EXHIBIT 4.1
Private & Confidential







                               Dated April 3, 2006



                               Facility Agreement
                                      for a
                    US$360,000,000 Revolving Credit Facility

                                       to
                        ARIES MARITIME TRANSPORT LIMITED

                                 provided by the
                        banks and financial institutions
                              listed in Schedule 1

                                    Arrangers
                THE GOVERNOR AND COMPANY OF THE BANK OF SCOTLAND
                     NORDEA BANK FINLAND PLC, LONDON BRANCH

                                  Co-Arrangers
                 THE GOVERNOR AND COMPANY OF THE BANK OF IRELAND
                                 HSH NORDBANK AG
              SUMITOMO MITSUI BANKING CORPORATION, BRUSSELS BRANCH

                                   Swap Banks
                           HBOS TREASURY SERVICES PLC
                THE GOVERNOR AND COMPANY OF THE BANK OF SCOTLAND
                     NORDEA BANK FINLAND PLC, LONDON BRANCH
                 THE GOVERNOR AND COMPANY OF THE BANK OF IRELAND
                                 HSH NORDBANK AG
                           SMBC CAPITAL MARKETS, INC.

                                      Agent
                THE GOVERNOR AND COMPANY OF THE BANK OF SCOTLAND

<PAGE>

Private & Confidential




                               Dated April 3, 2006



                               Facility Agreement
                                      for a
                    US$360,000,000 Revolving Credit Facility

                                       to
                        ARIES MARITIME TRANSPORT LIMITED

                                 provided by the
                        banks and financial institutions
                              listed in Schedule 1

                                    Arrangers
                THE GOVERNOR AND COMPANY OF THE BANK OF SCOTLAND
                     NORDEA BANK FINLAND PLC, LONDON BRANCH

                                  Co-Arrangers
                 THE GOVERNOR AND COMPANY OF THE BANK OF IRELAND
                                 HSH NORDBANK AG
              SUMITOMO MITSUI BANKING CORPORATION, BRUSSELS BRANCH

                                   Swap Banks
                           HBOS TREASURY SERVICES PLC
                THE GOVERNOR AND COMPANY OF THE BANK OF SCOTLAND
                     NORDEA BANK FINLAND PLC, LONDON BRANCH
                 THE GOVERNOR AND COMPANY OF THE BANK OF IRELAND
                                 HSH NORDBANK AG
                           SMBC CAPITAL MARKETS, INC.

                                      Agent
                THE GOVERNOR AND COMPANY OF THE BANK OF SCOTLAND

                                                                     NORTON ROSE


<PAGE>

                                    Contents

Clause                                                                      Page

1   Purpose and definitions..................................................1

2   The Facility.............................................................15

3   Interest and Interest Periods............................................18

4   Repayment, prepayment, reduction and termination.........................20

5   Commitment commission, fees and expenses.................................23

6   Payments and taxes; accounts and calculations............................24

7   Representations and warranties...........................................26

8   Undertakings.............................................................30

9   Conditions...............................................................42

10  Events of Default........................................................43

11  Indemnities..............................................................47

12  Unlawfulness and increased costs.........................................48

13  Security, set-off and pro-rata payments..................................50

14  Accounts.................................................................52

15  Assignment, substitution and lending office..............................55

16  Agent....................................................................57

17  Notices and other matters................................................57

18  Governing law and jurisdiction...........................................59

Schedule 1 Part 1 - The Banks and their Commitments..........................60

Part 2 - The Swap Banks......................................................62

Part 3 - The Co-Arrangers....................................................63

Schedule 2 Part 1 - Initial Ships............................................64
    Part 2 - Additional Ship Selection Criteria..............................67
    Part 3 - Maximum amount of Advance.......................................67
    Part 4 - Details of Initial Owners.......................................68

Schedule 3 Form of Drawdown Notice...........................................70

Schedule 4...................................................................71
    Part 1 - Documents and evidence required as
             conditions precedent to the Commitment..........................71
    Part 2 - Documents and evidence required as
             conditions precedent to the first Advance.......................73
    Part 3 - Documents and evidence required as
             a condition precedent to all Advances being made (clause 9.3)...76
    Part 4 - Additional documents and evidence required
             as a condition precedent to any Contract
             Instalment Advance (referred to in clause 9.1)..................80

Schedule 5 Form of Substitution Certificate..................................81

Schedule 6 Compliance Certificate............................................85

Schedule 7 Calculation of Additional Cost....................................87


<PAGE>


THIS AGREEMENT is dated April 3, 2006 and made BETWEEN:

(1)     ARIES MARITIME TRANSPORT LIMITED as borrower (the "Borrower");

(2)     the banks and financial  institutions  whose names and addresses are set
        out in Schedule 1, Part 1 (the "Banks");

(3)     THE GOVERNOR AND COMPANY OF THE BANK OF SCOTLAND and NORDEA BANK FINLAND
        PLC,  LONDON  BRANCH in their  capacity  as joint  lead  arrangers  (the
        "Arrangers");

(4)     the banks and financial  institutions  whose names and addresses are set
        out in Schedule 1, Part 3 (the "Co-Arrangers");

(5)     the banks and  financial  institution  whose names and addresses are set
        out in Schedule 1, Part 2 (the "Swap Banks"); and

(6)     THE  GOVERNOR  AND COMPANY OF THE BANK OF  SCOTLAND  in its  capacity as
        Agent, security agent and trustee (the "Agent").

IT IS AGREED as follows:

1       Purpose and definitions

1.1     Purpose

        This  Agreement  sets out the terms and  conditions  upon and subject to
        which the Banks agree,  according to their several obligations,  to make
        available  to the  Borrower a revolving  credit  facility of up to three
        hundred and sixty million dollars  ($360,000,000) which is to be applied
        by the Borrower:

        (a)     in refinancing the intra-group  loans made to the Initial Owners
                by the  Borrower  using the  Existing  Facilities  (being in the
                maximum  amount of two hundred and thirty  four  million,  three
                hundred and nine  thousand  nine hundred and ninety nine Dollars
                ($234,309,999)) which Existing Facilities are to be prepaid from
                the proceeds of such refinancing;

        (b)     in making available an intra-group  loan to Compassion  Overseas
                Limited pursuant to an Intra-Group Loan Agreement to finance 90%
                of the  purchase  price of Stena  Compassion,  being  the sum of
                fifty   million  four  hundred  and  ninety   thousand   Dollars
                ($50,490,000);

        (c)     in making available to the Additional  Owners  intra-group loans
                under the  Intra-Group  Loan  Agreements to allow the Additional
                Owners to finance:

                (i)     up to 100% of the  purchase  price  or the  construction
                        costs of the Additional Ships; and

                (ii)    the Expected Project Costs; and

        (d)     for general  corporate  purposes up to a maximum  amount of five
                million Dollars ($5,000,000).

