, a company incorporated according to the
 laws of the Republic of Liberia or such other company which shall be its
 successor in title.                                                                                                                                                                                                                                                                                                                                                                                           
| |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | 
| |  | Efragel
 Agreement means the reducing revolving multi-currency credit
 facility agreement dated 11 January 2008, as amended and supplemented by a
 first supplemental agreement dated 22 May 2008, each made between Efragel, as                                                                                                                                                                                                                                                                                                                                              

6

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| |  |                                                                                                                                                                                                                                                                                                                                   | 
| |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | 
| |  | borrower and
 the Lender, as lender, as the same may be further amended and/or supplemented
 and/or novated from time to time.                                                                                                                                                                                                   
| |  |                                                                                                                                                                                                                                                                                                                                   | 
| |  | Efragel
 Indebtedness means the Indebtedness as such term is defined in
 the Efragel Agreement.                                                                                                                                                                                                                                
| |  |                                                                                                                                                                                                                                                                                                                                   | 
| |  | Encumbrance
 means a mortgage, charge, assignment, pledge, lien, or other security
 interest securing any obligation of any person or any other agreement or
 arrangement having a similar effect.                                                                                                                             
| |  |                                                                                                                                                                                                                                                                                                                                   | 
| |  | Eniadefhi
 Guarantees means the guarantees and indemnities to be granted by
 the Borrower in favour of the Lender in respect of each of the Pelea
 Indebtedness, the Efragel Indebtedness, the Marindou Indebtedness, the Avstes
 Indebtedness and the Eniaprohi Indebtedness and Eniadefhi Guarantee means
 any one of them.
| |  |                                                                                                                                                                                                                                                                                                                                   | 
| |  | Eniaprohi
 means Eniaprohi Shipping Corporation, a company incorporated according to the
 laws of the Republic of Liberia or such other company which shall be its
 successor in title.                                                                                                                                        
| |  |                                                                                                                                                                                                                                                                                                                                   | 
| |  | Eniaprohi
 Agreement means the reducing revolving multi-currency credit
 facility agreement entered or to be entered between Eniaprohi, as borrower
 and the Lender, as lender, as the same may be amended and/or supplemented
 and/or novated from time to time.                                                              
| |  |                                                                                                                                                                                                                                                                                                                                   | 
| |  | Eniaprohi
 Indebtedness means the Indebtedness as such term is defined in
 the Eniaprohi Agreement.                                                                                                                                                                                                                            
| |  |                                                                                                                                                                                                                                                                                                                                   | 
| |  | Euro
 and 
 means the single currency of the Participating Member States.                                                                                                                                                                                                                                                   
| |  |                                                                                                                                                                                                                                                                                                                                   | 
| |  | Event of
 Default means any of the events or circumstances set out in
 Clause 14.1.                                                                                                                                                                                                                                            
| |  |                                                                                                                                                                                                                                                                                                                                   | 
| |  | Existing
 Charter means in respect of the Vessel the time charter dated 8
 November 2007 made between the Managers and the Charterer, as the same may be
 amended and/or supplemented and/or novated from time to time.                                                                                                        

7

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| |  |                                                                                                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                    
| |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Facility
 Period means the period beginning on the Signing Date and ending
 on the date when the whole of the Indebtedness has been paid in full and the
 Security Parties have ceased to be under any further actual or contingent
 liability to the Lender under or in connection with the Finance Documents.
| |  |                                                                                                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                    
| |  | Final
 Maturity Date means the date falling on the earlier of (a) ten
 (10) years from the Delivery Date and (b) 28 February 2019.                                                                                                                                                                             
| |  |                                                                                                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                    
| |  | Finance
 Documents means this Agreement, the Master Agreement, the
 Security Documents and any other document designated as such by the Lender
 and the Borrower and Finance Document means any one of them.                                                                                                 
| |  |                                                                                                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                    
| |  | Financial
 Indebtedness means any obligation for the payment or repayment of
 money, whether present or future, actual or contingent, in respect of:                                                                                                                                                           
| |  |                                                                                                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                    
| |  | (a)                                                                                                                                                                                                                                                                                                               | moneys
 borrowed;                                                                                                                                                                                                                  
| |  |                                                                                                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                    
| |  | (b)                                                                                                                                                                                                                                                                                                               | any
 acceptance credit;                                                                                                                                                                                                            
| |  |                                                                                                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                    
| |  | (c)                                                                                                                                                                                                                                                                                                               | any bond,
 note, debenture, loan stock or similar instrument;                                                                                                                                                                      
| |  |                                                                                                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                    
| |  | (d)                                                                                                                                                                                                                                                                                                               | any finance
 or capital lease;                                                                                                                                                                                                     
| |  |                                                                                                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                    
| |  | (e)                                                                                                                                                                                                                                                                                                               | receivables
 sold or discounted (other than on a non-recourse basis);                                                                                                                                                              
| |  |                                                                                                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                    
| |  | (f)                                                                                                                                                                                                                                                                                                               | deferred
 payments for assets or services;                                                                                                                                                                                         
| |  |                                                                                                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                    
| |  | (g)                                                                                                                                                                                                                                                                                                               | any derivative
 transaction protecting against or benefiting from fluctuations in any rate or
 price (and, when calculating the value of any derivative transaction, only
 the marked to market value shall be taken into account);
| |  |                                                                                                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                    
| |  | (h)                                                                                                                                                                                                                                                                                                               | any amount
 raised under any other transaction (including any forward sale or purchase
 agreement) having the commercial effect of a borrowing;                                                                                    
| |  |                                                                                                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                    
| |  | (i)                                                                                                                                                                                                                                                                                                               | any
 counter-indemnity obligation in respect of a guarantee, indemnity, bond,
 standby or documentary letter of credit or any other instrument issued by a
 bank or financial institution; and                                     

8

---



| |  |                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                        
| |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------
| |  | (j)                                                                                                                                                                                                                                                                                                                                                                                                                                   | the amount
 of any liability in respect of any guarantee or indemnity for any of the
 items referred to in paragraphs (a) to (i) above.
| |  |                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                        
| |  | GAAP
 means generally accepted accounting principles in the United States of
 America.                                                                                                                                                                                                                                                                                                                                             
| |  |                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                        
| |  | Group
 means the Corporate Guarantor and its Subsidiaries.                                                                                                                                                                                                                                                                                                                                                                         
| |  |                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                        
| |  | Group
 Guarantees means the guarantees and indemnities of the Group
 Guarantors referred to in Clause 11.1.4, and Group Guarantee means any
 one of them.                                                                                                                                                                                                                                                                        
| |  |                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                        
| |  | Group
 Guarantors means Efragel, Pelea, Avstes, Eniaprohi and Marindou,
 and Group
 Guarantor means any one of them.                                                                                                                                                                                                                                                                                                             
| |  |                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                        
| |  | Guarantees
 means the Corporate Guarantee and the Group Guarantees and Guarantee
 means any one of them.                                                                                                                                                                                                                                                                                                                         
| |  |                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                        
| |  | Guarantors
 means the Corporate Guarantor and the Group Guarantors, and Guarantor
 means any one of them.                                                                                                                                                                                                                                                                                                                        
| |  |                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                        
| |  | IAPPC
 means a valid international air pollution prevention certificate for the
 Vessel issued under Annex VI.                                                                                                                                                                                                                                                                                                                     
| |  |                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                        
| |  | Indebtedness
 means the aggregate from time to time of: the amount of the Loan outstanding;
 all accrued and unpaid interest oil the Loan; and all other sums of any
 nature (together with all accrued and unpaid interest on any of those sums)
 payable to the Lender under all or any of the Finance Documents.                                                                                                                
| |  |                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                        
| |  | Insurances
 means all policies and contracts of insurance (including all entries in
 protection and indemnity or war risks associations) which are from time to
 time taken out or entered into in respect of or in connection with the Vessel
 or her increased value or the Earnings and (where the context permits) all
 benefits under such contracts and policies, including all claims of any
 nature and returns of premium.
| |  |                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                        
| |  | Interest
 Payment Date means each date for the payment of interest in
 accordance with Clause 8.7.                                                                                                                                                                                                                                                                                                                                 

9

---



| |  |                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                          
| |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Interest
 Period means each period for the determination and payment of
 interest selected by the Borrower or agreed or selected by the Lender
 pursuant to Clause 8.                                                                                                                                           
| |  |                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                          
| |  | ISM Code
 means the International Management Code for the Safe Operation of Ships and
 for Pollution Prevention.                                                                                                                                                                                                
| |  |                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                          
| |  | ISM
 Company means, at any given time, the company responsible for the
 Vessels compliance with the ISM Code under paragraph 1.1.2 of the ISM Code.                                                                                                                                                            
| |  |                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                          
| |  | ISPS Code
 means the International Ship and Port Facility Security Code.                                                                                                                                                                                                                                        
| |  |                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                          
| |  | ISPS
 Company means, at any given time, the company responsible for the
 Vessels compliance with the ISPS Code.                                                                                                                                                                                                
| |  |                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                          
| |  | ISSC
 means a valid international ship security certificate for the Vessel issued
 under the ISPS Code.                                                                                                                                                                                                         
| |  |                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                          
| |  | LIBOR
 means:                                                                                                                                                                                                                                                                                                   
| |  |                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                          
| |  | (a)                                                                                                                                                                                                                                                                                                                | the
 applicable Screen Rate; or                                                                                                                                                          
| |  |                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                          
| |  | (b)                                                                                                                                                                                                                                                                                                                | (if no
 Screen Rate is available for any Interest Period) the arithmetic mean of the rates (rounded upwards to four
 decimal places) quoted to the Lender in the London interbank market,
| |  |                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                          
| |  | at 11.00
 a.m. two (2) Business Days before the first day of the relevant Interest
 Period for the offering of deposits in Dollars or its equivalent in a
 Permitted Currency in an amount comparable to the Loan (or any relevant part
 of the Loan) and for a period comparable to the relevant Interest Period.
| |  |                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                          
| |  | Loan
 means the aggregate amount advanced or to be advanced by the Lender to the
 Borrower under Clause 4 or, where the context permits, the amount advanced
 and for the time being outstanding.                                                                                                               
| |  |                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                          
| |  | Management
 Agreement means the agreement(s) for the commercial and/or
 technical management of the Vessel between the Borrower and the Managers.                                                                                                                                                               

10

---



| |  |                                                                                                                                                                                                                                                                                                                                                                     | 
| |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | 
| |  | Managers
 means Safety Management Overseas S.A., or such other commercial and/or
 technical managers of the Vessel nominated by the Borrower as the Lender may
 approve.                                                                                                                                                                                         
| |  |                                                                                                                                                                                                                                                                                                                                                                     | 
| |  | Mandatory
 Cost means the percentage rate per annum calculated by the Lender
 in accordance with Schedule 2.                                                                                                                                                                                                                                                     
| |  |                                                                                                                                                                                                                                                                                                                                                                     | 
| |  | Margin
 means zero point ninety per cent (0.90%) per annum.                                                                                                                                                                                                                                                                                                      
| |  |                                                                                                                                                                                                                                                                                                                                                                     | 
| |  | Marindou
 means Marindou Shipping Corporation, a company incorporated according to the
 laws of the Republic of Liberia or such other company which shall be its successor
 in title.                                                                                                                                                                            
| |  |                                                                                                                                                                                                                                                                                                                                                                     | 
| |  | Marindou
 Agreement means the reducing revolving multi-currency credit
 facility agreement dated 11 January 2008, as amended and supplemented by a
 first supplemental agreement dated 22 May 2008, each made between Marindou,
 as borrower and the Lender, as lender, as the same may be further amended
 and/or supplemented and/or novated from time to time.
| |  |                                                                                                                                                                                                                                                                                                                                                                     | 
| |  | Marindou
 Indebtedness means the Indebtedness as such term is defined in
 the Marindou Agreement.                                                                                                                                                                                                                                                                
| |  |                                                                                                                                                                                                                                                                                                                                                                     | 
| |  | Marketable
 Securities means any bonds, stocks, notes or bills payable in a
 freely convertible and transferable currency and which are listed on a stock
 exchange acceptable to the Lender.                                                                                                                                                                    
| |  |                                                                                                                                                                                                                                                                                                                                                                     | 
| |  | Master
 Agreement means any ISDA Master Agreement (or any other form of
 master agreement relating to interest or currency exchange transactions)
 entered into between the Lender and the Borrower during the Facility Period,
 including each Schedule to any Master Agreement and each Confirmation
 exchanged pursuant to any Master Agreement.              
| |  |                                                                                                                                                                                                                                                                                                                                                                     | 
| |  | Maximum
 Amount means forty five million Dollars ($45,000,000) reduced
 from time to time in accordance with Clause 3.4 and/or Clause 7.4 and/or
 Clause 8.9.5.                                                                                                                                                                                                  
| |  |                                                                                                                                                                                                                                                                                                                                                                     | 
| |  | Mortgage
 means the first priority statutory mortgage referred to in Clause 11.1.1
 together with the Deed of Covenants.                                                                                                                                                                                                                                         

11

---



| |  |                                                                                                                                                                                                                                                                                                                                                                                                                                   | 
| |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | 
| |  | Mortgagees
 Insurances means all policies and contracts of mortgagees
 interest insurance from time to time taken out by the Lender in relation to
 the Vessel.                                                                                                                                                                                                                                                              
| |  |                                                                                                                                                                                                                                                                                                                                                                                                                                   | 
| |  | Net Worth
 means Consolidated Total Assets less Consolidated Total Liabilities.                                                                                                                                                                                                                                                                                                                                                
| |  |                                                                                                                                                                                                                                                                                                                                                                                                                                   | 
| |  | Operating
 Account means the bank account opened in the name of the Managers
 with the Lender and designated Eniadefhi Shipping Corporation  Operating
 Account with account numbers 63646001.                                                                                                                                                                                                                              
| |  |                                                                                                                                                                                                                                                                                                                                                                                                                                   | 
| |  | Participating
 Member States means any member state of the European Community
 that adopts or has adopted the Euro as its lawful currency in accordance with
 legislation of the European Community relating to Economic and Monetary
 Union.                                                                                                                                                                                  
| |  |                                                                                                                                                                                                                                                                                                                                                                                                                                   | 
| |  | Pelea
 means Pelea Shipping Ltd., a company incorporated according to the laws of
 the Republic of Liberia or such other company which shall be its successor in
 title.                                                                                                                                                                                                                                                       
| |  |                                                                                                                                                                                                                                                                                                                                                                                                                                   | 
| |  | Pelea
 Agreement means the reducing revolving multi-currency credit
 facility agreement dated 12 June 2007, as amended and supplemented by a
 supplemental agreement dated 22 May 2008, and as further amended and
 supplemented by a second supplemental agreement dated 25 September 2008, each
 made between Pelea and the Lender, as the same may be further amended and/or
 supplemented and/or novated from time to time.
| |  |                                                                                                                                                                                                                                                                                                                                                                                                                                   | 
| |  | Pelea
 Indebtedness means the Indebtedness as such term is defined in
 the Pelea Agreement.                                                                                                                                                                                                                                                                                                                                    
| |  |                                                                                                                                                                                                                                                                                                                                                                                                                                   | 
| |  | Permitted
 Currency means Japanese Yen, Swiss Francs, Euro and Dollars.                                                                                                                                                                                                                                                                                                                                                        
| |  |                                                                                                                                                                                                                                                                                                                                                                                                                                   | 
| |  | Reduction
 Date means each date falling at consecutive six monthly intervals
 after the first Drawdown Date.                                                                                                                                                                                                                                                                                                                   
| |  |                                                                                                                                                                                                                                                                                                                                                                                                                                   | 
| |  | Relevant
 Documents means the Finance Documents, the Management Agreement
 and the Managers confirmation specified in Part I of Schedule 1.                                                                                                                                                                                                                                                                                   

12

---



| |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | 
| |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | 
| |  | Requisition
 Compensation means all compensation or other money which may from
 time to time be payable to the Borrower as a result of the Vessel being
 requisitioned for title or in any other way compulsorily acquired (other than
 by way of requisition for hire).                                                                                                                                                                                                                        
| |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | 
| |  | Screen
 Rate means in relation to LIBOR, the British Bankers Association
 Interest Settlement Rate for the relevant currency and period displayed on
 the appropriate page of the Reuters screen. If the agreed page is replaced or
 the service ceases to be available, the Lender may specify another page or
 service displaying the appropriate rate after consultation with the Borrower.                                                                                                 
| |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | 
| |  | Security
 Documents means the Mortgage, the Deed of Covenants, the
 Assignment, the Accounts Charge, the Guarantees, any other Credit Support
 Documents or (where the context permits) any one or more of them and any
 other agreement or document which may at any time be executed by any person
 as security for the payment of all or any part of the Indebtedness and Security
 Document means any one of them.                                                                        
| |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | 
| |  | Security
 Parties means the Borrower, the Guarantors and any other Credit
 Support Provider and any other person who may at any time during the Facility
 Period be liable for, or provide security for, all or any part of the
 Indebtedness, and Security Party means any one of them.                                                                                                                                                                                                      
| |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | 
| |  | Seller
 means Itochu Corporation, a corporation organized and existing under the laws
 of Japan, having its registered office at 5-1, Kita-Aoyama 2 chome, Minato-ku,
 Tokyo, 107-8077, Japan.                                                                                                                                                                                                                                                                                                  
| |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | 
| |  | Ship Sale
 Contract means the contract dated 28 August 2006, as the same may
 be amended and/or supplemented and/or novated and/or replaced from time to
 time, made between the Borrower, as buyer, and the Seller, as seller, on the
 terms and subject to the conditions of which the Seller has agreed to cause
 the Builder to construct, equip and complete the Vessel at one of the
 Builders shipyards in Yokohama or Kure, Japan, and to sell and deliver the
 Vessel to the Borrower.