1.2     Definitions

        In this Agreement, unless the context otherwise requires:

        "Acceptable  Employment"  means,  in relation to each Ship, a charter or
        other employment  arrangement for a minimum period of twelve (12) months
        with a  reputable  charterer  and at a rate  of  hire,  which  has  been
        approved by the Majority Banks in their sole discretion;

        "Account Bank" means The Governor and Company of the Bank of Scotland of
        New Uberior House, 11 Earl Grey Street,  Edinburgh EH3 9BN, Scotland and
        includes its successors in title;

        "Accounts"  means  the  Retention  Account  and  the  Earnings  Accounts
        together, and "Account" means any or all of them;

        "Accounts  Charges"  means the charges of the Earnings  Accounts and the
        Retention  Account  executed  or (as  the  context  may  require)  to be
        executed by the  Borrower and each Owner (as  appropriate)  in favour of
        the Agent as security agent and trustee on behalf of the Finance Parties
        in respect of each  Earnings  Account and the  Retention  Account in the
        agreed form and "Account Charge" means any of them;

        "Additional   Cost"  means  in  relation  to  any  period  a  percentage
        calculated  for  such  period  at  an  annual  rate  determined  by  the
        application of the formula in Schedule 7;

        "Additional  Owner" means any company  incorporated  in a  jurisdiction,
        capitalised,  structured  and  managed  in a  manner  acceptable  to the
        Arrangers  in  their  sole  discretion  which  becomes  the  owner of an
        Additional Ship;

        "Additional Ship Selection Criteria" means, in relation to an Additional
        Ship, the selection  criteria for such Additional Ship set out in Part 2
        of Schedule 2 or such other  criteria  for an  Additional  Ship which is
        approved by the Majority  Banks at the request of the Borrower from time
        to time;

        "Additional  Ships" means the additional ships which meet the Additional
        Ship Selection  Criteria purchased or (as the context may require) to be
        purchased by an Additional  Owner with the prior written approval of the
        Majority Banks and "Additional Ship" means any of them;

        "Advance"  means each borrowing of a proportion of the Commitment by the
        Borrower  forming part of the Loan or, as the context may  require,  the
        principal  amount of such borrowing for the time being  outstanding  and
        "Advances" means all of them;

        "Agency  Agreement"  means  the  agency  agreement  executed  or (as the
        context may require) to be executed  between the Agent,  the  Arrangers,
        the Co-Arrangers, the Swap Banks and the Banks in the agreed form;

        "Agent"  means The  Governor  and Company of the Bank of Scotland of New
        Uberior House, 11 Earl Grey Street,  Edinburgh EH3 9BN, Scotland or such
        other person as may be appointed  agent,  security agent and trustee for
        the Banks  pursuant to the Agency  Agreement and includes its successors
        and assigns;

        "Approved  Brokers" means  Clarksons,  Braemar  Seascope Group PLC, R.S.
        Platou  Shipbrokers  A.S.,  Arrow Sale & Purchase (UK) Ltd,  Galbraith's
        Limited,  Simpson  Spence & Young  Ltd and  Fearnleys  A/S or any  other
        broker approved by the Banks in their sole discretion;

        "Arrangers"  means The  Governor  and Company of the Bank of Scotland of
        New Uberior House, 11 Earl Grey Street,  Edinburgh EH3 9BN, Scotland and
        Nordea Bank Finland plc,  London Branch of 8th Floor,  City Place House,
        55 Basinghall  Street,  London EC2V 5NB, England as joint lead arrangers
        and "Arranger" means any of them;

        "Assignee" has the meaning ascribed thereto in clause 15.3;

        "Assignment  of  Intra-Group  Loan  Agreements"   means  the  assignment
        executed or (as the context may  require) to be executed by the Borrower
        in favour of the Agent as  security  agent and  trustee on behalf of the
        Finance Parties in the agreed form;

        "Banking  Day" means a day on which  dealings in deposits in Dollars are
        carried on in the London Interbank  Eurocurrency  Market and (other than
        Saturday  or Sunday) on which  banks are open for  general  business  in
        London,  Hamburg  and New York  City  (or any  other  relevant  place of
        payment under clause 6);

        "Banks" mean the banks and financial  institutions  listed in Schedule 1
        and  includes  their  respective  successors  in  title,  Assignees  and
        transferees and "Bank" means any or all of them;

        "Borrowed Money" means  Indebtedness in respect of (i) money borrowed or
        raised and debit  balances at banks,  (ii) any bond,  note,  loan stock,
        debenture or similar debt  instrument,  (iii)  acceptance or documentary
        credit facilities,  (iv) receivables sold or discounted  (otherwise than
        on a non-recourse  basis),  (v) deferred payments for assets or services
        acquired, (vi) finance leases and hire purchase contracts,  (vii) swaps,
        forward exchange  contracts,  futures and other derivatives,  (viii) any
        other transaction (including without limitation forward sale or purchase
        agreements)  having the  commercial  effect of a borrowing or raising of
        money or of any of (ii) to (vii) above and (ix) guarantees in respect of
        Indebtedness of any person falling within any of (i) to (viii) above;

        "Borrower" means Aries Maritime  Transport  Limited of Canon's Court, 22
        Victoria Street,  Hamilton HM EX, Bermuda and includes its successors in
        title;

        "Borrower's Group" means the Borrower and its Related Companies;

        "Borrower's Security Documents" means, at any relevant time, such of the
        Security  Documents as shall have been  executed by the Borrower at such
        time;

        "Builder"   means,  in  relation  to  an  Additional  Ship  which  is  a
        newbuilding,  the  builder  of that  Additional  Ship and  includes  its
        successors in title;

        "Cash" has the meaning given to that term in clause 8.6;

        "Charter" means:

        (a)     in relation to an Initial Ship,  any time charter or consecutive
                voyage  charter for an Initial  Ship as notified to the Agent by
                the Borrower and approved by the Majority Banks in writing;

        (b)     in  relation  to  an  Additional   Ship,  any  time  charter  or
                consecutive  voyage charter for that  Additional Ship for a term
                which exceeds or which by virtue of any optional  extensions may
                exceed twelve (12) months' duration,

        and "Charters" means all of them;

        "Charter  Assignments"  means  the  specific  assignments  of all of the
        Charters  executed (or as the context may require) to be executed by the
        Owners in favour of the Agent as security agent and trustee on behalf of
        the Finance  Parties in the agreed form and "Charter  Assignment"  means
        any of them;

        "Classification" means:

        (a)     in relation to an Initial Ship,  the  classification  set out in
                Part 1 of Schedule 2; and

        (b)     in relation to any Additional  Ship, the highest class available
                to vessels of its type with the relevant Classification Society,

        or, in each case, such other  classification  as the Agent shall, at the
        request of the Borrower,  have agreed in writing shall be treated as the
        Classification in relation to such Ship for the purposes of the Security
        Documents;

        "Classification Society" means:

        (a)     in relation to an Initial Ship, the  classification  society set
                out in Part 1 of Schedule 2; and

        (b)     in relation to any  Additional  Ship, a  classification  society
                which  is  a  member  of  the   International   Association   of
                Classification Societies,

        or, in each case,  such  other  classification  society  which the Agent
        shall,  at the request of the Borrower,  have agreed in writing shall be
        treated as the  Classification  Society in relation to such Ship for the
        purposes of the Security Documents;

        "Co-Arrangers"  means the banks and financial  institutions  whose names
        and addresses are set out in Schedule 1, Part 3 and "Co-Arranger"  means
        any or all of them;

        "Commitment"  means to the extent not terminated or reduced  pursuant to
        clause 4.6 of this Agreement, the sum of three hundred and sixty million
        Dollars ($360,000,000) and in relation to:

        (a)     each Bank the  amount set  opposite  the name of that Bank under
                the heading  "Commitment" in Part 1 of Schedule 1 and the amount
                of any other Commitment  transferred to it under this Agreement;
                and

        (b)     to any other bank, the amount of any  Commitment  transferred to
                it  under  this  Agreement,   under  the  relevant  Substitution
                Certificate,

        as reduced by any relevant term of this Agreement;

        "Compliance  Certificate" means the compliance certificate issued by the
        Borrower under clause 8.7.7;

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

        "Contract" means:

        (a)     in relation to Stena  Compassion and any second-hand  Additional
                Ship, the memorandum of agreement or other contract for the sale
                and  purchase  of  a  ship  (to  be  in  a  form  and  substance
                satisfactory  to the Agent) made or (as the context may require)
                to be made,  between  the  Seller of such Ship and the  relevant
                Owner as buyer of such Ship; and

        (b)     in relation to any  Additional  Ship which is a  newbuilding,  a
                shipbuilding  contract made between the relevant Builder of such
                Additional  Ship  and  the  relevant  Additional  Owner  of that
                Additional  Ship and/or the relevant  Seller of that  Additional
                Ship (to be in a form and substance  satisfactory  to the Agent)
                and as the same may subsequently be supplemented and/or amended,

        and "Contracts" means all of them;

        "Contract   Assignment   Consent   and   Acknowledgements"   means   the
        acknowledgements of notice of, and consent to, the assignment in respect
        of a Contract  relative to an Additional  Ship which is a newbuilding to
        be given by the relevant Builder,  in the form scheduled to the relevant
        Pre-delivery Security Assignment;

        "Contract  Instalment Advance" means, in relation to any Additional Ship
        which is a  newbuilding,  an Advance made, or to be made, to finance the
        payment of an  instalment  of the relevant  Contract  Price  falling due
        before the Delivery Date for that Additional Ship;

        "Contract Price" means;

        (a)     in  relation  to Stena  Compassion,  the  price  payable  by the
                relevant  Owner to the  relevant  Seller  under the Contract for
                Stena Compassion; and

        (b)     in relation to any  Additional  Ship,  the price  payable by the
                relevant   Owner  to  the   relevant   Builder   or  Seller  (as
                appropriate) in accordance with the relevant Contract;

        "Contribution"  means in relation to a Bank, the principal amount of the
        Loan owing to such Bank at any relevant time;

        "Credit  Support  Document" has the meaning given to that  expression in
        Section 14 of the Master Swap  Agreements and as set out in the relevant
        paragraph of Part 4 to the Schedule to each Master Swap Agreement;

        "Credit  Support  Provider" means any person defined as such pursuant to
        Section 14 of the Master Swap Agreements;

        "Deeds of  Covenant"  means,  where  appropriate,  the deeds of covenant
        collateral to the Mortgages  executed or (as the context may require) to
        be executed  by the Owners in favour of the Agent as security  agent and
        trustee on behalf of the Finance Parties in the agreed form and "Deed of
        Covenant" means any of them;

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

        "Delivery"  means the delivery of a Ship to, and the  acceptance  of the
        relevant Ship by, the relevant Owner pursuant to the relevant Contract;

        "Delivery  Date" means,  in relation to each  Additional  Ship and Stena
        Compassion,  the date on which such Ship is  delivered  to the  relevant
        Owner in accordance with the relevant Contract;

        "Delivery Date Advance"  means,  in relation to an Additional Ship which
        is a  newbuilding,  an  Advance  made,  or to be made,  to  finance  the
        instalment  of the Contract  Price  falling due on the Delivery Date for
        that Additional Ship;

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

        "Dollars"  and "$" means the lawful  currency  of the  United  States of
        America  and in  respect  of all  payments  to be made  under any of the
        Security  Documents  mean funds which are for same day settlement in the
        New York Clearing House  Interbank  Payments  System (or such other U.S.
        dollar funds as may at the relevant time be customary for the settlement
        of international banking transactions denominated in U.S. dollars);

        "Drawdown  Date" means any date,  being a Banking Day falling during the
        Drawdown Period, on which an Advance is, or is to be, made;

        "Drawdown Notice" means a notice  substantially in the terms of Schedule
        3;

        "Drawdown  Period" means (subject to the provisions of clause 2.5.4) the
        period from and including  the date of this  Agreement and ending on the
        Repayment  Date or the period  ending on such  earlier  date (if any) on
        which the Commitment is reduced to zero pursuant to clauses 10.2 or 12;

        "Earnings"  means, in relation to each Ship, all moneys  whatsoever from
        time to time due or payable to the  relevant  Owner of such Ship  during
        the  Security  Period  arising out of the use or  operation of such Ship
        including  (but without  limiting the  generality of the  foregoing) all
        freight,  hire  and  passage  moneys,  income  arising  out  of  pooling
        arrangements, compensation payable to the relevant Owner in the event of
        requisition  of such Ship for hire,  remuneration  for salvage or towage
        services,  demurrage  and  detention  moneys and  damages for breach (or
        payments for  variation or  termination)  of any  charterparty  or other
        contract for the employment of such Ship and any sums recoverable  under
        any loss of earnings insurance;

        "Earnings  Accounts"  means  interest  bearing  Dollar  accounts  of the
        Borrower  and the Owners  opened or (as the context  may  require) to be
        opened by the Borrower and the Owners with the Account Bank and includes
        any other  account  designated  in writing by the Account  Bank to be an
        Earnings  Account  for the  purposes  of this  Agreement  and  "Earnings
        Account" means any of them;

        "EBITDA" has the meaning given to that term in clause 8.6;

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

        "Environmental Claim" means:

        (a)     any and all enforcement, clean-up, removal or other governmental
                or  regulatory  action  or  order or  claim  instituted  or made
                pursuant to any Environmental Law or resulting from a Spill; or

        (b)     any claim made by any other person relating to a Spill;

        "Environmental Incident" means any Spill:

        (a)     from any Fleet Vessel; or

        (b)     from any other vessel in circumstances where:

                (i)     any Fleet  Vessel or its owner,  operator or manager may
                        be liable  for  Environmental  Claims  arising  from the
                        Spill (other than Environmental Claims arising and fully
                        satisfied before the date of this Agreement); and/or

                (ii)    any  Fleet   Vessel  may  be  arrested  or  attached  in
                        connection with any such Environmental Claims;

        "Environmental  Laws"  means  all  laws,   regulations  and  conventions
        concerning pollution or protection of human health or the environment;

        "Equity Ratio" has the meaning given to that term in clause 8.6;

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

        "Existing  Facilities"  means the  Advances  (as therein  defined)  made
        available  pursuant to the  facilities  agreement  dated 3 June 2005 (as
        supplemented  and amended from time to time) (the  "Existing  Facilities
        Agreement")  and  made  between  (1) the  Borrower,  (2) the  banks  and
        financial  institutions  as  set  out  in  Schedule  1 to  the  Existing
        Facilities Agreement, (3) Fortis Bank (Nederland) N.V., The Governor and
        Company of the Bank of Scotland  and Nordea  Bank  Finland  plc,  London
        Branch as lead arrangers and (4) Fortis Bank (Nederland) N.V. as agent;