13

---



| |  |                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                             
| |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Side
 Letter means the side letter evidencing the Current Shareholders
 of the Corporate Guarantor on the Signing Date issued by the Corporate
 Guarantor in favour of the Lender in such form as the Lender may require.
| |  |                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                             
| |  | Signing
 Date means the date of signing of this Agreement which shall
 occur no later than 25 September 2008.                                                                                                            
| |  |                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                             
| |  | SMC
 means a valid safety management certificate issued for the Vessel by or on
 behalf of the Administration under paragraph 13.7 of the ISM Code.                                                                      
| |  |                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                             
| |  | SMS
 means a safety management system for the Vessel developed and implemented in
 accordance with the ISM Code.                                                                                                         
| |  |                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                             
| |  | Subsidiary
 has the meaning ascribed to it by section 1159 of the Companies Act 2006 (as
 the same may be amended and/or supplemented from time to time), and Subsidiaries
 shall be interpreted accordingly.          
| |  |                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                             
| |  | Swiss
 Francs and SFr means available and freely
 transferable and convertible funds in non-resident currency of Switzerland.                                                                                          
| |  |                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                             
| |  | Tax
 means any tax, levy, impost, duty or other charge or withholding of a similar
 nature (including any penalty or interest payable in connection with any
 failure to pay or any delay in paying any of the same).    
| |  |                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                             
| |  | Total Loss
 means:                                                                                                                                                                                                       
| |  |                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                             
| |  | (a)                                                                                                                                                                                                                         | an actual,
 constructive, arranged, agreed or compromised total loss of the Vessel; or                                                                                                                                                                                                                                                      
| |  |                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                             
| |  | (b)                                                                                                                                                                                                                         | the
 requisition for title or compulsory acquisition of the Vessel by any
 government or other competent authority (other than by way of requisition for
 hire); or                                                                                                                                                                         
| |  |                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                             
| |  | (c)                                                                                                                                                                                                                         | the capture,
 seizure, arrest, detention or confiscation of the Vessel by any government or
 by persons acting or purporting to act on behalf of any government, unless
 the Vessel is released and returned to the possession of the Borrower within
 one month after the capture, seizure, arrest, detention or confiscation in
 question.

14

---



| |     |                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     | Transaction
 means a transaction entered into between the Lender and the Borrower governed
 by the Master Agreement.                                                                                                                                                                                                                                                                   
| |     |                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                
| |     | Vessel
 means the approximately 87,000 dwt panamax dry bulk carrier vessel MARTINE
 with Builders hull number 3255, which will be delivered in January 2009 and
 which will be registered upon its delivery in the ownership of the Borrower
 under the laws and flag of the Republic of Cyprus together with everything
 now or in the future belonging to her on board and ashore.
| |     |                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                
| |     | Japanese
 Yen and ¥ means available and freely
 transferable and convertible funds in non-resident currency of Japan.                                                                                                                                                                                                                                                                
| |     |                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                
| | 1.2 | In this
 Agreement:                                                                                                                                                                                                                                                                                                                                                                      
| |     |                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                
| |     | 1.2.1                                                                                                                                                                                                                                                                                                                                                                                     | words
 denoting the plural number include the singular and vice versa;                                                                                                                                                                         
| |     |                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                
| |     | 1.2.2                                                                                                                                                                                                                                                                                                                                                                                     | words
 denoting persons include corporations, partnerships, associations of persons
 (whether incorporated or not) or governmental or quasi-governmental bodies
 or authorities and vice versa;                                                
| |     |                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                
| |     | 1.2.3                                                                                                                                                                                                                                                                                                                                                                                     | references
 to Recitals, Clauses and Schedules are references to recitals, clauses and
 schedules to or of this Agreement;                                                                                                                     
| |     |                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                
| |     | 1.2.4                                                                                                                                                                                                                                                                                                                                                                                     | references
 to this Agreement include the Recitals and the Schedules;                                                                                                                                                                          
| |     |                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                
| |     | 1.2.5                                                                                                                                                                                                                                                                                                                                                                                     | the headings
 and contents page(s) are for the purpose of reference only, have no legal or
 other significance, and shall be ignored in the interpretation of this
 Agreement;                                                                 
| |     |                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                
| |     | 1.2.6                                                                                                                                                                                                                                                                                                                                                                                     | references
 to any document (including, without limitation, to all or any of the Relevant
 Documents) are, unless the context otherwise requires, references to that
 document as amended, supplemented, novated or replaced from time to time;
| |     |                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                
| |     | 1.2.7                                                                                                                                                                                                                                                                                                                                                                                     | references
 to statutes or provisions of statutes are references to those statutes, or
 those provisions, as from time to time amended, replaced or re-enacted;                                                                                
| |     |                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                
| |     | 1.2.8                                                                                                                                                                                                                                                                                                                                                                                     | references
 to the Lender include its successors, transferees and assignees;                                                                                                                                                                   

15

---



|  |                           |                                                                                                                                                                                                                                          |                                                                                                                       
|- | ------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------
|  |                           | 1.2.9                                                                                                                                                                                                                                    | a time of
 day (unless otherwise specified) is a reference to London time; and                                        
|  |                           |                                                                                                                                                                                                                                          |                                                                                                                       
|  |                           | 1.2.10                                                                                                                                                                                                                                   | words and
 expressions defined in the Master Agreement, unless the context otherwise
 requires, have the same meaning.
|  |                           |                                                                                                                                                                                                                                          |                                                                                                                       
|  | 1.3                       | Offer letter                                                                                                                                                                                                                            
|  |                           |                                                                                                                                                                                                                                          |                                                                                                                       
|  |                           | This
 Agreement supersedes the terms and conditions contained in any correspondence
 relating to the subject matter of this Agreement exchanged between the Lender
 and the Borrower or their representatives prior to the Signing Date.
|  |                           |                                                                                                                                                                                                                                          |                                                                                                                       
|2 | The Loan and its Purpose 
|  |                           |                                                                                                                                                                                                                                          |                                                                                                                       
|  | 2.1                       | Amount Subject to
 the terms of this Agreement, the Lender agrees to make available to the
 Borrower a revolving credit facility in an aggregate amount not exceeding the
 Maximum Amount at any one time.                              
|  |                           |                                                                                                                                                                                                                                          |                                                                                                                       
|  | 2.2                       | Purpose The
 Borrower shall apply the Loan for the purpose referred to in Recital (B).                                                                                                                                                  
|  |                           |                                                                                                                                                                                                                                          |                                                                                                                       
|  | 2.3                       | Monitoring The
 Lender shall not be bound to monitor or verify the application of any amount
 borrowed under this Agreement.                                                                                                            
|  |                           |                                                                                                                                                                                                                                          |                                                                                                                       
|3 | Conditions of Utilisation
|  |                           |                                                                                                                                                                                                                                          |                                                                                                                       
|  | 3.1                       | Conditions precedent
 The Borrower is not entitled to have any Drawing advanced unless the Lender
 has received all of the documents and other evidence listed in Part I of
 Schedule 1.                                                
|  |                           |                                                                                                                                                                                                                                          |                                                                                                                       
|  | 3.2                       | Further conditions precedent
 The Lender will only be obliged to advance a Drawing if on the date of the
 Drawdown Notice and on the proposed Drawdown Date:                                                                            
|  |                           |                                                                                                                                                                                                                                          |                                                                                                                       
|  |                           | 3.2.1                                                                                                                                                                                                                                    | no Default
 is continuing or would result from the advance of that Drawing; and                                       
|  |                           |                                                                                                                                                                                                                                          |                                                                                                                       
|  |                           | 3.2.2                                                                                                                                                                                                                                    | the
 representations made by the Borrower under Clause 12 are true in all material
 respects.                         

16

---



| |     |                                                                         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | --- | ----------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | 3.3 | Drawing limit The
 Lender will only be obliged to advance a Drawing if:
| |     |                                                                         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| |     | 3.3.1                                                                   | no other
 Drawing has been made on the same Business Day;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| |     |                                                                         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| |     | 3.3.2                                                                   | that Drawing
 is not less than one million Dollars ($1,000,000) or, if in excess of one
 million Dollars ($1,000,000), integral multiples of five hundred thousand
 Dollars ($500,000); and                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| |     |                                                                         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| |     | 3.3.3                                                                   | that Drawing
 will not increase the outstanding amount of the Loan to a sum in excess of
 the Maximum Amount.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| |     |                                                                         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | 3.4 | Reduction of Maximum Amount
 The Maximum Amount:                       
| |     |                                                                         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| |     | 3.4.1                                                                   | shall be
 reduced by twenty (20) reduction amounts, the first nineteen (19) reduction
 amounts on each of the Reduction Dates, each reduction amount in the amount
 of one million one hundred and twenty five thousand Dollars ($1,125,000) and
 the final reduction amount in the amount of twenty three million six hundred
 and twenty five thousand Dollars ($23,625,000) (comprising of a reduction
 amount of one million one hundred and twenty five thousand Dollars
 ($1,125,000) and a balloon reduction of twenty two million five hundred
 thousand Dollars ($22,500,000)), the first Reduction Date being the date
 which is six (6) calendar months from the Delivery Date and subsequent
 Reduction Dates being at consecutive intervals of six (6) calendar months
 thereafter, with the last Reduction Date being on the Final Maturity Date;
 and
| |     |                                                                         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| |     | 3.4.2                                                                   | may (in
 addition to any reduction required under Clause 3.4.1) be reduced by the
 Borrower by five hundred thousand Dollars ($500,000) or an integral multiple
 of that amount with effect from any Business Day by written notice to the
 Lender given not fewer than fourteen (14) days prior to that Business Day,
 which notice shall be irrevocable. Any voluntary reduction in the Maximum
 Amount shall be in addition to, and without prejudice to, the mandatory
 reductions in the Maximum Amount made pursuant to Clause 3.4.1 and may not be
 reversed. Any reduction under this Clause 3.4.2 shall satisfy the obligations
 under Clause 3.4.1 in order of maturity. Amounts repaid by the Borrower
 pursuant to this Clause shall not be available for reborrowing.                                                                                  

17

---



|  |                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                 
|- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------
|  | 3.5                                                                                                                                                                                                                                                                                                  | Conditions subsequent
 The Borrower undertakes to deliver or to cause to be delivered to the Lender
 on, or as soon as practicable after, the first Drawdown Date the additional
 documents and other evidence listed in Part II of Schedule 1.                                                                                                                                 
|  |                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                 
|  | 3.6                                                                                                                                                                                                                                                                                                  | No Waiver If the
 Lender in its sole discretion agrees to advance a Drawing to the Borrower
 before all of the documents and evidence required by Clause 3.1 have been
 delivered to or to the order of the Lender, the Borrower undertakes to
 deliver all outstanding documents and evidence to or to the order of the
 Lender no later than the date specified by the Lender.
|  |                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                 
|  |                                                                                                                                                                                                                                                                                                      | The advance
 of a Drawing under this Clause 3.6 shall not be taken as a waiver of the
 Lenders right to require production of all the documents and evidence
 required by Clause 3.1.                                                                                                                                                                                          
|  |                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                 
|  | 3.7                                                                                                                                                                                                                                                                                                  | Form and content
 All documents and evidence delivered to the Lender under this Clause 3 shall:                                                                                                                                                                                                                                                                                 
|  |                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                 
|  |                                                                                                                                                                                                                                                                                                      | 3.7.1                                                                                                                                                                                                                                                                                                                                                                            | be in form
 and substance acceptable to the Lender;                                                                                                             
|  |                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                 
|  |                                                                                                                                                                                                                                                                                                      | 3.7.2                                                                                                                                                                                                                                                                                                                                                                            | if required
 by the Lender, be certified, notarised, legalised or attested in a manner
 acceptable to the Lender; and                                           
|  |                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                 
|  |                                                                                                                                                                                                                                                                                                      | 3.7.3                                                                                                                                                                                                                                                                                                                                                                            | if copies,
 be certified as true and complete copies by a director or the secretary or
 the legal advisor or a duly authorised attorney-in-fact of the Borrower.
|  |                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                 
|4 | Advance                                                                                                                                                                                                                                                                                             
|  |                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                 
|  | The Borrower
 may request a Drawing to be advanced in one amount on any Business Day prior
 to the Availability Termination Date by delivering to the Lender a duly
 completed Drawdown Notice not more than ten (10) and not fewer than three (3)
 Business Days before the proposed Drawdown Date.
|  |                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                 
|5 | Currency                                                                                                                                                                                                                                                                                            
|  |                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                 
|  | 5.1                                                                                                                                                                                                                                                                                                  | Conversion The
 Borrower may Convert all or any part of the Loan into a Permitted Currency
 not later than five (5) Business Days before the Drawdown Date or at any time
 during the Facility Period, subject to there being no Event of Default which
 is continuing and subject to the Permitted Currency being                                                              

18

---



|  |           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | 
|- | --------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | 
|  |           | available to
 the Lender. Upon conversion, that part of the Loan shall remain denominated
 in, and shall be repayable in, the Permitted Currency until the end of the
 relevant Interest Payment Date. Clause 3.4 shall be amended so that the
 Maximum Amount of the Loan shall be reduced in the Permitted Currency or
 Permitted Currencies selected under this Clause, provided that the Reduction
 Dates specified in Clause 3.4 shall not be changed.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|  |           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | 
|  | 5.2       | Indemnity The
 Borrower shall indemnify the Lender from time to time on demand against all
 Break Costs, other losses, costs, claims, damages and expenses which the
 Lender may from time to time suffer, incur or sustain by reason of the Lender
 agreeing to and/or implementing the terms of this Clause (including, without
 limitation, all costs and expenses incurred by the Lender in effecting any
 conversion).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|  |           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | 
|6 | Repayment
|  |           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | 
|  | 6.1       | Repayment of each Drawing
 The Borrower agrees to repay each Drawing to the Lender on the last day of
 the Interest Period in respect of that Drawing. On the Final Maturity Date
 the Borrower shall repay to the Lender all amounts then outstanding under or
 pursuant to this Agreement. Without limitation to the repayments required by
 Clause 3.4, in addition the Borrower may repay any Drawing in whole or in
 part in integral multiples of five hundred thousand Dollars ($500,000) (or
 the equivalent in the Permitted Currency in which the Drawing in question is
 then denominated) and no repayment shall be made in an amount which is less
 than one million Dollars ($1,000,000) (or the equivalent in the Permitted
 Currency in which the Drawing in question is then denominated) (or as
 otherwise may be agreed by the Lender) provided that it has first given to
 the Lender not fewer than two (2) Business Days prior written notice
 expiring on a Business Day of its intention to do so. Any notice pursuant to
 this Clause once given shall be irrevocable and shall oblige the Borrower to
 make the repayment referred to in the notice on the Business Day specified in
 the notice, together with all interest accrued on the amount repaid up to and
 including that Business Day and any repaid amount shall not be available for
 reborrowing.