        "Expected Project Costs" means:

        (a)     in connection with the  construction of an Additional  Ship, all
                reasonable  pre-delivery  costs up to the Delivery  Date of such
                Additional Ship which have been approved by the Agent;

        (b)     in connection  with the acquisition of an Additional Ship from a
                Seller,  the deposit  payable in respect of such Additional Ship
                pursuant to the relevant  Contract in an amount  approved by the
                Agent; and

        (c)     all interest paid by the Borrower on the relevant  Advance under
                clause  3 of  this  Agreement  up to the  Delivery  Date of such
                Additional Ship;

        "Facility" means the revolving credit facility made available under this
        Agreement as described in clause 2;

        "Fair Market  Value"  means,  in relation to each Ship,  the fair market
        value of such Ship determined in accordance with clause 8.2.2;

        "Fee Letter" means the letter of even date herewith executed between the
        Borrower, the Agent and the Arrangers;

        "Financial  Covenants" means the Borrower's  financial covenants set out
        in clause 8.6;

        "Finance  Parties" means the Agent, the Arrangers,  the  Co-Arranger(s),
        the Swap Banks and the Banks and "Finance Party" means any of them;

        "Financial  Quarter  Day" has the  meaning  given to that term in clause
        8.6;

        "Flag State" means:

        (a)     in relation to an Initial Ship, the flag state set out in Part 1
                of Schedule 2; and

        (b)     in  relation  to  an  Additional  Ship,  a  state  or  territory
                designated  in  writing  by the  Agent,  at the  request  of the
                Borrower,  as being the "Flag  State" of a Ship for the purposes
                of the Security Documents;

        "Fleet Book Value" has the meaning given to that term in clause 8.6;

        "Fleet Market Value" has the meaning given to that term in clause 8.6;

        "Fleet  Vessel"  means a Ship  and any  other  vessel  owned,  operated,
        managed or crewed by any member of the Borrower's Group;

        "GAAP" means  generally  accepted  accounting  principles  in the United
        States of America;

        "General  Assignments"  means,  where  appropriate,  all of the  general
        assignments  collateral to the Mortgages executed or (as the context may
        require) to be executed by the Owners in favour of the Agent as security
        agent and trustee on behalf of the Finance Parties in substantially  the
        agreed form and "General Assignment" means any of them;

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

        "Indebtedness"  means any  obligation  for the payment or  repayment  of
        money,  whether as principal or as surety and whether present or future,
        actual or contingent;

        "Initial  Owner" means,  in relation to each Initial Ship,  the owner of
        that Initial  Ship set out in Part 1 of Schedule 2 and "Initial  Owners"
        means all of them;

        "Initial  Ships" means the initial ships whose names and particulars are
        set out in Part 1 of Schedule 2 and "Initial Ship" means any of them;

        "Interest Payment Date" means the last day of an Interest Period;

        "Interest  Period" means, in relation to any Advance or the Loan (as the
        case may be), each period for the  calculation of interest in respect of
        such Advance or the Loan  ascertained in accordance with clauses 3.2 and
        3.3;

        "Intra-Group  Loan  Agreements"  means the loan agreements in a form and
        substance  acceptable to the  Arrangers  executed or (as the context may
        require) to be executed by the Borrower  and each Owner  relating to the
        intra-group  loan to be made  available by the Borrower to each Owner to
        enable each such Owner to finance the acquisition  and/or refinancing of
        the relevant Ship and "Intra-Group Loan Agreement" means any of them;

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

        "ISPS Code" means the International Ship and Port Facility Security Code
        constituted  pursuant  to  Resolution  A.  924(22) of the  International
        Maritime  Organisation and  incorporated  into the Safety of Life at Sea
        Convention  and includes any  amendments or  extensions  thereto and any
        regulation issued pursuant thereto;

        "ISSC"  means an  International  Ship  Security  Certificate  issued  in
        respect of a Ship under the provisions of the ISPS Code;

        "LIBOR" means, in relation to a particular  period,  the arithmetic mean
        (rounded  upward if  necessary  to five  decimal  places)  of the London
        interbank  offered rates for Dollar  deposits for a period equal to such
        period  at or about 11 a.m.  (London  time) on the  second  Banking  Day
        before the first day of such period as  displayed  on the "LIBO" page on
        the  Reuter  Monitor  Money  Rates  Service  (or such  other page as may
        replace such "LIBO" page on such  service for the purpose of  displaying
        London interbank  offered rates of major banks for Dollar deposits) (the
        "LIBO"  page),  provided  that if on such date the offered rates of less
        than two banks are so  displayed,  LIBOR  for such  period  shall be the
        arithmetic mean (rounded as aforesaid) of the rates respectively  quoted
        to the Agent by each of the Reference  Banks at the request of the Agent
        as such Reference  Bank's offered rate for Dollar  deposits in an amount
        approximately  equal to the amount in  relation  to which LIBOR is to be
        determined for a period  equivalent to such period to prime banks in the
        London  Interbank Market at or about 11 a.m. (London time) on the second
        Banking Day before the first day of such period;

        "Loan"  means  the  principal  amount  owing  to the  Banks  under  this
        Agreement at any relevant time;

        "Majority Banks" means that Bank or Banks holding at least sixty six and
        two thirds per cent (66 (2)/3%) of the  Commitment  and/or sixty six and
        two thirds per cent (66 (2)/3%) of the Loan;

        "Management Agreements" means the agreements executed or (as the context
        may require) to be executed  between the relevant  Owner and the Manager
        in a form  previously  approved in writing by the Arrangers or any other
        agreement  previously  approved in writing by the Arrangers  between the
        relevant Owner and the Manager providing (inter alia) for the Manager to
        manage the Ships and "Management Agreement" means any of them;

        "Manager" means Magnus Carriers  Corporation,  a company incorporated in
        the Republic of Panama,  with its registered office at Salduba Building,
        East 53rd Street,  Urbanizacion Obarrio, Panama City, Republic of Panama
        and established in Greece under the law 89 regime with a principal place
        of  business  at 18 Zerva  Nap.  Str.,  16675  Glyfada,  Greece,  in its
        capacity  as the  technical  manager  of the Ships or any  other  person
        appointed  by the  Borrower  or other  person,  with the  prior  written
        consent  of the Agent,  as the  manager  of the Ships and  includes  its
        successors in title and assignees;

        "Manager's  Account"  means an interest  bearing  Dollar  account of the
        Manager to be opened by the Manager  with the Account  Bank and includes
        any other  account  designated  in writing by the Account Bank to be the
        Manager's Account for the purposes of this Agreement;

        "Manager's Undertaking" means an undertaking executed or (as the context
        may  require)  to be executed by the Manager in favour of the Agent as a
        condition precedent to the approval of the appointment of the Manager as
        manager of a Ship, such  undertaking to be in  substantially  the agreed
        form or in such other form as the Arrangers may in their sole discretion
        agree and "Manager's Undertakings" means all of them;

        "Margin"  means the margin listed in the following  table which shall be
        adjusted, to the extent that this may be necessary,  on the basis of the
        most recent  Compliance  Certificate with effect from the next following
        date upon which interest is payable pursuant to clause 3.1. In the event
        of the Borrower failing to provide a Compliance  Certificate pursuant to
        clause 8.7.7 the margin shall be 1.5%.