19

---



|  |            |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                       
|- | ---------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|7 | Prepayment
|  |            |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                       
|  | 7.1        | Illegality If it
 becomes unlawful in any jurisdiction for the Lender to perform any of its
 obligations as contemplated by this Agreement or to fund or maintain the
 Loan:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|  |            |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                       
|  |            | 7.1.1                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | the Lender
 shall promptly notify the Borrower of that event; and                                                                                                                                                                                                     
|  |            |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                       
|  |            | 7.1.2                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | the Borrower
 shall repay any Drawing on the last day of its current Interest Period or, if
 earlier, the date specified by the Lender in the notice delivered to the
 Borrower (being no earlier than the last day of any applicable grace period
 permitted by law).
|  |            |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                       
|  | 7.2        | Voluntary prepayment of Loan
 The Borrower may prepay the whole or any part of a Drawing (but, if in part,
 being an amount that reduces that Drawing by a minimum amount of five hundred
 thousand Dollars ($500,000) or an integral multiple of that amount (or as
 otherwise may be agreed by the Lender) provided that it gives the Lender not
 less than fourteen (14) Business Days (or such shorter period of the notice
 as the Lender may agree) prior notice. Amounts prepaid by the Borrower
 pursuant to this Clause shall be available for reborrowing in accordance with
 Clause 3 prior to the Availability Termination Date. Any prepayment under
 this Clause 7.2 shall satisfy the obligations under Clause 6.1 in order of
 maturity.
|  |            |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                       
|  | 7.3        | Mandatory prepayment on sale or Total Loss
 Upon the sale or Total Loss of the Vessel, the Maximum Amount shall reduce to
 zero and the Borrower shall repay the Indebtedness in full, in the case of a
 sale of the Vessel, by not later than the date of the sale of the Vessel or,
 in the case of a Total Loss, by not later than the date falling one hundred
 and eighty (180) days from the date of the casualty giving rise to the Total
 Loss (or such longer period as the Lender may in its discretion agree).
 Amounts prepaid by the Borrower pursuant to this Clause shall not be
 available for reborrowing.                                                                                                                              
|  |            |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                       
|  | 7.4        | Mandatory prepayment on reduction of
 Maximum Amount If the Maximum Amount is reduced in
 accordance with Clause 3.4 to an amount which is less than the aggregate
 amount of the Drawings then outstanding, the Borrower shall, simultaneously
 with that reduction, prepay one or more outstanding Drawings to                                                                                                                                                                                                                                                                                                                                                                                                                                         

20

---



|  |          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               | 
|- | -------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | 
|  |          | the extent
 required to ensure that the aggregate amount of the Drawings outstanding does
 not exceed the reduced Maximum Amount.                                                                                                                                                                                                                                                                                                                                                            
|  |          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               | 
|  | 7.5      | Restrictions Any
 notice of prepayment given under this Clause 7 shall be irrevocable and,
 unless a contrary indication appears in this Agreement, shall specify the date
 or dates upon which the relevant prepayment is to be made and the amount of
 that prepayment.                                                                                                                                                                                                                    
|  |          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               | 
|  |          | Any
 prepayment under this Agreement shall be made together with accrued interest
 on the amount prepaid and, subject to any Break Costs, without premium or
 penalty.                                                                                                                                                                                                                                                                                                                       
|  |          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               | 
|8 | Interest
|  |          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               | 
|  | 8.1      | Interest Periods
 The period during which each Drawing shall be outstanding under this
 Agreement shall be an Interest Period of one (1), three (3), six (6), nine
 (9) or twelve (12) months duration, as selected by the Borrower in the
 Drawdown Notice in respect of the Drawing in question, or such other duration
 as may be agreed by the Lender, provided that the Borrower shall not select
 more than three (3) Interest Periods of one (1) months duration per calendar
 year.
|  |          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               | 
|  | 8.2      | Beginning and end of Interest Periods
 Each Interest Period shall start on the Drawdown Date of the Drawing in
 question and end on the date which numerically corresponds to that Drawdown
 Date in the relevant calendar month except that, if there is no numerically
 corresponding date in that calendar month, the Interest Period shall end on
 the last Business Day in that month.                                                                                                  
|  |          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               | 
|  | 8.3      | Interest Periods to meet Maturity Date
 If an Interest Period for a Drawing would otherwise expire after the Maturity
 Date, the Interest Period for that Drawing shall expire on the Maturity Date.                                                                                                                                                                                                                                                                                         
|  |          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               | 
|  | 8.4      | Non-Business Days
 If an Interest Period would otherwise end on a day which is not a Business
 Day, that Interest Period will instead end on the next Business Day in that
 calendar month (if there is one) or the preceding Business Day (if there is
 not).                                                                                                                                                                                                                               

21

---



| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | 
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | 
| | 8.5 | Interest rate
 During each Interest Period interest shall accrue on the relevant Drawing at
 the rate determined by the Lender to be the aggregate of (a) the Margin, (b)
 LIBOR and (c) the Mandatory Cost, if any.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | 
| | 8.6 | Failure to select Interest Period
 If the Borrower at any time fails to select or agree an Interest Period in
 accordance with Clause 8.1, the interest rate applicable shall be the rate
 determined by the Lender in accordance with Clause 8.5 for an Interest Period
 of such duration (not exceeding six months) as the Lender may select.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | 
| | 8.7 | Accrual and payment of interest
 Interest shall accrue from day to day, shall be calculated on the basis of a
 360 day year and the actual number of days elapsed (or, in any circumstance
 where market practice differs, in accordance with the prevailing market
 practice) and shall be paid by the Borrower to the Lender on the last day of
 each Interest Period and, if the Interest Period is longer than six (6)
 months, on the dates falling at six (6) monthly intervals after the first day
 of that Interest Period.                                                                                                                                                                                                                                                                                                                                        
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | 
| | 8.8 | Default interest
 If the Borrower fails to pay any amount payable by it under a Finance Document
 on its due date, interest shall accrue on the overdue amount from the due
 date up to the date of actual payment (both before and after judgment) at a
 rate which is one per cent (1%) higher than the rate which would have been
 payable if the overdue amount had, during the period of non-payment,
 constituted a Drawing in the currency of the overdue amount for successive
 Interest Periods, each selected by the Lender (acting reasonably). Any
 interest accruing under this Clause 8.8 shall be immediately payable by the
 Borrower on demand by the Lender. If unpaid, any such interest will be
 compounded with the overdue amount at the end of each Interest Period
 applicable to that overdue amount but will remain immediately due and
 payable.
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | 
| | 8.9 | Changes in market circumstances
 If at any time the Lender determines (which determination shall be final and
 conclusive and binding on the Borrower) that, by reason of changes affecting
 the London interbank market, adequate and fair means do not exist for
 determining the rate of interest on a Drawing for any Interest Period:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 

22

---



| |      |                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                     
| | ---- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |      | 8.9.1                                                                                                                                                                                                                                     | the Lender
 shall give notice to the Borrower of the occurrence of such event; and                                                                                                                                                                                                                                                                                                                                                                                                                
| |      |                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |      | 8.9.2                                                                                                                                                                                                                                     | the rate of
 interest on the relevant Drawing for that Interest Period shall be the rate per
 annum which is the sum of:                                                                                                                                                                                                                                                                                                                                                                          
| |      |                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |      |                                                                                                                                                                                                                                           | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                | the Margin;
 and                                                                                                                                                    
| |      |                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                     
| |      |                                                                                                                                                                                                                                           | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                | the rate
 which expresses as a percentage rate per annum the cost to the Lender of
 funding the relevant Drawing from whatever source it may reasonably select;
 and
| |      |                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                     
| |      |                                                                                                                                                                                                                                           | (c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                | the Mandatory
 Cost, if any,                                                                                                                                        
| |      |                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |      | PROVIDED
 THAT if the resulting rate of interest is not acceptable to the Borrower:                                                                                                                                                      
| |      |                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |      | 8.9.3                                                                                                                                                                                                                                     | the Lender
 will negotiate with the Borrower in good faith with a view to modifying this
 Agreement to provide a substitute basis for determining the rate of interest
 which is financially a substantial equivalent to the basis provided for in
 this Agreement;                                                                                                                                                                                                                               
| |      |                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |      | 8.9.4                                                                                                                                                                                                                                     | any
 substitute basis agreed pursuant to Clause 8.9.3 shall be binding on the
 parties to this Agreement; and                                                                                                                                                                                                                                                                                                                                                                                     
| |      |                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |      | 8.9.5                                                                                                                                                                                                                                     | if, within
 thirty (30) days of the giving of the notice referred to in Clause 8.9.1, the
 Borrower and the Lender fail to agree in writing on a substitute basis for
 determining the rate of interest in respect of the relevant Drawing, the
 Lender shall cease to be obliged to advance that Drawing, but, if it has
 already been advanced, the Borrower will immediately prepay it, together with
 any Break Costs, and the Maximum Amount shall be reduced by the amount of
 that Drawing.
| |      |                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| | 8.10 | Determinations conclusive
 The Lender shall promptly notify the Borrower of the determination of a rate
 of interest under this Clause 8 and each such determination shall (save in
 the case of manifest error) be final and conclusive.

23

---



|  |             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                                                                                                                                                                                
|- | ----------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|9 | Indemnities
|  |             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                                                                                                                                                                                
|  | 9.1         | Transaction expenses
 The Borrower will, within fourteen (14) days of the Lenders written demand,
 pay the Lender the amount of all costs and expenses (including legal fees and
 Value Added Tax or any similar or replacement tax if applicable) incurred by
 the Lender in connection with:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|  |             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                                                                                                                                                                                
|  |             | 9.1.1                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | the
 negotiation, preparation, printing, execution and registration of the Finance
 Documents (whether or not any Finance Document is actually executed or
 registered and whether or not a Drawing is advanced);                                                                                                                              
|  |             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                                                                                                                                                                                
|  |             | 9.1.2                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | any
 amendment, addendum or supplement to any Finance Document (whether or not
 completed); and                                                                                                                                                                                                                                                
|  |             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                                                                                                                                                                                
|  |             | 9.1.3                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | any other
 document which may at any time be required by the Lender to give effect to
 any Finance Document or which the Lender is entitled to call for or obtain
 under any Finance Document (including, without limitation, all premiums and
 other sums from time to time payable by the Lender in relation to the
 Mortgagees Insurances).
|  |             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                                                                                                                                                                                
|  | 9.2         | Funding costs The
 Borrower shall indemnify the Lender on the Lenders written demand against
 all losses and costs incurred or sustained by the Lender if, for any reason,
 a Drawing is not advanced to the Borrower after the relevant Drawdown Notice
 has been given to the Lender, or is advanced on a date other than that
 requested in the Drawdown Notice (unless, in either case, as a result of any
 default by the Lender).                                                                                                                                                                                                                                                                                                                                                                                                          
|  |             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                                                                                                                                                                                
|  | 9.3         | Break Costs The
 Borrower shall indemnify the Lender on the Lenders written demand against
 all costs, losses, premiums or penalties incurred by the Lender as a result
 of its receiving any prepayment of all or any part of a Drawing (whether
 pursuant to Clause 7 or otherwise) on a day other than the last day of an
 Interest Period for that Drawing, or any other payment under or in relation
 to the Finance Documents on a day other than the due date for payment of the
 sum in question, including (without limitation) any losses or costs incurred
 in liquidating or re-employing deposits from third parties acquired to
 effect or maintain all or any part of a Drawing, and any liabilities,
 expenses or losses incurred by the Lender in terminating or reversing, or
 otherwise in connection with, any Transaction or

24

---



| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                     
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     | any other
 interest rate and/or currency swap, transaction or arrangement entered into
 by the Lender to hedge any exposure arising under this Agreement, or in
 terminating or reversing, or otherwise in connection with, any open position
 arising under this Agreement or the Master Agreement.                                                                                                                                                                                                                                                                                                         
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                     
| | 9.4 | Currency indemnity
 In the event of the Lender receiving or recovering any amount payable under a
 Finance Document in a currency other than the Currency of Account, and if the
 amount received or recovered is insufficient when Converted into the Currency
 of Account at the date of receipt to satisfy in full the amount due, the
 Borrower shall, on the Lenders written demand, pay to the Lender such
 further amount in the Currency of Account as is sufficient to satisfy in full
 the amount due and that further amount shall be due to the Lender as a
 separate debt under this Agreement.
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                     
| | 9.5 | Increased costs (subject to Clause 9.6)
 If, by reason of the introduction of any law, or any change in any law, or
 any change in the interpretation or administration of any law, or compliance
 with any request or requirement from any central bank or any fiscal, monetary
 or other authority occurring after the Signing Date:                                                                                                                                                                                                                                                                       
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                     
| |     | 9.5.1                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | the Lender
 (or the holding company of the Lender) shall be subject to any Tax with
 respect to payment of all or any part of the Indebtedness (other than Tax on
 overall net income); or                                                                                          
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                     
| |     | 9.5.2                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | the basis of
 Taxation of payments to the Lender in respect of all or any part of the
 Indebtedness shall be changed; or                                                                                                                                                            
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                     
| |     | 9.5.3                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | any reserve
 requirements shall be imposed, modified or deemed applicable against assets
 held by or deposits in or for the account of or loans by any branch of the
 Lender; or                                                                                                    
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                     
| |     | 9.5.4                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | the manner
 in which the Lender allocates capital resources to its obligations under this
 Agreement and/or the Master Agreement or any ratio (whether cash, capital
 adequacy, liquidity or otherwise) which the Lender is required or requested
 to maintain shall be affected; or

25

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| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                         
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------------------------------------
| |     | 9.5.5                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | there is
 imposed on the Lender (or on the holding company of the Lender) any other
 condition in relation to the Indebtedness or the Finance Documents;
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                         
| |     | and the
 result of any of the above shall be to increase the cost to the Lender (or to
 the holding company of the Lender) of the Lender making or maintaining the
 Loan, or its obligations under the Master Agreement to cause the Lender to
 suffer (in its opinion) a material reduction in the rate of return on its
 overall capital below the level which it reasonably anticipated at the
 Signing Date and which it would have been able to achieve but for its
 entering into this Agreement or the Master Agreement and/or performing its
 obligations under this Agreement or the Master Agreement, then, subject to
 Clause 9.6, the Lender shall notify the Borrower and the Borrower shall from
 time to time pay to the Lender on demand the amount which shall compensate
 the Lender (or the holding company of the Lender) for such additional cost or
 reduced return. A certificate signed by an authorised signatory of the Lender
 setting out the amount of that payment and the basis of its calculation shall
 be submitted to the Borrower and shall be conclusive evidence of such amount
 save for manifest error or on any question of law.
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                         
| | 9.6 | Exceptions to increased costs
 Clause 9.5 does not apply to the extent any additional cost or reduced return
 referred to in that Clause is:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                         
| |     | 9.6.1                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | compensated
 for by a payment made under Clause 9.10; or                                                                                                
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                         
| |     | 9.6.2                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | compensated
 for by a payment made under Clause 17.3; or                                                                                                
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                         
| |     | 9.6.3                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | compensated
 for by the payment of the Mandatory Cost; or                                                                                               
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                         
| |     | 9.6.4                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | attributable
 to the wilful breach by the Lender (or the holding company of the Lender) of
 any law or regulation.                                      
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                         
| | 9.7 | Events of Default
 The Borrower shall indemnify the Lender from time to time on the Lenders
 written demand against all losses, costs and liabilities incurred or
 sustained by the Lender as a consequence of any Event of Default.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                         
| | 9.8 | Enforcement costs
 The Borrower shall pay to the Lender on the Lenders written demand the
 amount of all costs and expenses (including legal fees) incurred by the
 Lender in connection with the enforcement of, or the preservation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   

26

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|   |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | 
|-- | ---- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | 
|   |      | of any
 rights under, any Finance Document including (without limitation) any losses,
 costs and expenses which the Lender may from time to time sustain, incur or
 become liable for by reason of the Lender being mortgagee of the Vessel
 and/or a lender to the Borrower, or by reason of the Lender being deemed by
 any court or authority to be an operator or controller, or in any way
 concerned in the operation or control, of the Vessel.                                                                                                                                                                                                                                                                                                                          
|   |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | 
|   | 9.9  | Other costs The
 Borrower shall pay to the Lender on the Lenders written demand the amount of
 all sums which the Lender may pay or become actually or contingently liable
 for on account of the Borrower in connection with the Vessel (whether alone
 or jointly or jointly and severally with any other person) including (without
 limitation) all sums which the Lender may pay or guarantees which it may give
 in respect of the Insurances, any expenses incurred by the Lender in
 connection with the maintenance or repair of the Vessel or in discharging any
 lien, bond or other claim relating in any way to the Vessel, and any sums
 which the Lender may pay or guarantees which it may give to procure the
 release of the Vessel from arrest or detention.
|   |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | 
|   | 9.10 | Taxes The Borrower
 shall pay all Taxes to which all or any part of the Indebtedness or any
 Finance Document may be at any time subject (other than Tax on the Lenders
 overall net income) and shall indemnify the Lender on the Lenders written
 demand against all liabilities, costs, claims and expenses resulting from any
 omission to pay or delay in paying any such Taxes.                                                                                                                                                                                                                                                                                                                                                                                         
|   |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | 
|10 | Fees
|   |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | 
|   | 10.1 | Commitment fee The
 Borrower shall pay to the Lender a fee computed at the rate of zero point
 twenty per cent (0.20%) per annum on the undrawn Maximum Amount from time to
 time from the Signing Date until the Availability Termination Date. The
 accrued commitment fee is payable on the last day of each successive period
 of three (3) months from the Signing Date and on the Availability Termination
 Date.                                                                                                                                                                                                                                                                                                                                                         
|   |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | 
|   | 10.2 | Arrangement fee
 The Borrower shall pay to the Lender on the Signing Date an arrangement fee
 in the amount of ninety thousand Dollars ($90,000).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               

27

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|   |                                    |                                                                                                                                                                                                                                                                                              |                                                                                                                      
|-- | ---------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------------------------------------
|11 | Security and Application of Moneys
|   |                                    |                                                                                                                                                                                                                                                                                              |                                                                                                                      
|   | 11.1                               | Security Documents
 As security for the payment of the Indebtedness, the Borrower shall execute
 and deliver to the Lender or cause to be executed and delivered to the Lender
 the following documents in such forms and containing such terms and
 conditions as the Lender shall require:
|   |                                    |                                                                                                                                                                                                                                                                                              |                                                                                                                      
|   |                                    | 11.1.1                                                                                                                                                                                                                                                                                       | a first
 priority Cypriot statutory mortgage over the Vessel together with a
 collateral deed of covenants;          
|   |                                    |                                                                                                                                                                                                                                                                                              |                                                                                                                      
|   |                                    | 11.1.2                                                                                                                                                                                                                                                                                       | a first
 priority deed of assignment of the Insurances, Earnings and Requisition
 Compensation of the Vessel;        
|   |                                    |                                                                                                                                                                                                                                                                                              |                                                                                                                      
|   |                                    | 11.1.3                                                                                                                                                                                                                                                                                       | a first
 priority deed of charge over the Accounts and all amounts from time to time
 standing to the credit of them;
|   |                                    |                                                                                                                                                                                                                                                                                              |                                                                                                                      
|   |                                    | 11.1.4                                                                                                                                                                                                                                                                                       | a guarantee
 and indemnity from each Group Guarantor; and                                                            
|   |                                    |                                                                                                                                                                                                                                                                                              |                                                                                                                      
|   |                                    | 11.1.5                                                                                                                                                                                                                                                                                       | a guarantee
 and indemnity from the Corporate Guarantor.                                                             
|   |                                    |                                                                                                                                                                                                                                                                                              |                                                                                                                      
|   | 11.2                               | Accounts The
 Borrower shall maintain the Accounts with the Lender for the duration of the
 Facility Period free of Encumbrances and rights of set off other than those
 created by or under the Finance Documents.                                                                         
|   |                                    |                                                                                                                                                                                                                                                                                              |                                                                                                                      
|   | 11.3                               | Earnings The
 Borrower shall procure that all Earnings and any Requisition Compensation are
 credited to the Operating Account.                                                                                                                                                             
|   |                                    |                                                                                                                                                                                                                                                                                              |                                                                                                                      
|   | 11.4                               | Application of Operating Account
 The Borrower shall procure that there is transferred from the Operating
 Account to the Lender:                                                                                                                                                           
|   |                                    |                                                                                                                                                                                                                                                                                              |                                                                                                                      
|   |                                    | 11.4.1                                                                                                                                                                                                                                                                                       | on the due
 date for repayment of each Drawing, the amount of that Drawing; and                                      
|   |                                    |                                                                                                                                                                                                                                                                                              |                                                                                                                      
|   |                                    | 11.4.2                                                                                                                                                                                                                                                                                       | on each
 Interest Payment Date in respect of a Drawing, the amount of interest due in
 respect of that Drawing,      
|   |                                    |                                                                                                                                                                                                                                                                                              |                                                                                                                      
|   |                                    | and the
 Borrower irrevocably authorises the Lender to make those transfers.                                                                                                                                                                                                                
|   |                                    |                                                                                                                                                                                                                                                                                              |                                                                                                                      
|   | 11.5                               | Borrowers obligations not affected
 If for any reason the amount standing to the credit of the Operating Account
 is insufficient to repay any Drawing or to                                                                                                                               

28

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| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                          
| | ---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------------------------
| |      | make any
 payment of interest when due, the Borrowers obligation to repay that Drawing
 or to make that payment of interest shall not be affected.                                                                                                                                                                                                                                                                            
| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                          
| | 11.6 | Release of surplus
 Any amount remaining to the credit of the Operating Account following the
 making of any transfer required by Clause 11.4 shall (unless a Default shall
 have occurred and be continuing) be released to or to the order of the
 Borrower, subject to an amount of one hundred and fifty thousand Dollars
 ($150,000) remaining credited to the Operating Account at all times during
 the Facility Period.
| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                          
| | 11.7 | Relocation of Accounts
 At any time following the occurrence and during the continuation of a
 Default, the Lender may without the consent of the Borrower relocate either
 or both of the Accounts to any other branch of the Lender, without prejudice
 to the continued application of this Clause 11 and the rights of the Lender
 under the Finance Documents.                                                            
| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                          
| | 11.8 | Application after acceleration
 From and after the giving of notice to the Borrower by the Lender under
 Clause 14.2, the Borrower shall procure that all sums from time to time
 standing to the credit of either of the Accounts are immediately transferred
 to the Lender for application in accordance with Clause 11.9 and the Borrower
 irrevocably authorises the Lender to make those transfers.                      
| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                          
| | 11.9 | General application of moneys
 The Borrower, subject to Clause 11.10, irrevocably authorises the Lender to
 apply all sums which the Lender may receive:                                                                                                                                                                                                                                                                       
| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                          
| |      | 11.9.1                                                                                                                                                                                                                                                                                                                                                                                                                          | pursuant to
 a sale or other disposition of the Vessel or any right, title or interest in
 the Vessel; or
| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                          
| |      | 11.9.2                                                                                                                                                                                                                                                                                                                                                                                                                          | by way of
 payment of any sum in respect of the Insurances, Earnings or Requisition
 Compensation; or    
| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                          
| |      | 11.9.3                                                                                                                                                                                                                                                                                                                                                                                                                          | by way of
 transfer of any sum from either of the Accounts; or                                           
| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                          
| |      | 11.9.4                                                                                                                                                                                                                                                                                                                                                                                                                          | otherwise
 arising under or in connection with any Security Document,                                    
| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                          
| |      | in or
 towards satisfaction, or by way of retention on account, of the Indebtedness,
 in such manner as the Lender may determine.                                                                                                                                                                                                                                                                                              

29

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| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | 
| | ----- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | 
| | 11.10 | Application of moneys on sale or Total Loss
 The Borrower irrevocably authorises the Lender to apply all sums which the
 Lender may receive pursuant to a sale by the Borrower of the Vessel or a
 Total Loss in or towards satisfaction of the prepayment due and payable by
 virtue of that sale or Total Loss under Clause 7.3, but the Borrowers
 obligation to make that prepayment shall not be affected if those sums are
 insufficient to satisfy that obligation.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | 
| | 11.11 | Determination of market value
 For the purpose of the Security Documents, the market value of the Vessel
 shall be the average value certified by two of the Brokers, who shall report
 directly to the Lender and shall be appointed by the Borrower not later than
 five (5) days after the Lenders request for the Borrower to appoint such
 Brokers. In the event that the Borrower fails to appoint such Brokers within
 five (5) days after the Lenders request so to do or if a Broker appointed by
 the Borrower is not approved by the Lender and the Borrower fails to appoint
 an alternative Broker who is approved by the Lender within such five (5) day
 period, the Borrower irrevocably authorises the Lender to appoint a Broker in
 its discretion to conduct such valuations. All valuations pursuant to this
 Clause shall be made on the basis of a sale of the Vessel for prompt delivery
 for cash at arms length on normal commercial terms by a willing seller to a
 willing buyer and free of any existing charter or other contract of
 employment. The Borrower agrees to accept each valuation obtained pursuant to
 this Clause as conclusive evidence of the Vessels market value at the date
 of such valuation.
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | 
| | 11.12 | Cost of valuation
 The Borrower shall be liable for all costs and expenses incurred by the
 Lender in obtaining up to two valuations in each year of the Facility Period,
 such valuations to be provided by the Borrower semi-annually and annually
 throughout the Facility Period at a time which shall coincide with the
 provision of the Compliance Certificate in accordance with Clause 13.1.3 and
 13.1.2 (the first such valuation to be provided within six (6) months after
 the Signing Date) unless there is an Event of Default in which case the
 Borrower shall be liable for all costs and expenses incurred by the Lender in
 obtaining any number of valuations required by it pursuant to Clause 11.11
 and shall reimburse the Lender in respect of all such costs and expenses on
 demand.                                                                                                                                                                                                                                                                                                                                                                                                                                    

30

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| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| | ----- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | 11.13 | Provision of information
 The Borrower undertakes promptly to supply the Lender with such information
 concerning the Vessels condition, location and employment as the Lender may
 reasonably require.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| | 11.14 | Additional security
 If and so often as the aggregate of the market value of the Vessel
 (determined in accordance with Clause 11.11) plus the value of any additional
 security for the time being provided to the Lender pursuant to this Clause
 shall be less than (a) one hundred per cent (100%) of the amount of the Loan,
 for the period commencing on the first Drawdown Date and ending on the third
 anniversary of the first Drawdown Date or (b) one hundred and ten per cent
 (110%) of the amount of the Loan from the third anniversary of the first
 Drawdown Date until the sixth anniversary of the first Drawdown Date or (c)
 one hundred and twenty per cent (120%) of the amount of the Loan thereafter,
 the Borrower will, within fourteen (14) days of the request of the Lender to
 do so, at the Borrowers option:-
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| |       | 11.14.1                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | pay to the
 credit of the Cash Collateral Account such amount as shall be necessary to
 establish that the aggregate of the market value of the Vessel (determined in
 accordance with Clause 11.11) plus the value of any additional security for
 the time being provided to the Lender pursuant to this Clause shall be no
 less than (a) one hundred per cent (100%) of the amount of the Loan, for the
 period commencing on the first Drawdown Date and ending on the third
 anniversary of the first Drawdown Date, or (b) one hundred and ten per cent
 (110%) of the amount of the Loan from the third anniversary of the first
 Drawdown Date until the sixth anniversary of the first Drawdown Date or (c)
 one hundred and twenty per cent (120%) of the amount of the Loan thereafter;
 or
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| |       | 11.14.2                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | give to the
 Lender other security in amount and form acceptable to the Lender in its
 discretion; or                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| |       | 11.14.3                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | repay such
 amount of the Loan as shall be necessary to establish that the aggregate of
 the market value of the Vessel (determined in accordance with Clause 11.11)
 plus the value of any additional security for the time being provided to the
 Lender pursuant to this Clause shall be no less than                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               

31

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| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | ----- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | (a) one
 hundred per cent (100%) of the amount of the Loan, for the period commencing
 on the first Drawdown Date and ending on the third anniversary of the first
 Drawdown Date, or (b) one hundred and ten per cent (110%) of the amount of
 the Loan from the third anniversary of the first Drawdown Date until the
 sixth anniversary of the first Drawdown Date or (c) one hundred and twenty
 per cent (120%) of the amount of the Loan thereafter.
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| |       | Clauses 7.2,
 7.3 and 7.4 shall apply, mutatis mutandis, to any repayment made pursuant to
 this Clause and the value of any additional security provided pursuant to
 this Clause shall be determined by the Lender in its discretion.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | 11.15 | Return of additional security
 If and so often as the aggregate of the market value of the Vessel
 (determined in accordance with Clause 11.11) plus the value of any additional
 security for the time being provided to the Lender pursuant to Clause 11.14
 shall exceed (a) one hundred per cent (100%) of the amount of the Loan, for
 the period commencing on the first Drawdown Date and ending on the third
 anniversary of the first Drawdown Date, or (b) one hundred and ten per cent
 (110%) of the amount of the Loan from the third anniversary of the first
 Drawdown Date until the sixth anniversary of the first Drawdown Date or (c)
 one hundred and twenty per cent (120%) of the amount of the Loan thereafter,
 then the Lender shall, within fourteen (14) days of the request of the
 Borrower to do so, release to the Borrower such portion of the amount
 standing to the credit of the Cash Collateral Account in accordance with
 Clause 11.14 and/or such amount of the security referred to in Clause 11.14.2
 as shall be required to ensure that the aggregate of the market value of the
 Vessel (determined as aforesaid) plus the value of any additional security
 for the time being provided to the Lender pursuant to Clause 11.14 is equal
 to, but not less than (a) one hundred per cent (100%) of the amount of the
 Loan, for the period commencing on the first Drawdown Date and ending on the
 third anniversary of the first Drawdown Date, or (b) one hundred and ten per
 cent (110%) of the amount of the Loan from the third anniversary of the first
 Drawdown Date until the sixth anniversary of the first Drawdown Date or (c)
 one hundred and twenty per cent (120%) of the amount of the Loan thereafter.

32

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|   |                 |                                                                                                                                        |                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                              
|-- | --------------- | -------------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|12 | Representations
|   |                 |                                                                                                                                        |                                                                                                                                                                                                                                                                                                      
|   | 12.1            | Representations
 The Borrower makes the representations and warranties set out in this Clause
 12.1 to the Lender on the Signing Date.
|   |                 |                                                                                                                                        |                                                                                                                                                                                                                                                                                                      
|   |                 | 12.1.1                                                                                                                                 | Status Each
 Security Party (which is not an individual) which is a corporation, duly
 incorporated and validly existing under the law of its jurisdiction of
 incorporation and has the power to own its assets and carry on its business
 as it is being conducted.                                
|   |                 |                                                                                                                                        |                                                                                                                                                                                                                                                                                                      
|   |                 | 12.1.2                                                                                                                                 | Binding obligations
 The obligations expressed to be assumed by each Security Party in each
 Finance Document to which it is a party are legal, valid, binding and
 enforceable obligations.                                                                                                         
|   |                 |                                                                                                                                        |                                                                                                                                                                                                                                                                                                      
|   |                 | 12.1.3                                                                                                                                 | Non-conflict with other obligations
 The entry into and performance by each Security Party of, and the
 transactions contemplated by, the Finance Documents do not conflict with:                                                                                                                    
|   |                 |                                                                                                                                        |                                                                                                                                                                                                                                                                                                      
|   |                 |                                                                                                                                        | (a)                                                                                                                                                                                                                                                                                                   | any law or
 regulation applicable to that Security Party;                                                                                                                                                                                                    
|   |                 |                                                                                                                                        |                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                              
|   |                 |                                                                                                                                        | (b)                                                                                                                                                                                                                                                                                                   | the
 constitutional documents of that Security Party; or                                                                                                                                                                                                     
|   |                 |                                                                                                                                        |                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                              
|   |                 |                                                                                                                                        | (c)                                                                                                                                                                                                                                                                                                   | any document
 binding on that Security Party or any of its assets,                                                                                                                                                                                           
|   |                 |                                                                                                                                        |                                                                                                                                                                                                                                                                                                      
|   |                 |                                                                                                                                        | and in
 borrowing the Loan, the Borrower is acting for its own account.                                                                                                                                                                                                                              
|   |                 |                                                                                                                                        |                                                                                                                                                                                                                                                                                                      
|   |                 | 12.1.4                                                                                                                                 | Power and authority
 Each Security Party has the power to enter into, perform and deliver, and has
 taken all necessary action to authorise its entry into, performance and
 delivery of, the Finance Documents to which it is a party and the
 transactions contemplated by those Finance Documents.
|   |                 |                                                                                                                                        |                                                                                                                                                                                                                                                                                                      
|   |                 | 12.1.5                                                                                                                                 | Validity and admissibility in evidence
 All consents, licences, approvals, authorisations, filings and registrations
 required or desirable:                                                                                                                                                         
|   |                 |                                                                                                                                        |                                                                                                                                                                                                                                                                                                      
|   |                 |                                                                                                                                        | (a)                                                                                                                                                                                                                                                                                                   | to enable each
 Security Party lawfully to enter into, exercise its rights and comply with
 its obligations in the Finance Documents to which it is a party or to enable
 the Lender to enforce and exercise all its rights under the Finance
 Documents; and