        ========================================================================
        Corporate Leverage                        Margin

        < 50%                                     1.125%
        = 50% but < 60%                           1.250%
        = 60% but < 65%                           1.375%
        = 65%                                     1.500%
        ========================================================================

        Where:

        "Corporate  Leverage"  means,  at any time in respect of the  Borrower's
        Group, the ratio of outstanding Total  Liabilities  divided by the Total
        Assets,  the latter  adjusted  by the Agent for the  difference  between
        Fleet Market Value and Fleet Book Value;

        "Master Swap  Agreements"  means the agreements  dated 30 August 2005 in
        respect of HBOS  Treasury  Services  plc and Nordea  Bank  Finland  plc,
        London  Branch and 2006 in respect of The  Governor  and  Company of the
        Bank of Ireland, HSH Nordbank AG and SMBC Capital Markets,  Inc. each as
        amended and modified and each made between the Borrower and the relevant
        Swap  Bank  and any  Continuations  (as  defined  therein)  supplemented
        thereto and "Master Swap Agreement" means either of them;

        "Master Swap  Assignment"  means the security  assignments of the Master
        Swap Agreements  executed or (as the context may require) to be executed
        by the Borrower in favour of the Agent;

        "month" means a period beginning in one calendar month and ending in the
        next calendar month on the day numerically  corresponding  to the day of
        the calendar month on which it started,  provided that (a) if the period
        started on the last  Banking  Day in a calendar  month or if there is no
        such numerically corresponding day, it shall end on the last Banking Day
        in such next calendar  month and (b) if such  numerically  corresponding
        day is not a Banking  Day,  the period  shall end on the next  following
        Banking Day in the same  calendar  month but if there is no such Banking
        Day it shall end on the preceding Banking Day and "months" and "monthly"
        shall be construed accordingly;

        "Mortgage"  means, in relation to each Ship, a first priority  statutory
        mortgage or first  preferred  mortgage of such Ship  executed or (as the
        context may require) to be executed by the  relevant  Owner in favour of
        the Agent as security agent and trustee on behalf of the Finance Parties
        in the agreed form and "Mortgages" means all of them;

        "Mortgaged  Ship" means, at any relevant time, any Ship which is at such
        time  subject  to  a  Mortgage  and/or  the  Earnings,   Insurances  and
        Requisition  Compensation (as defined in the Ship Security Documents for
        such  Ship) of which  are  subject  to an  Encumbrance  pursuant  to the
        relevant  Ship  Security  Documents and a Ship shall for the purposes of
        this  Agreement  be deemed to be a Mortgaged  Ship as from the date that
        the  Mortgage of that Ship shall have been  executed and  registered  in
        accordance  with this Agreement  until whichever shall be the earlier of
        (a) the  payment in full of the amount  required to be paid to the Banks
        or to the Agent on their  behalf  pursuant to clause 4.5  following  the
        sale or Total Loss of such Ship,  (b) the date on which all moneys owing
        under the Security  Documents  have been repaid in full and (c) the date
        upon which the Agent  deletes or procures  the  deletion of the relevant
        Mortgage in accordance with the terms of this Agreement;

        "NASDAQ" means the stock exchange run by the US National  Association of
        Securities  Dealers with the main exchange  located in the United States
        of  America,  originally  an acronym  for the  National  Association  of
        Securities Dealers Automatic Quotations;

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

        "Owners" means the Initial Owners and the Additional  Owners and "Owner"
        means any of them;

        "Owner's  Guarantee"  means,  in relation to each Owner,  the  guarantee
        issued or (as the  context  may  require)  to be issued by that Owner in
        favour of the Agent in the agreed form as (inter alia)  security for all
        moneys and the discharge of all obligations  and liabilities  due, owing
        or incurred by the  Borrower  under or pursuant to this  Agreement,  the
        Master Swap Agreements and the other Borrower's  Security  Documents and
        "Owner's Guarantees" means all of them;

        "Participating  Member  State"  means any member  state of the  European
        Communities  that adopts or has adopted the euro as its lawful  currency
        in accordance with the legislation of the European Community relating to
        economic and monetary union;

        "Permitted  Encumbrance"  means any  Encumbrance  in favour of the Agent
        and/or  the  Banks  created  pursuant  to  the  Security  Documents  and
        Permitted Liens;

        "Permitted  Liens" means any lien on a Ship for  master's,  officer's or
        crew's wages outstanding in the ordinary course of trading, any lien for
        salvage and any ship repairer's or outfitter's possessory lien for a sum
        not (except with the prior written  consent of the Agent)  exceeding the
        Casualty Amount (as defined in the relevant Deed of Covenant or relevant
        Mortgage);

        "Pollutant"  means  and  includes  oil  and  its  products,   any  other
        polluting,  toxic or hazardous  substance and any other  substance whose
        release into the environment is regulated or penalised by  Environmental
        Laws;

        "Pre-delivery  Security Assignment" means, in relation to any Additional
        Ship which is a newbuilding,  an assignment of the relevant Contract and
        the  relevant  Refund  Guarantee  with respect to that  Additional  Ship
        executed or (as the context may  require) to be executed by the relevant
        Owner of that  Additional  Ship in favour of the Agent as security agent
        and  trustee on behalf of the  Finance  Parties  in the agreed  form and
        "Pre-delivery Security Assignments" means all of them;

        "Protocol  of  Delivery  and  Acceptance"  means,  in  relation to Stena
        Compassion  and any  Additional  Ship,  the  protocol  of  delivery  and
        acceptance  to be signed by or on behalf of the relevant  Seller and the
        relevant  Owner  as buyer  of such  Ship  evidencing  the  delivery  and
        acceptance of such Ship pursuant to the relevant Contract, such protocol
        to be in a form satisfactory to the Agent;

        "Reduction  Dates"  means the date falling six (6) months after the date
        of this  Agreement  and each of the  dates  falling  at six (6)  monthly
        intervals  thereafter  up to the date falling six (6) months  before the
        Repayment Date and "Reduction Date" means each such date;

        "Reference Banks" means the Arrangers;

        "Refund  Guarantee" means, in relation to any Additional Ship which is a
        newbuilding, the guarantee issued or to be issued by the relevant Refund
        Guarantor in respect of the  relevant  Builder's  obligations  under the
        relevant  Contract  and any  further  guarantee(s)  to be issued by such
        Refund  Guarantor  in  respect  of  such  obligations,  pursuant  to any
        agreement  supplemental  to the relevant  Contract,  and any extensions,
        renewals or  replacements  thereto or thereof  and  "Refund  Guarantees"
        means all of them;

        "Refund Guarantee  Assignment  Consent and  Acknowledgements"  means the
        acknowledgements of notice, and consent to, the assignment in respect of
        any Refund Guarantee to be given by the relevant Refund Guarantor in the
        form scheduled to the relevant Pre-delivery Security Assignment;

        "Refund  Guarantor"  means,  in  relation to any Refund  Guarantee,  the
        refund guarantor stipulated under the relevant Contract and includes its
        successors  in title (which shall be acceptable to the Agent in its sole
        discretion);

        "Registry"   means  the  offices  of  the  registrar,   commissioner  or
        representative  of the relevant  Flag State who is duly  authorised  and
        empowered to register the relevant Ship,  the relevant  Owner's title to
        such Ship and the relevant  Mortgage under the laws and flag of the Flag
        State through the relevant Registry;

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

        "Relevant  Jurisdiction"  means any  jurisdiction  in which or where any
        Security Party is  incorporated,  resident,  domiciled,  has a permanent
        establishment,  carries on, or has a place of  business or is  otherwise
        effectively connected;

        "Repayment  Date" means the date which falls sixty (60) months after the
        date of this Agreement;

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

        "Restricted  Companies" means the Borrower and its Related Companies and
        the other Security Parties and their respective Related Companies;

        "Retention  Account"  means an interest  bearing  Dollar  account of the
        Borrower  opened or (as the  context  may  require)  to be opened by the
        Borrower with the Account Bank and includes any other account designated
        in  writing  by the  Account  Bank  to be a  Retention  Account  for the
        purposes of this Agreement;

        "Retention Amount" means, in relation to any Retention Date, such sum as
        shall be the aggregate of:

        (a)     one-sixth  (1/6th)  of any sum that may need to be repaid on the
                next  following  Reduction Date to ensure that the Loan does not
                exceed the Commitment on such Reduction Date; and

        (b)     the  applicable   fraction  (as  hereinafter   defined)  of  the
                aggregate  amount of interest falling due for payment in respect
                of each part of the Loan during and at the end of each  Interest
                Period  current at the  relevant  Retention  Date and,  for this
                purpose,  the  expression  "applicable  fraction" in relation to
                each Interest Period shall mean a fraction having a numerator of
                one and a  denominator  equal to the number of  Retention  Dates
                falling within the relevant Interest Period;

        "Retention Dates" means the date falling one (1) month after the date of
        this  Agreement  and each of the  dates  falling  at  monthly  intervals
        thereafter and "Retention Date" shall be construed accordingly;

        "Retention  Event" means any event,  including  without  limitation  the
        making of any Advance, resulting in:

        (a)     an amount becoming payable on the next following Reduction Date;
                and/or

        (b)     the amount repayable on the next following  Reduction Date being
                increased;

        "Security Documents" means:

        (a)     the Accounts Charges;

        (b)     this Agreement;

        (c)     the Assignment of Intra-Group Loan Agreements;

        (d)     the Charter Assignments;

        (e)     any Contract Assignment Consents and Acknowledgements;

        (f)     the Deeds of Covenant;

        (g)     the General Assignments;

        (h)     the Manager's Undertakings;

        (i)     the Master Swap Agreements;

        (j)     the Master Swap Assignment;

        (k)     the Mortgages;

        (l)     the Owner's Guarantees;

        (m)     any Pre-delivery Security Assignments;

        (n)     any Refund Guarantee Assignment Consents and Acknowledgements;

        (o)     any Share Charges; and

        (p)     any Tripartite Deed(s),

        and any  other  documents  as may have  been or shall  from time to time
        after the date of this Agreement be executed to guarantee  and/or secure
        all or any part of the Loan, interest thereon and other moneys from time
        to time owing by the Borrower pursuant to this Agreement (whether or not
        any such document also secures  moneys from time to time owing  pursuant
        to any other document or agreement);

        "Security  Party" means  collectively  the  Borrower,  the Builder,  the
        Refund  Guarantor,  the Owners and the  Manager  (to the extent that the
        Manager is Magnus  Carriers  Corporation or any other Related Company of
        the  Borrower  and/or  any  other  person  that  in the  opinion  of the
        Arrangers is associated with either Gabriel  Petridis and/or Mans Bolin)
        or any  other  person  who  may at any  time  be a  party  to any of the
        Security Documents (other than the Finance Parties and the Account Bank)
        and "Security Party" means any of them;

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

        "Security  Requirement" means the amount in Dollars (as certified by the
        Agent whose  certificate  shall,  in the absence of manifest  error,  be
        conclusive  and binding on the  Borrower  and the Banks) which is at any
        relevant time one hundred and forty per cent (140%) of the Loan;

        "Security  Value" means the amount in Dollars (as certified by the Agent
        whose certificate shall, in the absence of manifest error, be conclusive
        and binding on the Borrower and the Banks) which,  at any relevant time,
        is the  aggregate  of (a)  the  Fleet  Market  Value  as  most  recently
        determined in accordance with clause 8.2.2,  (b) the market value of any
        additional  security for the time being  actually  provided to the Banks
        pursuant to clause 8.2 and (c) the amount  standing to the credit of the
        Retention Account which is to be applied in repayment of the Loan or any
        part  thereof  (but not,  for the  avoidance  of doubt,  the  payment of
        interest on the Loan or any part thereof);

        "Seller" means:

        (a)     in relation to Stena Compassion,  the seller of Stena Compassion
                under the relevant Contract; and

        (b)     in relation to any Additional  Ship, the relevant  seller or the
                relevant Builder of such Additional Ship,

        and "Sellers" means all of them;

        "Share  Charge" means,  in relation to each Owner,  the charge of all of
        the  issued  shares in the  capital of such  Owner  executed  or (as the
        context  may  require) to be  executed  by the  Borrower  (or such other
        direct  shareholder of the Owner (being a wholly owned Subsidiary of the
        Borrower)  as the Agent may  require) in favour of the Agent as security
        agent and  trustee on behalf of the Finance  Parties  pursuant to clause
        8.1.13 such charge to be in form and  substance  acceptable to the Agent
        and "Share Charges" means all of them;

        "Shareholders Equity" has the meaning given to that term in clause 8.6;

        "Ship Security  Documents"  means, in relation to any Ship, the relevant
        Mortgage,   the  relevant  Deed  of  Covenant,   the  relevant   General
        Assignment, any Charter Assignment, any Tripartite Deed and the relevant
        Manager's Undertaking and "Ship Security Document" means any of them;

        "Ships"  means the  Initial  Ships and the  Additional  Ships and "Ship"
        means any of them;

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

        "Spill"  means any  actual or  threatened  emission,  spill,  release or
        discharge of a Pollutant into the environment;

        "Stena  Compassion" means m.v. "STENA  COMPASSION" whose particulars are
        set out in Part 1 of Schedule 2;

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

        "Substitution Certificate" means a certificate substantially in the form
        of  Schedule  5 (or in such  other  form as the Agent  shall  approve or
        require);

        "Swap  Banks"  means  the  banks and  financial  institutions  listed in
        Schedule 1, Part 2 and includes  their  respective  successors in title,
        Assignees and transferees and "Swap Bank" means any or all of them;

        "Taxes" includes all present and future taxes, levies, imposts,  duties,
        fees or charges of whatever  nature  together with interest  thereon and
        penalties  in  respect   thereof  and  "Taxation"   shall  be  construed
        accordingly;

        "Total Debt" has the meaning given to that term in clause 8.6;

        "Total Assets" has the meaning given to that term in clause 8.6;

        "Total Liabilities" has the meaning given to that term in clause 8.6;

        "Total Loss" means:

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

        (b)     the Compulsory Acquisition of a Ship; or

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

        "Transaction"  has  the  meaning  ascribed  to it  in  the  Master  Swap
        Agreements;

        "Tripartite  Deed" means in relation to any Ship which is the subject of
        a bareboat or demise  charter,  a  tripartite  deed  executed or (as the
        context  may  require)  to be executed  between  the  relevant  bareboat
        charterer of such Ship, the relevant Owner of such Ship and the Agent in
        form and substance  satisfactory to the Agent in its sole discretion and
        "Tripartite Deeds" means all of them; and

        "Underlying  Documents"  means  collectively  the Contracts,  the Refund
        Guarantees,   the   Management   Agreements,   any  Charter(s)  and  the
        Intra-Group Loan Agreements.