33

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| |  |         |                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                    
| |  | ------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -----------------------------------------------------------------------------------------------------------------------------------
| |  |         | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                         | to make the
 Finance Documents to which any Security Party is a party admissible in
 evidence in its jurisdiction of incorporation,
| |  |         |                                                                                                                                                                                                                                                                                                                                                                                                                                            
| |  |         | have been
 obtained or effected and are in full force and effect, with the exception
 only of the registrations referred to in Part II of Schedule 1.                                                                                                                                                                                                                                                                                      
| |  |         |                                                                                                                                                                                                                                                                                                                                                                                                                                            
| |  | 12.1.6  | Governing law and enforcementThe
 choice of English law as the governing law of any Finance Document expressed
 to be governed by English law will be recognised and enforced in the
 jurisdiction of incorporation of each relevant Security Party, and any
 judgment obtained in England in relation to any such Finance Document will be
 recognised and enforced in the jurisdiction of incorporation of each relevant
 Security Party.
| |  |         |                                                                                                                                                                                                                                                                                                                                                                                                                                            
| |  | 12.1.7  | Deduction of Tax
 No Security Party is required under the law of its jurisdiction of
 incorporation to make any deduction for or on account of Tax from any payment
 it may make under any Finance Document.                                                                                                                                                                                                                               
| |  |         |                                                                                                                                                                                                                                                                                                                                                                                                                                            
| |  | 12.1.8  | No filing or stamp taxes
 Under the law of jurisdiction of incorporation of each relevant Security
 Party it is not necessary that the Finance Documents be filed, recorded or
 enrolled with any court or other authority in that jurisdiction or that any
 stamp, registration or similar tax be paid on or in relation to the Finance
 Documents or the transactions contemplated by the Finance Documents.                             
| |  |         |                                                                                                                                                                                                                                                                                                                                                                                                                                            
| |  | 12.1.9  | No default No
 Event of Default is continuing or might reasonably be expected to result from
 the advance of a Drawing.                                                                                                                                                                                                                                                                                                                    
| |  |         |                                                                                                                                                                                                                                                                                                                                                                                                                                            
| |  | 12.1.10 | No misleading information
 Any factual information provided by any Security Party to the Lender was true
 and accurate in all material respects as at the date is was provided.                                                                                                                                                                                                                                                            
| |  |         |                                                                                                                                                                                                                                                                                                                                                                                                                                            
| |  | 12.1.11 | Pari passu ranking
 The payment obligations of each Security Party under the Finance Documents to
 which it is a party rank at least pari passu with the claims of all its other
 unsecured and unsubordinated creditors, except for obligations mandatorily
 preferred by law applying to companies generally.                                                                                                                            

34

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|   |                                                                                                             |                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|-- | ----------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                             | 12.1.12                                                                                                                                                                                                                                         | No proceedings pending or threatened
 No litigation, arbitration or administrative proceedings of or before any
 court, arbitral body or agency have been started or (to the best of the
 Borrowers knowledge threatened) which, if adversely determined, might
 reasonably be expected to have a materially adverse effect on the business,
 assets, financial condition or credit worthiness of any Security Party.                                                                                                                                                                                                                                                
|   |                                                                                                             |                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|   |                                                                                                             | 12.1.13                                                                                                                                                                                                                                         | Disclosure of material facts
 The Borrower is not aware of any material facts or circumstances which have
 not been disclosed to the Lender and which might, if disclosed, have
 adversely affected the decision of a person considering whether or not to
 make loan facilities of the nature contemplated by this Agreement available
 to the Borrower.                                                                                                                                                                                                                                                                                                             
|   |                                                                                                             |                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|   |                                                                                                             | 12.1.14                                                                                                                                                                                                                                         | No established place of business in the UK
 or US No Security Party, other than the Corporate
 Guarantor, has an established place of business in the United Kingdom or the
 United States of America                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   |                                                                                                             |                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|   |                                                                                                             | 12.1.15                                                                                                                                                                                                                                         | Completeness of Relevant Documents
 The copies of any Relevant Documents provided or to be provided by the
 Borrower to the Lender in accordance with Clause 3 are, or will be, true and
 accurate copies of the originals and represent, or will represent, the full
 agreement between the parties to those Relevant Documents in relation to the
 subject matter of those Relevant Documents and there are no commissions,
 rebates, premiums or other payments due or to become due in connection with
 the subject matter of those Relevant Documents other than in the ordinary
 course of business or as disclosed to, and approved in writing by, the
 Lender.
|   |                                                                                                             |                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|   | 12.2                                                                                                        | Repetition Each
 representation and warranty in Clause 12.1 is deemed to be repeated by the
 Borrower by reference to the facts and circumstances then existing on the
 date of each Drawdown Notice and the first day of each Interest Period.
|   |                                                                                                             |                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|13 | Undertakings and Covenants                                                                                 
|   |                                                                                                             |                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|   | The
 undertakings and covenants in this Clause 13 remain in force for the duration
 of the Facility Period.

35

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| |      |                          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                      
| | ---- | ------------------------ | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | 13.1 | Information Undertakings
| |      |                          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| |      | 13.1.1                   | Financial statements
 The Borrower shall procure that the Corporate Guarantor supplies to the
 Lender as soon as the same become available, but in any event within one
 hundred and eighty (180) days after the end of each of its financial years,
 its audited consolidated financial statements for that financial year,
 together with a Compliance Certificate, signed by two directors of the
 Corporate Guarantor, setting out (in reasonable detail) computations as to
 compliance with Clause 13.2.21 as at the date at which those financial
 statements were drawn up.                                                                             
| |      |                          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| |      | 13.1.2                   | Interim financial statements
 The Borrower shall procure that the Corporate Guarantor supplies to the
 Lender as soon as the same become available, but in any event within ninety
 (90) days after the end of each quarter during each of the Corporate
 Guarantors financial years, its unaudited consolidated quarterly financial
 statements for that quarter, together with a Compliance Certificate to be
 provided on a semi-annual basis, signed by two directors of the Corporate
 Guarantor, setting out (in reasonable detail) computations as to compliance
 with Clause 13.2.21 as at the date at which those financial statements were
 drawn up.
| |      |                          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| |      | 13.1.3                   | Management accounts
 The Borrower or the Managers will supply to the Lender, on the earlier of (a)
 the Lenders first request and (b) within sixty (60) days of the end of each
 calendar year during the Facility Period the unaudited management accounts
 for the Vessel prepared by the Managers showing the income and expenditure
 for the Vessel for such calendar year.                                                                                                                                                                                                                                                                                
| |      |                          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| |      | 13.1.4                   | Requirements as to financial statements
 Each set of financial statements delivered by the Corporate Guarantor under
 Clauses 13.1.1 and 13.1.2 shall be:-                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| |      |                          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| |      |                          | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | prepared
 using GAAP; and                                                                                                                                            
| |      |                          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                      
| |      |                          | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | certified by
 a director of the Corporate Guarantor as fairly representing its financial
 condition as at the date at which those financial statements were drawn up.

36

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| |  |        |                                                                      |                                                                                                                                                                                                                                                                                                                                                              
| |  | ------ | -------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | 13.1.5 | Information: miscellaneous
 The Borrower shall supply to the Lender:
| |  |        |                                                                     
| |  |        | (a)                                                                  | all
 documents dispatched by the Borrower to its shareholders (or any class of
 them) or its creditors generally at the same time as they are dispatched
 other than any documents that are subject to any confidentiality restrictions
 pursuant to the New York Stock Exchange regulations that may prohibit such
 dissemination;                          
| |  |        |                                                                      |                                                                                                                                                                                                                                                                                                                                                              
| |  |        | (b)                                                                  | promptly
 upon becoming aware of them, details of any litigation, arbitration or
 administrative proceedings which are current, threatened or pending against
 any Security Party, and which might, if adversely determined, have a
 materially adverse effect on the business, assets, financial condition or
 credit worthiness of that Security Party; and
| |  |        |                                                                     
| |  |        | (c)                                                                  | promptly,
 such further information regarding the financial condition, business and
 operations of any Security Party as the Lender may reasonably request.                                                                                                                                                                                                  
| |  |        |                                                                     
| |  | 13.1.6 | Notification of default                                             
| |  |        |                                                                     
| |  |        | (a)                                                                  | The Borrower
 shall notify the Lender of any Default (and the steps, if any, being taken to
 remedy it) promptly upon becoming aware of its occurrence.                                                                                                                                                                                                      
| |  |        |                                                                      |                                                                                                                                                                                                                                                                                                                                                              
| |  |        | (b)                                                                  | Promptly
 upon a request by the Lender, the Borrower shall supply to the Lender a
 certificate signed by two of its directors or senior officers on its behalf
 certifying that no Default is continuing (or if a Default is continuing,
 specifying the Default and the steps, if any, being taken to remedy it).                                           
| |  |        |                                                                     
| |  | 13.1.7 | Know your
 customer checks If:                                    
| |  |        |                                                                     
| |  |        | (a)                                                                  | the
 introduction of or any change in (or in the interpretation, administration or
 application of) any law or regulation made after the Signing Date;                                                                                                                                                                                                       

37

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| |      |                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                             
| | ---- | -------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------
| |      |                      | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | any change
 in the status of the Borrower after the Signing Date; or                                        
| |      |                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| |      |                      | (c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | a proposed
 assignment or transfer by the Lender of any of its rights and obligations
 under this Agreement,
| |      |                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| |      |                      | obliges the
 Lender (or, in the case of (c) above, any prospective new Lender) to comply
 with know your customer or similar identification procedures in
 circumstances where the necessary information is not already available to it,
 the Borrower shall promptly upon the request of the Lender supply, or procure
 the supply of, such documentation and other evidence as is reasonably
 requested by the Lender for itself (or, in the case of (c) above, on behalf
 of any prospective new Lender) in order for the Lender (or, in the case of
 (c) above, any prospective new Lender) to carry out and be satisfied it has
 complied with all necessary know your customer or other similar checks
 under all applicable laws and regulations pursuant to the transactions contemplated
 in the Finance Documents.
| |      |                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| | 13.2 | General undertakings
| |      |                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| |      | 13.2.1               | Authorisations The
 Borrower shall promptly:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| |      |                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| |      |                      | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | obtain,
 comply with and do all that is necessary to maintain in full force and
 effect; and                
| |      |                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| |      |                      | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | supply certified
 copies to the Lender of,                                                                  
| |      |                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| |      |                      | any consent,
 licence, approval or authorisation required under any law or regulation to
 enable each Security Party to perform its obligations under the Finance
 Documents to which it is a party and to ensure the legality, validity,
 enforceability or admissibility in evidence in the jurisdiction of
 incorporation of each relevant Security Party of any Finance Document.                                                                                                                                                                                                                                                                                                                                                                                                                                           
| |      |                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| |      | 13.2.2               | Compliance with laws
 The Borrower shall comply in all respects with all laws to which it may be
 subject, if failure so to comply would materially impair its ability to
 perform its obligations under the Finance Documents.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 

38

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| |  |        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| |  | ------ | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | 13.2.3 | Conduct of business
 The Borrower shall carry on and conduct its business in a proper and
 efficient manner, file all requisite tax returns and pay all tax which
 becomes due and payable (except where contested in good faith).                                                                                                                                                                                                                                                                                     
| |  |        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| |  | 13.2.4 | Evidence of good standing
 The Borrower will from time to time if requested by the Lender provide the
 Lender with evidence in form and substance satisfactory to the Lender that
 the Security Parties and all corporate shareholders of any Security Party
 remain in good standing.                                                                                                                                                                                                                                 
| |  |        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| |  | 13.2.5 | Liquidity The
 Borrower will throughout the Facility Period maintain in the Operating Account
 at all times a minimum positive account balance free of any Encumbrances
 (other than in favour of the Lender) of not less than one hundred and fifty
 thousand Dollars ($150,000). Any undrawn amounts under this Agreement may be
 included for the purpose of this calculation and this calculation shall
 exclude cash deposited with the Lender as security for any other facility or
 in connection with Clause 5.
| |  |        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| |  | 13.2.6 | Negative pledge and no disposals
 The Borrower shall not create nor permit to subsist any Encumbrance, other
 than in favour of the Lender, or other third party right, other than in
 favour of the Lender, on or over all or any part of its present or future
 assets or undertaking nor dispose of any those assets or of all or part of
 that undertaking.                                                                                                                                                        
| |  |        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| |  | 13.2.7 | Merger The
 Borrower shall not without the prior written consent of the Lender enter into
 any amalgamation, demerger, merger or corporate reconstruction from the
 Signing Date.                                                                                                                                                                                                                                                                                                                                      
| |  |        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| |  | 13.2.8 | Change of business
 The Borrower shall not without the prior written consent of the Lender make
 any substantial change to the general nature of its business from that
 carried on at the Signing Date.                                                                                                                                                                                                                                                                                                               
| |  |        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| |  | 13.2.9 | No other business
 The Borrower shall not without the prior written consent of the Lender engage
 in any business other than the ownership, operation, chartering and
 management of the Vessel.                                                                                                                                                                                                                                                                                                                       

39

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| |  |         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| |  | ------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | 13.2.10 | No place of business in UK or US
 The Borrower shall not have an established place of business in the United
 Kingdom or the United States of America at any time during the Facility
 Period.                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| |  |         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| |  | 13.2.11 | No borrowings The
 Borrower shall not without the prior written consent of the Lender borrow any
 money (except for the Loan and unsecured Financial Indebtedness subordinated
 to the Loan) nor incur any obligations under leases.                                                                                                                                                                                                                                                                                                                                                                                                                                         
| |  |         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| |  | 13.2.12 | No substantial liabilities
 Except in the ordinary course of business and other than in favour of the
 Lender, the Borrower shall not without the prior written consent of the
 Lender incur any liability to any third party which is in the Lenders
 opinion of a substantial nature.                                                                                                                                                                                                                                                                                                                                                                                     
| |  |         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| |  | 13.2.13 | No loans or other financial commitments
 The Borrower shall not without the prior written consent of the Lender make
 any loan (other than any part the Loan to be used for the purposes set out in
 Recital (B)) nor enter into any guarantee or indemnity (other than the
 Eniadefhi Guarantees, other than any guarantee or indemnity from time to time
 required by any insurer and which is in accordance with the terms and conditions
 of clause 5 of the Deed of Covenants, the Insurances and any acceptable
 Insurance letter of undertaking) or otherwise voluntarily assume any actual
 or contingent liability in respect of any obligation of any other person.
| |  |         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| |  | 13.2.14 | Inspection of records
 The Borrower will permit the inspection of its financial records and accounts
 and procure that the Corporate Guarantor permits the inspection of the
 Corporate Guarantors financial records and accounts from time to time by the
 Lender or its nominee.                                                                                                                                                                                                                                                                                                                                                                                          
| |  |         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| |  | 13.2.15 | No change in Relevant Documents
 The Borrower shall procure that, without the prior written consent of the
 Lender, there shall be no termination of, alteration to, or waiver of any
 term of, any of the Relevant Documents.                                                                                                                                                                                                                                                                                                                                                                                                                                               
| |  |         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| |  | 13.2.16 | No change in ownership or control of the
 Borrower or the Managers The Borrower shall not
 cease to be a wholly owned Subsidiary of the                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      

40

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| |  |         |                                                                                                                                                                                                                                                                                                                                             |     |                                                                                                                               
| |  | ------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --- | ------------------------------------------------------------------------------------------------------------------------------
| |  |         | Corporate
 Guarantor and shall not permit any change in the beneficial ownership and
 control of the Managers from that advised to the Lender on the Signing Date.                                                                                                                                                                         
| |  |         |                                                                                                                                                                                                                                                                                                                                            
| |  | 13.2.17 | No purchase of a vessel
 The Borrower shall not purchase any vessel or any shares in any vessel.                                                                                                                                                                                                                                           
| |  |         |                                                                                                                                                                                                                                                                                                                                            
| |  | 13.2.18 | No dealings with Master Agreement
 The Borrower shall not assign, novate or encumber or in any other way
 transfer any of its rights or obligations under the Master Agreement, nor
 enter into any interest rate exchange or hedging agreement with anyone other
 than the Lender.                                                        
| |  |         |                                                                                                                                                                                                                                                                                                                                            
| |  | 13.2.19 | Charters The
 Borrower shall inform the Lender in respect of its entry into any charter or
 other contract of employment in respect of the Vessel (other than the
 Charters) and of any extensions, increases or decreases in charterhire or
 other material amendments to a Charter or any other charter or other contract
 of employment.
| |  |         |                                                                                                                                                                                                                                                                                                                                            
| |  | 13.2.20 | Ownership The
 Borrower shall procure that the Corporate Guarantor shall remain directly or
 indirectly beneficially owned by its Current Shareholders or any of them at a
 minimum of fifty one per cent (51%).                                                                                                                           
| |  |         |                                                                                                                                                                                                                                                                                                                                            
| |  | 13.2.21 | Financial covenants
 The Borrower shall procure that the Corporate Guarantor shall on a
 consolidated basis comply with the following financial covenants to be
 assessed on a semi-annual basis based on the basis of the Accounting
 Information received by the Lender in accordance with Clauses 13.1.1 and
 13.1.2:-                  
| |  |         |                                                                                                                                                                                                                                                                                                                                            
| |  |         |                                                                                                                                                                                                                                                                                                                                             | (a) | Consolidated Group Leverage
 The Consolidated Group Leverage shall be equal to or less than seventy per
 cent (70%).          
| |  |         |                                                                                                                                                                                                                                                                                                                                             |     |                                                                                                                               
| |  |         |                                                                                                                                                                                                                                                                                                                                             | (b) | Debt to EBITDA ratio
 The ratio of Debt to EBITDA on a trailing twelve (12) months basis shall not
 at any time exceed 5.5:1.