1.3     Headings

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

1.4     Construction of certain terms

        In this Agreement, unless the context otherwise requires:

1.4.1   references to clauses and schedules are to be construed as references to
        clauses of, and  schedules  to, this  Agreement  and  references to this
        Agreement include its schedules;

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

1.4.3   references to a "regulation"  include any present or future  regulation,
        rule,  directive,  requirement,  request or  guideline  (whether  or not
        having  the  force of law) of any  agency,  authority,  central  bank or
        government  department  or any  self-regulatory  or  other  national  or
        supra-national authority;

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

1.4.5   references to a time of day are to London time;

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

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

1.4.8   references  to acts or things to be done by the Agent and  references to
        the Agent entering into a Security  Document are to be construed as acts
        or thing  to be done for or by the  Agent,  or  security  to be given in
        favour of the Agent,  in the Agent's  capacity as agent,  security agent
        and trustee on behalf of the Banks; and

1.4.9   references  to any  enactment  shall be deemed to include  references to
        such enactment as re-enacted, amended or extended.

1.5     Agreed forms

        In this  Agreement,  any  document  expressed to be "in the agreed form"
        means  a  document  in a  form  agreed  by  (and  for  the  purposes  of
        identification  signed by or on behalf of) the Borrower and the Banks or
        (in the case of any of the other  Security  Documents) a document in the
        form actually  executed by both the relevant  Security Party or relevant
        Security Parties and the Agent and/or the Banks.

1.6     Contracts (Rights of Third Parties) Act 1999

        No term of this Agreement is enforceable  under the Contracts (Rights of
        Third  Parties)  Act  1999  by a  person  who is  not a  party  to  this
        Agreement.

1.7     Effectiveness of Majority Banks decision

        Where  this  Agreement  provides  for any  matter  to be  determined  by
        reference to the opinion of the  Majority  Banks or to be subject to the
        consent or request of the  Majority  Banks or for any action to be taken
        on the  instructions  of the  Majority  Banks,  such  opinion,  consent,
        request or instructions shall (as between the Banks, the Arrangers,  the
        Co-Arrangers,  the Swap Banks and the Agent)  only be regarded as having
        been validly given or issued by the Majority Banks if all the Banks, the
        Arrangers,  the  Co-Arrangers,  the Swap Banks and the Agent  shall have
        received  prior  notice of the  matter on which such  opinion,  consent,
        request or  instructions  are  required to be obtained and a majority of
        the  Banks and the  Agent  shall  have  given or  issued  such  opinion,
        consent, request or instructions.

2       The Facility

2.1     The Facility

        Subject  to the  terms  of  this  Agreement,  the  Banks  agree  to make
        available  to the  Borrower a Dollar  revolving  credit  facility  in an
        aggregate amount equal to the Commitment.

2.2     Obligations several

        The  obligations  of each Bank under this  Agreement  are  several;  the
        failure of any Bank to perform  such  obligations  shall not relieve any
        other Bank,  the Agent,  the Swap Banks or the  Borrower of any of their
        respective obligations or liabilities under this Agreement or the Master
        Swap Agreements,  nor shall the Agent be responsible for the obligations
        of any Bank  (except  for its own  obligations,  if any,  as a Bank) nor
        shall any Bank be  responsible  for the  obligations  of any other  Bank
        under this Agreement.

2.3     Interests several

        Notwithstanding  any other term of this  Agreement  the interests of the
        Arrangers,  the Agent,  the Swap Banks and the Banks are several and the
        amount due to each Arranger, the Agent (for its own account),  each Swap
        Bank and to each Bank is a separate  and  independent  debt.  The Agent,
        each  Arranger and each Bank shall have the right to protect and enforce
        their  respective  rights arising out of this Agreement and it shall not
        be  necessary  for the Agent,  any Arranger or any Bank (as the case may
        be) to be  joined as an  additional  party in any  proceedings  for this
        purpose.

2.4     Drawdown

        Subject to the terms and  conditions  of this  Agreement,  each  Advance
        shall be made  following  receipt  by the Agent from the  Borrower  of a
        Drawdown  Notice not later than 10 a.m. on the third  Banking Day before
        the Drawdown Date relative to such Advance, which shall be a Banking Day
        falling within the Drawdown Period, on which such Advance is intended to
        be made. A Drawdown  Notice shall be effective on actual  receipt by the
        Agent and, once given,  shall,  subject as provided in clause 3.6.1,  be
        irrevocable.  No Advances  shall be available  after the Repayment  Date
        and,  subject to the provision of this Agreement,  more than one Advance
        may be made on the same date.

2.5     Timing and limitation of Advances

2.5.1   The amount of each Advance shall, subject to the following provisions of
        this  clause 2.5, be for such  amount as is  specified  in the  Drawdown
        Notice of that Advance.

2.5.2   Each  Advance  shall be made solely for one of the  purposes  set out in
        clause 1.1.

2.5.3   No Advance of the Facility shall be available if:

        (a)     the making of that Advance would result in:

                (i)     more than twelve (12) Advances  then being  outstanding;
                        or

                (ii)    the  aggregate of all of the Advances  drawn down at any
                        relevant time exceeding the Commitment; and/or

        (b)     during  the period up to the date  falling  thirty  (30)  months
                after  the  date  of this  Agreement,  the  Loan  is,  or  would
                following the making of such Advance be,  greater than an amount
                equal to sixty five per cent (65%) of the Fleet Market Value; or

        (c)     during the period from the date falling thirty (30) months after
                the date of this Agreement  until the Repayment Date, the amount
                of the Loan is, or would  following  the making of such  Advance
                be,  greater than an amount equal to sixty per cent (60%) of the
                Fleet Market Value.

        For the purposes of  sub-clause  2.5.3(b) and (c) the Fleet Market Value
        shall be  ascertained  by  reference  to the  valuation  of the Ships in
        accordance  with clause 8.2.2  obtained not more than 30 days before the
        date upon which the relevant Advance is to be made.

2.5.4   The  Borrower  shall not be  entitled  to draw down any  Advance  in the
        period  falling one month  before any  Reduction  Date without the prior
        consent  of the  Majority  Banks  if  such  Advance  would  result  in a
        Retention Event occurring.