41

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| |      |                     |                                                                                                                                                                                                                                                                                                                                                                                                                         |     |                                                                                                                          
| | ---- | ------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --- | -------------------------------------------------------------------------------------------------------------------------
| |      |                     |                                                                                                                                                                                                                                                                                                                                                                                                                         | (c) | Net Worth The Net
 Worth shall not at any time be less than one hundred and seventy five million
 Dollars ($175,000,000).
| |      |                     |                                                                                                                                                                                                                                                                                                                                                                                                                        
| | 13.3 | Vessel undertakings
| |      |                     |                                                                                                                                                                                                                                                                                                                                                                                                                        
| |      | 13.3.1              | No sale of Vessel
 The Borrower shall not sell or otherwise dispose of the Vessel or any shares
 in the Vessel nor agree to do so without the prior written consent of the
 Lender.                                                                                                                                                                                                                                    
| |      |                     |                                                                                                                                                                                                                                                                                                                                                                                                                        
| |      | 13.3.2              | No chartering after Event of Default
 Following the occurrence and during the continuation of an Event of Default
 the Borrower shall not without the prior written consent of the Lender let
 the Vessel on charter or renew or extend any charter or other contract of
 employment of the Vessel (nor agree to do so).                                                                                               
| |      |                     |                                                                                                                                                                                                                                                                                                                                                                                                                        
| |      | 13.3.3              | No change in management
 The Borrower shall procure that, without the prior written consent of the
 Lender, there shall be no termination of, alteration to, or waiver of any
 term of, the Management Agreement and the Borrower shall not without the
 prior written consent of the Lender permit the Managers to sub-contract or
 delegate the commercial or technical management of the Vessel to any third
 party.
| |      |                     |                                                                                                                                                                                                                                                                                                                                                                                                                        
| |      | 13.3.4              | Registration of Vessel
 The Borrower undertakes to maintain the registration of the Vessel under the
 flag stated in Recital (A) (or such other flag acceptable to the Lender in
 its discretion) for the duration of the Facility Period unless the Lender
 agrees otherwise in writing.                                                                                                                              
| |      |                     |                                                                                                                                                                                                                                                                                                                                                                                                                        
| |      | 13.3.5              | Evidence of current COFR
 The Borrower will, if and for so long as the Vessel trades in the United
 States of America and Exclusive Economic Zone (as defined in the United
 States Oil Pollution Act 1990), obtain, retain and provide the Lender with a
 copy of, a valid Certificate of Financial Responsibility for the Vessel under
 that Act and will comply strictly with the requirements of that Act.         
| |      |                     |                                                                                                                                                                                                                                                                                                                                                                                                                        
| |      | 13.3.6              | ISM Code compliance
 The Borrower will:                                                                                                                                                                                                                                                                                                                                                                                

42

---



| |  |        |                                          |                                                                                                                                                                                                        
| |  | ------ | ---------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  |        | (a)                                      | procure that
 the Vessel remains for the duration of the Facility Period subject to a SMS;                                                                                                             
| |  |        |                                          |                                                                                                                                                                                                        
| |  |        | (b)                                      | maintain a
 valid and current SMC for the Vessel throughout the Facility Period and
 provide a copy to the Lender;                                                                                     
| |  |        |                                          |                                                                                                                                                                                                        
| |  |        | (c)                                      | procure that
 the ISM Company maintains a valid and current DOC throughout the Facility
 Period and provide a copy to the Lender; and                                                                  
| |  |        |                                          |                                                                                                                                                                                                        
| |  |        | (d)                                      | immediately
 notify the Lender in writing of any actual or threatened withdrawal,
 suspension, cancellation or modification of the SMC of the Vessel or of the
 DOC of the ISM Company.                
| |  |        |                                          |                                                                                                                                                                                                        
| |  | 13.3.7 | ISPS Code compliance
 The Borrower will:
| |  |        |                                         
| |  |        | (a)                                      | for the
 duration of the Facility Period comply with the ISPS Code in relation to the
 Vessel and procure that the Vessel and the ISPS Company comply with the ISPS
 Code;                             
| |  |        |                                          |                                                                                                                                                                                                        
| |  |        | (b)                                      | maintain a
 valid and current ISSC for the Vessel throughout the Facility Period and
 provide a copy to the Lender; and                                                                                
| |  |        |                                          |                                                                                                                                                                                                        
| |  |        | (c)                                      | immediately
 notify the Lender in writing of any actual or threatened withdrawal,
 suspension, cancellation or modification of the ISSC.                                                               
| |  |        |                                         
| |  | 13.3.8 | Annex VI compliance
 The Borrower will: 
| |  |        |                                         
| |  |        | (a)                                      | for the
 duration of the Facility Period comply with Annex VI in relation to the
 Vessel and procure that the Vessels master and crew are familiar with, and
 that the Vessel complies with, Annex VI;
| |  |        |                                          |                                                                                                                                                                                                        
| |  |        | (b)                                      | maintain a
 valid and current IAPPC for the Vessel throughout the Facility Period and
 provide a copy to the Lender; and                                                                               

43

---



|   |                   |                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                    
|-- | ----------------- | ----------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------
|   |                   |                                                                                                             | (c)                                                                                                                                                                                                                                                                                                                                                                           | immediately
 notify the Lender in writing of any actual or threatened withdrawal,
 suspension, cancellation or modification of the IAPPC.          
|   |                   |                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                              
|14 | Events of Default
|   |                   |                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                              
|   | 14.1              | Events of Default
 Each of the events or circumstances set out in this Clause 14.1 is an Event
 of Default.
|   |                   |                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                              
|   |                   | 14.1.1                                                                                                      | Non-payment The
 Borrower does not pay on the due date any amount payable by it under a Finance
 Document at the place at and in the currency in which it is expressed to be
 payable.                                                                                                                                                                                       
|   |                   |                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                              
|   |                   | 14.1.2                                                                                                      | Other obligations
 A Security Party or any other person (except the Lender) does not comply with
 any provision of any of the Relevant Documents to which that Security Party
 or person is a party (other than as referred to in Clause 14.1.1).                                                                                                                            
|   |                   |                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                              
|   |                   | 14.1.3                                                                                                      | Misrepresentation
 Any representation, warranty or statement made or deemed to be repeated by a
 Security Party in any Finance Document or any other document delivered by or
 on behalf of a Security Party under or in connection with any Finance
 Document is or proves to have been incorrect or misleading in any material
 respect when made or deemed to be repeated.
|   |                   |                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                              
|   |                   | 14.1.4                                                                                                      | Cross default Any
 Financial Indebtedness of a Security Party:                                                                                                                                                                                                                                                                                                               
|   |                   |                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                    
|   |                   |                                                                                                             | (a)                                                                                                                                                                                                                                                                                                                                                                           | is not paid
 when due or within any originally applicable grace period; or                                                                         
|   |                   |                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                    
|   |                   |                                                                                                             | (b)                                                                                                                                                                                                                                                                                                                                                                           | is declared
 to be, or otherwise becomes, due and payable before its specified maturity as
 a result of an event of default (however described); or
|   |                   |                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                    
|   |                   |                                                                                                             | (c)                                                                                                                                                                                                                                                                                                                                                                           | is declared
 by a creditor to be due and payable before its specified maturity as a result of such an event.                                       
|   |                   |                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                              
|   |                   | 14.1.5                                                                                                      | Insolvency                                                                                                                                                                                                                                                                                                                                                                   

44

---



| |  |        |                                                                                                                                           |                                                                                                                                                                                                                                                                                                                           
| |  | ------ | ----------------------------------------------------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  |        | (a)                                                                                                                                       | A Security
 Party is unable or admits inability to pay its debts as they fall due,
 suspends making payments on any of its debts or, by reason of actual or
 anticipated financial difficulties, commences negotiations with one or more
 of its creditors with a view to rescheduling any of its Financial
 Indebtedness.
| |  |        |                                                                                                                                           |                                                                                                                                                                                                                                                                                                                           
| |  |        | (b)                                                                                                                                       | The value of
 the assets of a Security Party is less than its liabilities (taking into account contingent and
 prospective liabilities).                                                                                                                                                                                  
| |  |        |                                                                                                                                           |                                                                                                                                                                                                                                                                                                                           
| |  |        | (c)                                                                                                                                       | A moratorium
 is declared in respect of any Financial Indebtedness of a Security Party.                                                                                                                                                                                                                                   
| |  |        |                                                                                                                                          
| |  | 14.1.6 | Insolvency proceedings
 Any corporate action, legal proceedings or other procedure or step is taken
 for:                                
| |  |        |                                                                                                                                           |                                                                                                                                                                                                                                                                                                                           
| |  |        | (a)                                                                                                                                       | the
 suspension of payments, a moratorium of any Financial Indebtedness,
 winding-up, dissolution, administration, bankruptcy or reorganisation (by way
 of voluntary arrangement, scheme of arrangement or otherwise) of a Security
 Party;                                                                              
| |  |        |                                                                                                                                           |                                                                                                                                                                                                                                                                                                                           
| |  |        | (b)                                                                                                                                       | a
 composition, compromise, assignment or arrangement with any creditor of a
 Security Party;                                                                                                                                                                                                                             
| |  |        |                                                                                                                                           |                                                                                                                                                                                                                                                                                                                           
| |  |        | (c)                                                                                                                                       | the
 appointment of a liquidator, receiver, administrative receiver,
 administrator, compulsory manager, or trustee or other similar officer in
 respect of any Security Party or any of its assets; or                                                                                                                   
| |  |        |                                                                                                                                           |                                                                                                                                                                                                                                                                                                                           
| |  |        | (d)                                                                                                                                       | enforcement
 of any Encumbrance over any assets of a Security Party,                                                                                                                                                                                                                                                      
| |  |        |                                                                                                                                          
| |  |        | or any
 analogous procedure or step is taken in any jurisdiction.                                                                        
| |  |        |                                                                                                                                          
| |  | 14.1.7 | Creditors process
 Any expropriation, attachment, sequestration, distress or execution affects
 any asset or assets of a Security Party.
| |  |        |                                                                                                                                          
| |  | 14.1.8 | Change in ownership or control of the Borrower
 or the Managers The Borrower ceases to be a wholly
 owned Subsidiary of the Corporate    

45

---



| |  |         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| |  | ------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  |         | Guarantor or
 there is any change in the beneficial ownership or control of the Borrower or
 the Managers from that advised to the Lender by the Borrower on the Signing
 Date.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| |  |         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| |  | 14.1.9  | Repudiation A
 Security Party or any other person (except the Lender) repudiates any of the
 Relevant Documents to which that Security Party or person is a party or
 evidences an intention to do so.                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| |  |         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| |  | 14.1.10 | Impossibility or illegality
 Any event occurs which would, or would with the passage of time, render
 performance of any of the Relevant Documents by a Security Party or any other
 party to any such document impossible, unlawful or unenforceable by the
 Lender or a Security Party.                                                                                                                                                                                                                                                                                                                                                                               
| |  |         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| |  | 14.1.11 | Conditions subsequent
 Any of the conditions referred to in Clause 3.5 is not satisfied within the
 time reasonably required by the Lender.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| |  |         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| |  | 14.1.12 | Revocation or modification of authorisation
 Any consent, licence, approval, authorisation, filing, registration or other
 requirement of any governmental, judicial or other public body or authority
 which is now, or which at any time during the Facility Period becomes,
 necessary to enable a Security Party or any other person (except the Lender)
 to comply with any of its obligations under any of the Relevant Documents is
 not obtained, is revoked, suspended, withdrawn or withheld, or is modified in
 a manner which the Lender considers is, or may be, prejudicial to the
 interests of the Lender, or ceases to remain in full force and effect.
| |  |         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| |  | 14.1.13 | Curtailment of business
 A Security Party ceases, or threatens to cease, to carry on all or a
 substantial part of its business or, as a result of intervention by or under
 the authority of any government, the business of a Security Party is wholly
 or partially curtailed or suspended, or all or a substantial part of the
 assets or undertaking of a Security Party is seized, nationalised,
 expropriated or compulsorily acquired.                                                                                                                                                                                                                          
| |  |         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| |  | 14.1.14 | Reduction of capital
 A Security Party (other than the Corporate Guarantor) reduces its authorised
 or issued or subscribed capital.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    

46

---



| |  |         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                                                       
| |  | ------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | 14.1.15 | Loss of Vessel The
 Vessel suffers a Total Loss or is otherwise destroyed, abandoned,
 confiscated, forfeited or condemned as prize, or a similar event occurs in
 relation to any other vessel which may from time to time be mortgaged to the
 Lender as security for the payment of all or any part of the Indebtedness,
 except that a Total Loss, or event similar to a Total Loss in relation to any
 other vessel, shall not be an Event of Default if:
| |  |         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                                                       
| |  |         | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                            | the Vessel
 or other vessel is insured in accordance with the Security Documents; and                                                                                                                                                                                                 
| |  |         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                                                       
| |  |         | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                            | no insurer
 has refused to meet or has disputed the claim for Total Loss and it is not
 apparent to the Lender in its discretion that any such refusal or dispute is
 likely to occur; and                                                                                            
| |  |         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                                                       
| |  |         | (c)                                                                                                                                                                                                                                                                                                                                                                                                                                                            | payment of
 all insurance proceeds in respect of the Total Loss is made in full to the
 Lender within one hundred and eighty (180) days of the occurrence of the
 casualty giving rise to the Total Loss in question or such longer period as
 the Lender may in its discretion agree.
| |  |         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                                                       
| |  | 14.1.16 | Challenge to registration
 The registration of the Vessel or the Mortgage is contested or becomes void
 or voidable or liable to cancellation or termination, or the validity or
 priority of the Mortgage is contested.                                                                                                                                                                                                                                      
| |  |         |                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| |  | 14.1.17 | War The country of
 registration of the Vessel becomes involved in war (whether or not declared)
 or civil war or is occupied by any other power and the Lender in its
 discretion considers that, as a result, the security conferred by the
 Security Documents is materially prejudiced.                                                                                                                                                                   
| |  |         |                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| |  | 14.1.18 | Master Agreement termination
 A notice is given by the Lender under section 6(a) of the Master Agreement,
 or by any person under section 6(b)(iv) of the Master Agreement, in either
 case designating an Early Termination Date for the purpose of the Master
 Agreement, or the Master Agreement is for any other reason terminated,
 cancelled,                                                                                                           

47

---



|   |                                  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                                                                          
|-- | -------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | suspended,
 rescinded, revoked or otherwise ceases to remain in full force and effect.                                                                                                                                                   
|   |                                  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                                                                          
|   |                                  | 14.1.19                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | Material adverse change
 Any event or series of events occurs which, in the opinion of the Lender, is
 likely to have a materially adverse effect on the business, assets, financial
 condition or credit worthiness of a Security Party.
|   |                                  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                                                                          
|   |                                  | 14.1.20                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | Notice of termination
 Any of the Guarantors gives notice to the Lender to determine its obligations
 under the relevant Guarantee.                                                                                                      
|   |                                  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                                                                          
|   | 14.2                             | Acceleration If an
 Event of Default is continuing the Lender may by notice to the Borrower
 cancel any part of the Maximum Amount not then advanced and:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|   |                                  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                                                                          
|   |                                  | 14.2.1                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | declare that
 the Loan, together with accrued interest, and all other amounts accrued or
 outstanding under the Finance Documents are immediately due and payable,
 whereupon they shall become immediately due and payable; and/or      
|   |                                  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                                                                          
|   |                                  | 14.2.2                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | declare that
 the Loan is payable on demand, whereupon it shall immediately become payable
 on demand by the Lender.                                                                                                                     
|   |                                  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                                                                          
|15 | Assignment and Sub-Participation
|   |                                  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                                                                          
|   | 15.1                             | Right to assign
 The Lender may, subject to the prior approval of the Borrower (such approval
 not to be unreasonably withheld) and subject to the Lender giving prior
 notice of such intention to the Borrower, and without additional costs to the
 Borrower, assign or transfer all or any of its rights under or pursuant to
 the Security Documents to any other bank or financial institution, and may
 grant sub-participations in all or any part of the Loan. The Lender may,
 without the prior approval of the Borrower, assign or transfer all or any of
 its rights under or pursuant to the Security Documents to any other branch of
 the Lender, and may grant sub-participations in all or any part of the Loan.
|   |                                  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                                                                          
|   | 15.2                             | Borrowers co-operation
 The Borrower will co-operate fully with the Lender in connection with any
 assignment, transfer or sub-participation; will execute and procure the
 execution of such documents as the Lender may require in that connection; and
 irrevocably authorises the Lender to disclose to any proposed                                                                                                                                                                                                                                                                                                                                                                                                         

48

---



|   |          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | 
|-- | -------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | 
|   |          | assignee,
 transferee or sub-participant (whether before or after any assignment,
 transfer or sub-participation and whether or not any assignment, transfer or
 sub-participation shall take place) all information relating to the Security
 Parties, the Loan, the Relevant Documents and the Vessel which the Lender may
 in its discretion consider necessary or desirable.                                                                                                                                                                                                                                                                                                                                                          
|   |          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | 
|   | 15.3     | Rights of assignee or transferee
 Any assignee or transferee of the Lender shall (unless limited by the express
 terms of the assignment or novation) take the full benefit of every provision
 of the Finance Documents benefitting the Lender.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|   |          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | 
|   | 15.4     | No assignment or transfer by the Borrower
 The Borrower may not assign any of its rights or transfer any of its rights
 or obligations under the Finance Documents.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|   |          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | 
|16 | Set-Off 
|   |          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | 
|   | 16.1     | The Lender
 may set off any matured obligation due from the Borrower under any Finance
 Document against any matured obligation owed by the Lender to the Borrower,
 regardless of the place of payment, booking branch or currency of either
 obligation. If the obligations are in different currencies, the Lender may
 Convert either obligation at a market rate of exchange in its usual course of
 business for the purpose of the set-off.                                                                                                                                                                                                                                                                                        
|   |          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | 
|   | 16.2     | Master Agreement rights
 The rights conferred on the Lender by this Clause 16 shall be in addition to,
 and without prejudice to or limitation of, the rights of netting and set off
 conferred on the Lender by the Master Agreement.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   |          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | 
|17 | Payments
|   |          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | 
|   | 17.1     | Payments Each
 amount payable by the Borrower under a Finance Document shall be paid to such
 account at such bank as the Lender may from time to time direct to the
 Borrower in the Currency of Account and in such funds as are customary at the
 time for settlement of transactions in the relevant currency in the place of
 payment. Payment shall be deemed to have been received by the Lender on the
 date on which the Lender receives authenticated advice of receipt, unless
 that advice is received by the Lender on a day other than a Business Day or
 at a time of day (whether on a Business Day or not) when the Lender in its
 discretion considers that it is impossible or impracticable for the Lender to
 utilise

49

---



| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | 
| | ---- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | 
| |      | the amount
 received for value that same day, in which event the payment in question
 shall be deemed to have been received by the Lender on the Business Day next
 following the date of receipt of advice by the Lender.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | 
| | 17.2 | No deductions or withholdings
 Each payment (whether of principal or interest or otherwise) to be made by
 the Borrower under a Finance Document shall, subject only to Clause 17.3, be
 made free and clear of and without deduction for or on account of any Taxes
 or other deductions, withholdings, restrictions, conditions or counterclaims
 of any nature.                                                                                                                                                                                                                                                                                                                                                    
| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | 
| | 17.3 | Grossing-up If at
 any time any law requires the Borrower to make any deduction or withholding
 from any payment, or to change the rate or manner in which any required
 deduction or withholding is made, the Borrower will promptly notify the
 Lender and, simultaneously with making that payment, will pay to the Lender
 whatever additional amount (after taking into account any additional Taxes
 on, or deductions or withholdings from, or restrictions or conditions on,
 that additional amount) is necessary to ensure that, after making the
 deduction or withholding, the Lender receives a net sum equal to the sum
 which the Lender would have received had no deduction or withholding been
 made.
| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | 
| | 17.4 | Evidence of deductions
 If at any time the Borrower is required by law to make any deduction or
 withholding from any payment to be made by it under a Finance Document, the
 Borrower will pay the amount required to be deducted or withheld to the
 relevant authority within the time allowed under the applicable law and will,
 no later than thirty (30) days after making that payment, deliver to the
 Lender an original receipt issued by the relevant authority, or other
 evidence acceptable to the Lender, evidencing the payment to that authority
 of all amounts required to be deducted or withheld.                                                                                                
| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | 
| | 17.5 | Adjustment of due dates
 If any payment or transfer of funds to be made under a Finance Document,
 other than a payment of interest on a Drawing, or a payment under the Master
 Agreement, shall be due on a day which is not a Business Day, that payment
 shall be made on the next succeeding Business Day (unless the next succeeding
 Business Day falls in the next calendar month in which event the payment
 shall be made on the next preceding Business Day).                                                                                                                                                                                                                                               

50

---



|   |         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                         
|-- | ------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |         | Any such
 variation of time shall be taken into account in computing any interest in
 respect of that payment.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   |         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                         
|   | 17.6    | Control Account
 The Lender shall open and maintain on its books a control account in the name
 of the Borrower showing the advance of the Loan and the computation and
 payment of interest and all other sums due under this Agreement and the
 Master Agreement. The Borrowers obligations to repay the Loan and to pay
 interest and all other sums due under this Agreement and the Master Agreement
 shall be evidenced by the entries from time to time made in the control
 account opened and maintained under this Clause 17.6 and those entries will,
 in the absence of manifest error, be conclusive and binding.
|   |         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                         
|18 | Notices
|   |         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                         
|   | 18.1    | Communications in writing
 Any communication to be made under or in connection with this Agreement shall
 be made in writing and, unless otherwise stated, may be made by fax or
 letter.                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   |         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                         
|   | 18.2    | Addresses The
 address and fax number (and the department or officer, if any, for whose
 attention the communication is to be made) of each party to this Agreement
 for any communication or document to be made or delivered under or in
 connection with this Agreement are:                                                                                                                                                                                                                                                                                                                                                
|   |         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                         
|   |         | 18.2.1                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | in the case
 of the Borrower, c/o Safety Management Overseas S.A., 32 Avenue Karamanli,
 GR-166 05 Voula, Athens, Greece (telex no: 215050 answerback: SAFE GR, fax
 no: +30 210 895 6900) marked for the attention of Mr Konstantinos
 Adamopoulos; and
|   |         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                         
|   |         | 18.2.2                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | in the case
 of the Lender, to the Lender at its address at the head of this Agreement
 (fax no: +44 207 626 5956 tel no: +44 207 621 6045) marked for the attention
 of: Shipping Department;                                                          
|   |         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                         
|   |         | or any
 substitute address, fax number, department or officer as either party may
 notify to the other by not less than five (5) Business Days notice.                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|   |         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                         
|   | 18.3    | Delivery Any
 communication or document made or delivered by one party to this Agreement to
 the other under or in connection this Agreement will only be effective:                                                                                                                                                                                                                                                                                                                                                                                                                                                           

51

---



|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                                      |                                                                                                                                                                                                                                              
|-- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                  | 18.3.1                                                                                                                                                                               | if by way of
 fax, when received in legible form; or                                                                                                                                                                                         
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                                      |                                                                                                                                                                                                                                              
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                  | 18.3.2                                                                                                                                                                               | if by way of
 letter, when it has been left at the relevant address or five (5) Business
 Days after being deposited in the post postage prepaid in an envelope
 addressed to it at that address;                                            
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                                      |                                                                                                                                                                                                                                              
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                  | and, if a
 particular department or officer is specified as part of its address details
 provided under Clause 18.2, if addressed to that department or officer.                    
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                                      |                                                                                                                                                                                                                                              
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                  | Any
 communication or document to be made or delivered to the Lender will be
 effective only when actually received by the Lender.                                                  
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                                      |                                                                                                                                                                                                                                              
|   | 18.4                                                                                                                                                                                                                                                                                                                                                                                                                                             | English language
 Any notice given under or in connection with this Agreement must be in
 English. All other documents provided under or in connection with this
 Agreement must be:
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                                      |                                                                                                                                                                                                                                              
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                  | 18.4.1                                                                                                                                                                               | in English;
 or                                                                                                                                                                                                                              
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                                      |                                                                                                                                                                                                                                              
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                  | 18.4.2                                                                                                                                                                               | if not in
 English, and if so required by the Lender, accompanied by a certified English
 translation and, in this case, the English translation will prevail unless
 the document is a constitutional, statutory or other official document.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                                      |                                                                                                                                                                                                                                              
|19 | Partial Invalidity                                                                                                                                                                                                                                                                                                                                                                                                                              
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                                      |                                                                                                                                                                                                                                              
|   | If, at any
 time, any provision of a Finance Document is or becomes illegal, invalid or
 unenforceable in any respect under any law of any jurisdiction, neither the legality,
 validity or enforceability of the remaining provisions nor the legality,
 validity or enforceability of such provision under the law of any other
 jurisdiction will in any way be affected or impaired.                                                        
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                                      |                                                                                                                                                                                                                                              
|20 | Remedies and Waivers                                                                                                                                                                                                                                                                                                                                                                                                                            
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                                      |                                                                                                                                                                                                                                              
|   | No failure to
 exercise, nor any delay in exercising, on the part of the Lender, any right
 or remedy under a Finance Document shall operate as a waiver, nor shall any
 single or partial exercise of any right or remedy prevent any further or
 other exercise or the exercise of any other right or remedy. The rights and
 remedies provided in this Agreement are cumulative and not exclusive of any
 rights or remedies provided by law.

52

---



|   |               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | 
|-- | ------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | 
|21 | Miscellaneous
|   |               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | 
|   | 21.1          | No oral variations
 No variation or amendment of a Finance Document shall be valid unless in
 writing and signed on behalf of the Lender.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   |               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | 
|   | 21.2          | Further Assurance
 If any provision of a Finance Document shall be invalid or unenforceable in
 whole or in part by reason of any present or future law or any decision of
 any court, or if the documents at any time held by or on behalf of the Lender
 are considered by the Lender for any reason insufficient to carry out the
 terms of this Agreement, then from time to time the Borrower will promptly,
 on demand by the Lender, execute or procure the execution of such further
 documents as in the opinion of the Lender are necessary to provide adequate
 security for the repayment of the Indebtedness.
|   |               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | 
|   | 21.3          | Rescission of payments etc.
 Any discharge, release or reassignment by the Lender of any of the security
 constituted by, or any of the obligations of a Security Party contained in, a
 Finance Document shall be (and be deemed always to have been) void if any act
 (including, without limitation, any payment) as a result of which such
 discharge, release or reassignment was given or made is subsequently wholly
 or partially rescinded or avoided by operation of any law.                                                                                                                                   
|   |               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | 
|   | 21.4          | Certificates Any
 certificate or statement signed by an authorised signatory of the Lender
 purporting to show the amount of the Indebtedness (or any part of the
 Indebtedness) or any other amount referred to in any Finance Document shall,
 save for manifest error or on any question of law, be conclusive evidence as
 against the Borrower of that amount.                                                                                                                                                                                                                                                       
|   |               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | 
|   | 21.5          | Counterparts This
 Agreement may be executed in any number of counterparts each of which shall
 be original but which shall together constitute the same instrument.                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   |               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | 
|   | 21.6          | Contracts (Rights of Third Parties) Act
 1999 A person who is not a party to this Agreement
 has no right under the Contracts (Rights of Third Parties) Act 1999 to
 enforce or to enjoy the benefit of any term of this Agreement.                                                                                                                                                                                                                                                                                                                                                                                       

53

---



|   |                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                      
|-- | -------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|22 | Law and Jurisdiction
|   |                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                      
|   | 22.1                 | Governing law This
 Agreement shall in all respects be governed by and interpreted in accordance
 with English law.                                                                                                                                                                                                                                                                                                                                                                                  
|   |                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                      
|   | 22.2                 | Jurisdiction For
 the exclusive benefit of the Lender, the parties to this Agreement
 irrevocably agree that the courts of England are to have jurisdiction to
 settle any disputes which may arise out of or in connection with this
 Agreement and that any proceedings may be brought in those courts.                                                                                                                                                                                            
|   |                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                      
|   | 22.3                 | Alternative jurisdictions
 Nothing contained in this Clause 22 shall limit the right of the Lender to
 commence any proceedings against the Borrower in any other court of competent
 jurisdiction nor shall the commencement of any proceedings against the
 Borrower in one or more jurisdictions preclude the commencement of any
 proceedings in any other jurisdiction, whether concurrently or not.                                                                                            
|   |                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                      
|   | 22.4                 | Waiver of objections
 The Borrower irrevocably waives any objection which it may now or in the
 future have to the laying of the venue of any proceedings in any court
 referred to in this Clause 22, and any claim that those proceedings have been
 brought in an inconvenient or inappropriate forum, and irrevocably agrees
 that a judgment in any proceedings commenced in any such court shall be
 conclusive and binding on it and may be enforced in the courts of any other
 jurisdiction.
|   |                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                      
|   | 22.5                 | Service of process
 Without prejudice to any other mode of service allowed under any relevant
 law, the Borrower:                                                                                                                                                                                                                                                                                                                                                                                    
|   |                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                      
|   |                      | 22.5.1                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                | irrevocably
 appoints Mr. Savvas Savvides, 24 Exeter Road, London N14 5JY, England
 (tel/fax: +44 208 361 2606) as its agent for service of process in relation
 to any proceedings before the English courts in connection with this
 Agreement; and
|   |                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                      
|   |                      | 22.5.2                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                | agrees that
 failure by a process agent to notify the Borrower of the process will not
 invalidate the proceedings concerned.                                                                                                                        

54

---



SCHEDULE 1: Conditions Precedent and
Subsequent

Part I: Conditions precedent

|  |                  |                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                     
|- | ---------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|1 | Security Parties
|  |                  |                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                     
|  | (a)              | Constitutional Documents
 Copies of the constitutional documents of each Security Party together with
 such other evidence as the Lender may reasonably require that each Security
 Party is duly incorporated in its country of incorporation and remains in
 existence with power to enter into, and perform its obligations under, the
 Relevant Documents to which it is or is to become a party.
|  |                  |                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                     
|  | (b)              | Certificates of good standing
 A certificate of good standing in respect of each Security Party (if such a
 certificate can be obtained).                                                                                                                                                                                                                                                            
|  |                  |                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                     
|  | (c)              | Board resolutions
 A copy of a resolution of the board of directors of each Security Party:                                                                                                                                                                                                                                                                                                          
|  |                  |                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                     
|  |                  | (i)                                                                                                                                                                                                                                                                                                                                                                                                   | approving
 the terms of, and the transactions contemplated by, the Relevant Documents to
 which it is a party and resolving that it execute those Relevant Documents;
 and          
|  |                  |                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                     
|  |                  | (ii)                                                                                                                                                                                                                                                                                                                                                                                                  | authorising
 a specified person or persons to execute those Relevant Documents (and all
 documents and notices to be signed and/or despatched under those documents)
 on its behalf.
|  |                  |                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                     
|  | (d)              | Officers certificates
 A certificate of a duly authorised officer of each Security Party certifying
 that each copy document relating to it specified in this Part I of Schedule 1
 is correct, complete and in full force and effect as at a date no earlier
 than the Signing Date and setting out the names of the directors and officers
 of that Security Party.                               
|  |                  |                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                     
|  | (e)              | Powers of attorney
 The notarially attested and legalised power of attorney of each Security
 Party under which any documents are to be executed or transactions undertaken
 by that Security Party.                                                                                                                                                                                                 

55

---



|  |                                |                                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                         
|- | ------------------------------ | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------------------------------------
|2 | Security and related documents
|  |                                |                                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                         
|  | (a)                            | Vessel documents
 Photocopies, certified as true by a director or the secretary or the duly
 authorised attorney of the Borrower, of:                                                                                                                                                                                                             
|  |                                |                                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                         
|  |                                | (i)                                                                                                                                                                                                                                                                                                                                                | the
 Management Agreement;                                                                                                                              
|  |                                |                                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                         
|  |                                | (ii)                                                                                                                                                                                                                                                                                                                                               | the Vessels
 current Safety Construction, Safety Equipment, Safety Radio, Oil Pollution
 Prevention and Load Line Certificates;                        
|  |                                |                                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                         
|  |                                | (iii)                                                                                                                                                                                                                                                                                                                                              | the Vessels
 current Certificate of Financial Responsibility issued pursuant to the United
 States Oil Pollution Act 1990 (if required for the Vessel);
|  |                                |                                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                         
|  |                                | (iv)                                                                                                                                                                                                                                                                                                                                               | the Vessels
 current SMC;                                                                                                                              
|  |                                |                                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                         
|  |                                | (v)                                                                                                                                                                                                                                                                                                                                                | the ISM
 Companys current DOC;                                                                                                                         
|  |                                |                                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                         
|  |                                | (vi)                                                                                                                                                                                                                                                                                                                                               | the Vessels
 current ISSC;                                                                                                                             
|  |                                |                                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                         
|  |                                | (vii)                                                                                                                                                                                                                                                                                                                                              | the Vessels
 current IAPPC;                                                                                                                            
|  |                                |                                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                         
|  |                                | (viii)                                                                                                                                                                                                                                                                                                                                             | the Vessels
 current Tonnage Certificate; and                                                                                                          
|  |                                |                                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                         
|  |                                | (ix)                                                                                                                                                                                                                                                                                                                                               | the Existing
 Charter,                                                                                                                                  
|  |                                |                                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                         
|  |                                | in each case
 together with all addenda, amendments or supplements.                                                                                                                                                                                                                                                                               
|  |                                |                                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                         
|  | (b)                            | Evidence of Borrowers title
 Evidence that on the Drawdown Date (i) the Vessel will be at least
 provisionally registered under the flag stated in Recital (A) in the
 ownership of the Borrower and (ii) the Mortgage will be capable of being
 registered against the Vessel with first priority.                                              
|  |                                |                                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                         
|  | (c)                            | Evidence of insurance
 Evidence that the Vessel is insured in the manner required by the Security
 Documents and that letters of undertaking will be issued in the manner
 required by the Security Documents, together with (if required by the Lender)
 the written approval of the Insurances by an insurance adviser appointed by
 the Lender.

56

---



|  |                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | 
|- | -------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | 
|  | (d)            | Confirmation of class
 A Certificate of Confirmation of Class for hull and machinery confirming that
 the Vessel is classed +100A1+LMC with Lloyds Register of Shipping or such
 other classification society as may be acceptable to the Lender in its
 absolute discretion free of recommendations affecting class.                                                                                                                                                                                                                                                                                                                   
|  |                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | 
|  | (e)            | Security Documents
 The Security Documents, together with all other documents required by any of
 them, including, without limitation, all notices of assignment and/or charge
 and evidence that those notices will be duly acknowledged by the recipients.                                                                                                                                                                                                                                                                                                                                                                             
|  |                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | 
|  | (f)            | Side Letter The
 side letter evidencing the Current Shareholders of the Corporate Guarantor
 issued by the Corporate Guarantor in favour of the Lender in such form as the
 Lender may require.                                                                                                                                                                                                                                                                                                                                                                                                                                          
|  |                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | 
|  | (g)            | Mandates Such duly
 signed forms of mandate, and/or other evidence of the opening of the
 Accounts, as the Lender may require.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|  |                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | 
|  | (h)            | Managers confirmation
 The written confirmation of the Managers that, throughout the Facility Period
 unless otherwise agreed by the Lender, they will remain the commercial and
 technical managers of the Vessel and that they will not, without the prior
 written consent of the Lender, sub-contract or delegate the commercial or
 technical management of the Vessel to any third party and confirming in terms
 acceptable to the Lender that, following the occurrence of an Event of
 Default, all claims of the Managers against the Borrower shall be
 subordinated to the claims of the Lender under the Finance Documents.
|  |                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | 
|  | (i)            | No disputes The
 written confirmation of the Borrower that there is no dispute under any of
 the Relevant Documents as between the parties to any such document.                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|  |                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | 
|3 | Legal opinions
|  |                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | 
|  | (a)            | If a
 Security Party is incorporated in a jurisdiction other than England and Wales
 or if any Finance Document is governed by the laws of a jurisdiction other
 than England and Wales, a legal opinion of the legal advisers to the Lender
 in each relevant jurisdiction, substantially in the form or forms provided to
 the Lender                                                                                                                                                                                                                                                                                                  

57

---



|  |                              |                                                                                                                                                                                                                                                                                                                                                                                                                                     | 
|- | ---------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | 
|  |                              | prior to the
 Signing Date or confirmation satisfactory to the Lender that such an opinion
 will be given.                                                                                                                                                                                                                                                                                                                         
|  |                              |                                                                                                                                                                                                                                                                                                                                                                                                                                     | 
|4 | Other documents and evidence
|  |                              |                                                                                                                                                                                                                                                                                                                                                                                                                                     | 
|  | (a)                          | Drawdown Notice A
 duly completed Drawdown Notice.                                                                                                                                                                                                                                                                                                                                                                                 
|  |                              |                                                                                                                                                                                                                                                                                                                                                                                                                                     | 
|  | (b)                          | Process agent
 Evidence that any process agent referred to in Clause 22.5 and any process
 agent appointed under any other Finance Document has accepted its appointment.                                                                                                                                                                                                                                                          
|  |                              |                                                                                                                                                                                                                                                                                                                                                                                                                                     | 
|  | (c)                          | Other authorisations
 A copy of any other consent, licence, approval, authorisation or other
 document, opinion or assurance which the Lender considers to be necessary or
 desirable (if it has notified the Borrower accordingly) in connection with
 the entry into and performance of the transactions contemplated by any of the
 Relevant Documents or for the validity and enforceability of any of the
 Relevant Documents.
|  |                              |                                                                                                                                                                                                                                                                                                                                                                                                                                     | 
|  | (d)                          | Fees Evidence that
 the fees, costs and expenses then due from the Borrower under Clause 9 and
 Clause 10 have been paid or will be paid by the Drawdown Date.                                                                                                                                                                                                                                                                     
|  |                              |                                                                                                                                                                                                                                                                                                                                                                                                                                     | 
|  | (e)                          | Know your
 customer documents Such documentation and other
 evidence as is reasonably requested by the Lender in order for the Lender to
 comply with all necessary know your customer or similar identification
 procedures in relation to the transactions contemplated in the Finance
 Documents.                                                                                                                           

58

---



Part II: Conditions subsequent

|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                         |  | 
|- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | 
|1 | Evidence of Borrowers title
 Certificate of ownership and encumbrance (or equivalent) issued by the
 Registrar of Ships (or equivalent official) of the flag stated in Recital (A)
 confirming that (a) the Vessel is permanently registered under that flag in
 the ownership of the Borrower, (b) the Mortgage has been registered with first
 priority against the Vessel and (c) there are no further Encumbrances
 registered against the Vessel.
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                         |  | 
|2 | Letters of undertaking
 Letters of undertaking in respect of the Insurances as required by the
 Security Documents together with copies of the relevant policies or cover
 notes or entry certificates duly endorsed with the interest of the Lender.                                                                                                                                                                                                  
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                         |  | 
|3 | Acknowledgements of notices
 Acknowledgements of all notices of assignment and/or charge given pursuant to
 the Security Documents.                                                                                                                                                                                                                                                                                                                    
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                         |  | 
|4 | Legal opinions
 Such of the legal opinions specified in Part I of this Schedule 1 as have not
 already been provided to the Lender.                                                                                                                                                                                                                                                                                                                    
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                         |  | 
|5 | Companies Act registrations
 Evidence that the prescribed particulars of the Security Documents have been
 delivered to the Registrar of Companies of Cyprus within the statutory time
 limit.                                                                                                                                                                                                                                                         
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                         |  | 
|6 | Mortgagees Insurance Fees
 Payment to the Lender of all fees in relation to inspections, valuations,
 legal fees and premiums for Mortgagees Insurances.                                                                                                                                                                                                                                                                                             

59

---



SCHEDULE 2: Calculation of Mandatory Cost

|    |                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                         | 
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | 
|1   | The
 Mandatory Cost is an addition to the interest rate to compensate the Lender
 for the cost of compliance with (a) the requirements of the Bank of England
 and/or the Financial Services Authority (or, in either case, any other
 authority which replaces all or any of its functions) or (b) the requirements
 of the European Central Bank.                          
|    |                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                         | 
|(a) | On the first
 day of each Interest Period (or as soon as possible thereafter) the Lender
 shall calculate, as a percentage rate, a rate (the Additional Cost Rate) in
 accordance with the paragraphs set out below.                                                                                                                                                       
|    |                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                         | 
|(b) | The
 Additional Cost Rate for the Lender if lending from an office in the
 euro-zone will be the percentage notified by the Lender to the Borrower to be
 its reasonable determination of the cost (expressed as a percentage of the
 Loan) of complying with the minimum reserve requirements of the European
 Central Bank as a result of making the Loan from that office.
|    |                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                         | 
|(c) | The
 Additional Cost Rate for the Lender if lending from an office in the United
 Kingdom will be calculated by the Lender as follows:                                                                                                                                                                                                                                       
|    |                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                         | 
|    | (d)                                                                                                                                                                                                                                                                                                                                                                           | where the
 Loan is denominated in sterling:                                                                                                                                                                                                                            
|    |                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                         | 
|    |                                                                                                                                                                                                                                                                                                                                                                               | BY + S(Y -
 Z) + F x 0.01 per cent per annum                                                                                                                                                                                                                           
|    |                                                                                                                                                                                                                                                                                                                                                                               | 100
 - (B + S)                                                                                                                                                                                                                                                         
|    |                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                         | 
|    | (e)                                                                                                                                                                                                                                                                                                                                                                           | where the
 Loan is denominated in any currency other than sterling:                                                                                                                                                                                                    
|    |                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                         | 
|    |                                                                                                                                                                                                                                                                                                                                                                               | F x 0.01per
 cent per annum                                                                                                                                                                                                                                            
|    |                                                                                                                                                                                                                                                                                                                                                                               | 300                                                                                                                                                                                                                                                                    
|    |                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                         | 
|    | where:                                                                                                                                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                                                        
|    |                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                         | 
|    | B                                                                                                                                                                                                                                                                                                                                                                             | is the
 percentage of eligible liabilities (assuming these to be in excess of any
 stated minimum) which the Lender is from time to time required to maintain as
 an interest free cash ratio deposit with the Bank of England to comply with
 cash ratio requirements;
|    |                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                         | 
|    | Y                                                                                                                                                                                                                                                                                                                                                                             | is the
 percentage rate of interest (excluding the Margin and the Mandatory Cost and,
 if the Loan is an overdue amount, the additional rate of interest specified
 in Clause 7.8) payable for the relevant Interest Period on the Loan;                               

60

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|  |                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                                                                                                                                                                                                                                                  | 
|- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | 
|  | S                                                                                                                                                                                                                                                                                                                                  | is the
 percentage (if any) of eligible liabilities which the Lender is required from
 time to time to maintain as interest bearing special deposits with the Bank
 of England;                                                                                                                                                                                                                                 
|  |                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                                                                                                                                                                                                                                                  | 
|  | Z                                                                                                                                                                                                                                                                                                                                  | is the
 interest rate per annum payable by the Bank of England to the Lender on
 special deposits; and                                                                                                                                                                                                                                                                                                          
|  |                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                                                                                                                                                                                                                                                  | 
|  | F                                                                                                                                                                                                                                                                                                                                  | is the
 charge payable by the Lender to the Financial Services Authority under
 paragraph 2.02 or 2.03 (as appropriate) of the Fees Regulations or the
 equivalent provisions in any replacement regulations (with, for this purpose,
 the figure for the minimum amount in paragraph 2.02b or such equivalent
 provision deemed to be zero), expressed in pounds per ₤l million of the fee base of
 the Lender.
|  |                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                                                                                                                                                                                                                                                  | 
|  |                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                                                                                                                                                                                                                                                  | 
|2 | For the
 purpose of this Schedule:                                                                                                                                                                                                                                                                                                
|  |                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                                                                                                                                                                                                                                                 
|  | (a)                                                                                                                                                                                                                                                                                                                                | eligible
 liabilities and special deposits have the meanings given
 to them at the time of application of the formula by the Bank of England;                                                                                                                                                                                                                                                               
|  |                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                                                                                                                                                                                                                                                  | 
|  | (b)                                                                                                                                                                                                                                                                                                                                | fee base
 has the meaning given to it in the Fees Regulations;                                                                                                                                                                                                                                                                                                                                                
|  |                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                                                                                                                                                                                                                                                  | 
|  | (c)                                                                                                                                                                                                                                                                                                                                | Fees
 Regulations means the regulations governing periodic fees
 contained in the FSA Supervision Manual or such other law or regulation as
 may be in force from time to time in respect of the payment of fees for the
 acceptance of deposits.                                                                                                                                                             
|  |                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                                                                                                                                                                                                                                                  | 
|3 | In the
 application of the formula B, Y, S and Z are included in the formula as
 figures and not as percentages, e.g. if B = 0.5% and Y = 15%, BY is
 calculated as 0.5. x 15. Each rate calculated in accordance with the formula
 is, if necessary, rounded upward to four decimal places.                                      
|  |                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                                                                                                                                                                                                                                                  | 
|4 | If a change
 in circumstances has rendered, or will render, the formula inappropriate, the
 Lender shall notify the Borrower of the manner in which the Mandatory Cost
 will subsequently be calculated. The manner of calculation so notified by the
 Lender shall, in the absence of manifest error, be binding on the Borrower.

61

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SCHEDULE 3: Form of Drawdown Notice

|      |                               
|----- | ------------------------------
|To:   | DNB NOR BANK ASA              
|      |                               
|From: | Eniadefhi Shipping Corporation

2008

Dear Sirs,

Drawdown Notice

We
refer to the reducing revolving multi-currency credit facility agreement dated
[                    ]
2008 made between ourselves and yourselves (the Agreement).

Words
and phrases defined in the Agreement have the same meaning when used in this
Drawdown Notice.

Pursuant
to Clause 4 of the Agreement, we irrevocably request that you advance a Drawing
in the sum of
[                                                                                ]
to us on
[                    ]
2008, which is a Business Day, by paying the amount of the advance to [           ].

We
warrant that the representations and warranties contained in Clause 12.1 of the
Agreement are true and correct at the date of this Drawdown Notice and will be
true and correct
on                    2008,
that no Default has occurred and is continuing, and that no Default will result
from the advance of the sum requested in this Drawdown Notice.

We
select the period of
[          ] months as the
Interest Period in respect of the said Drawing.

|                              
|------------------------------
|Yours faithfully              
|                              
|                              
|                              
|For
 and on behalf of         
|                              
|ENIADEFHI SHIPPING CORPORATION

62

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SCHEDULE 4

Form of Compliance Certificate

|      |                  
|----- | -----------------
|To:   | DnB NOR BANK ASA 
|      |                  
|From: | Safe Bulkers Inc.

Dated:

Dear Sirs

[                              ]
 US$45,000,000 Reducing revolving multi-currency credit facility agreement
dated [          ] 2008 as
amended, supplemented, novated and/or replaced from time to time (the
Agreement)

We refer to the
Agreement. This is a Compliance Certificate. Terms defined in the Agreement
have the same meaning when used in this Compliance Certificate unless given a
different meaning in this Compliance Certificate.

The covenant
calculations below are made as of, and in respect of the six (6) month period
ending on
[                    ].

We confirm
that:

|                 |  |                                               |  |                        |  |                      
|---------------- |  | --------------------------------------------- |  | ---------------------- |  | ---------------------
|Agreement Clause |  | Covenant
determination/Calculation compliance |  | (min/max amount)      
|                 |  |                                               |  |                        |  |                      
|13.2.21 (a)      |  | Consolidated Group Leverage                   |  |                        |  |                      
|                 |  | Consolidated Total
 Liabilities               |  | USD
 [               ] |  |                      
|                 |  | ÷ Consolidated Total
 Assets                  |  | USD
 [               ] |  |                      
|                 |  | = Consolidated Group
 Leverage                |  | [         %]           |  | [maximum 70%]        
|                 |  |                                               |  |                        |  |                      
|13.2.21 (b)      |  | Debt to EBITDA ratio                          |  |                        |  |                      
|                 |  | Debt                                          |  | USD
 [               ] |  |                      
|                 |  | ÷ EBITDA                                      |  | USD
 [               ] |  |                      
|                 |  | =Debt to EBITDA ratio                         |  | [               ]      |  | [maximum 5.5:1]      
|                 |  |                                               |  |                        |  |                      
|13.2.21 (c)      |  | Net Worth                                     |  |                        |  |                      
|                 |  | Consolidated Total Assets                     |  | USD
 [               ] |  |                      
|                 |  | (minus) Consolidated Total
 Liabilities       |  | USD
 [               ] |  |                      
|                 |  | = Net Worth                                   |  | [         %]           |  | [min. USD175,000,000]

63

---



[We confirm
that no Default is continuing.]*

|        |                   |  |                   | 
|------- | ----------------- |  | ----------------- | 
|Signed: |                   |  |                   | 
|        |                   |  |                   | 
|        | Director          |  | Director          | 
|        | Of                |  | of                | 
|       
|        | Safe Bulkers Inc. |  | Safe Bulkers Inc. | 

|  |                                                                                                                                                     | 
|- | --------------------------------------------------------------------------------------------------------------------------------------------------- | 
| 
|* | If this
 statement cannot be made, the certificate should identify any Default that is
 continuing and the steps, if any, being taken to remedy it.

64

---



IN WITNESS
of which the parties to this Agreement have executed this Agreement the day and
year first before written.

|                                   |   |                              
|---------------------------------- | - | -----------------------------
|SIGNEDby Konstantinos
 Adamopoulos | ) |                              
|duly
 authorised for and on behalf | ) | /s/
 Konstantinos Adamopoulos
|of ENIADEFHI
 SHIPPING CORPORATION | ) |                              
|                                   |   |                              
|SIGNEDby Christodoulos
 Vartzis    | ) |                              
|duly
 authorised for and on behalf | ) | /s/
 Christodoulos Vartzis   
|of DnB NOR
 BANK ASA               | ) |                              

---