2.5.5   No Advance of the  Facility  which is to be  applied in  refinancing  an
        Initial Ship shall exceed the amount set out alongside that Initial Ship
        in Part 3 of  Schedule  2 so that the  aggregate  of the  Advances  made
        available to refinance  the Initial Ships shall never exceed two hundred
        and thirty four million three hundred and nine thousand nine hundred and
        ninety nine Dollars ($234,309,999).

2.5.6   The Advance  relative to Stena  Compassion shall be paid directly to the
        Seller of Stena Compassion, shall only be made available on the Delivery
        Date for Stena  Compassion  and  shall not  exceed  fifty  million  four
        hundred and ninety thousand Dollars ($50,490,000).

2.5.7   The aggregate of all Advances relative to general corporate purposes (as
        approved  by the  Arrangers  from time to time)  shall not  exceed  five
        million  Dollars  ($5,000,000)  and no  Advance  for  general  corporate
        purposes  shall  be  for  less  than  five  hundred   thousand   Dollars
        ($500,000).

2.5.8   No Advance relative to an Additional Ship shall be made available unless
        the vessel which the relevant  Additional Owner intends to acquire using
        the relevant  intra-group loan from the Borrower has been approved as an
        Additional  Ship,  which  approval shall only be granted by the Majority
        Banks if the relevant  vessel has met all the Additional  Ship Selection
        Criteria.  In relation to the  acquisition  by an Additional  Owner of a
        vessel the Borrower  shall be required to follow the  procedure  set out
        below:

        (a)     if the  Borrower  wishes to  drawdown  any part of the  Facility
                relative to Additional  Ships,  the Borrower shall first send to
                the  Arrangers  and the Agent a request  (the  "Request")  which
                shall include the information  described below and a copy of the
                inspection report for the relevant vessel;

        (b)     where the Request relates to a second-hand  vessel,  the Request
                shall include the following information:

                Name of vessel
                Flag
                Official Number
                IMO Number
                Purchase price
                Year built
                Type of vessel
                Gross tonnage/net tonnage
                Deadweight/cubic capacity/TEU of vessel
                Classification Society
                Class
                Seller
                Expected delivery date
                Charter  information (if any),  including name and credit rating
                (if any) of charterer,  charter  rate, %  commission,  period of
                charter, options (if any)
                Typical running costs for this type of vessel
                Next drydock: expected date of drydock and estimated amount
                Date of next special survey
                Requested loan amount
                Lightweight displacement of vessel;

        (c)     where the Request  relates to a vessel  which is a  newbuilding,
                the Request shall include the following information:

                Builder
                Hull No.
                Type of vessel
                Gross tonnage/net tonnage
                Deadweight/cubic capacity/TEU of vessel
                Date of Contract
                Date keel laid
                Original Contract Price
                Purchase price
                Payment terms under Contract
                Seller
                Scheduled delivery date
                Date when Buyer has option to cancel the Contract for  excessive
                delay
                Name of Refund Guarantor
                Type of Refund Guarantee
                Classification Society
                Class
                Flag on delivery.

2.5.9   With  respect  to any  vessel to be  financed  under the  Facility,  the
        Arrangers  and the Agent will use their  best  efforts to respond to any
        Request as soon as  possible  but in any event  within ten (10)  Banking
        Days of the receipt of the Request.

2.5.10  No Advance relative to an Additional Ship shall:

        (a)     exceed  whichever  shall be the lesser of (i) the Contract Price
                of the Additional Ship to be financed by way of such Advance and
                (ii) the Fair Market Value of the Additional Ship to be financed
                by way of such  Advance  and,  in the case where the  Additional
                Ship is a  newbuilding,  the Expected  Project Costs approved by
                the Agent in its sole discretion; nor

        (b)     be applied in financing any  Additional  Ship which has not been
                approved by the Arrangers  and the Agent as an  Additional  Ship
                (the "Approval") in accordance with clauses 2.5.8 and 2.5.9.

2.5.11  In  relation  to an  Additional  Ship which is a  newbuilding,  Contract
        Instalment Advances and a Delivery Date Advance for that Additional Ship
        shall be in sums of up to the amounts set out in the  relevant  Contract
        and  applied in or towards  payment of the  instalment  of the  Contract
        Price  for  that  Additional  Ship  and may be made on any  Banking  Day
        falling within the Drawdown Period up to and in the case of the Delivery
        Date Advance upon the Delivery Date for that  Additional Ship subject to
        the relevant  instalment of the Contract Price for that  Additional Ship
        having become due and payable by the relevant Owner under such Contract.

2.5.12  Any Advance  constituting  a Contract  Instalment  Advance or a Delivery
        Date Advance shall be applied in paying such relevant  instalment of the
        relevant  Contract  Price and shall be paid by the Banks to the relevant
        Builder or, as the case may be,  Seller and any  Advance  which is to be
        applied in meeting  Expected  Project Costs approved by the Agent in its
        sole discretion shall be paid by the Agent to the credit of the relevant
        Earnings Account as appropriate.

2.6     Expected Project Costs

        No Advance shall  constitute  Expected Project Costs only, other than in
        the case of a deposit  payable in respect of an Additional Ship pursuant
        to a Contract.  Any Drawdown Notices for Advances constituting (in part)
        Expected  Project Costs shall be accompanied  with invoices or pro-forma
        estimate  invoices  itemised in a written  inventory  each in a form and
        substance  acceptable  to the  Arrangers  and the  Agent in  their  sole
        discretion  certified by an officer of the Borrower and presented to the
        Agent no later than  fifteen  (15)  Banking  Days  before  the  relevant
        Drawdown Date.

2.7     Availability

        Upon  receipt  of a  Drawdown  Notice  complying  with the terms of this
        Agreement  the Agent shall notify each Bank thereof of the Drawdown Date
        and, subject to the provisions of clause 9, on the date specified in the
        Drawdown  Notice  each Bank shall make  available  to the  Borrower  its
        portion of the  Advance in  accordance  with clause  6.2.  The  Borrower
        acknowledges  that  payment of any  Advance to a Seller or any  Contract
        Instalment  Advance or Delivery  Date Advance to a Builder in accordance
        with clause 6.2 shall  satisfy the  obligation of the Banks to lend that
        Advance to the Borrower under this Agreement.

2.8     Application of proceeds

        Without prejudice to the Borrower's  obligations under clause 8.1.3, the
        Banks shall have no  responsibility  for the  application of proceeds of
        the Loan (or any part thereof) by the Borrower.

3       Interest and Interest Periods

3.1     Normal interest rate

        The  Borrower  shall pay interest on each Advance or the Loan in respect
        of each Interest Period relating  thereto on each Interest  Payment Date
        (or, in the case of Interest  Periods of more than three (3) months,  by
        instalments,  the first  three (3) months from the  commencement  of the
        Interest Period and the subsequent instalments at intervals of three (3)
        months  or,  if  shorter,  the  period  from the  date of the  preceding
        instalment  until the Interest  Payment Date  relative to such  Interest
        Period)  at  the  rate  per  annum  determined  by the  Agent  to be the
        aggregate of (a) the Margin,  (b) the Additional  Cost and (c) LIBOR for
        such Interest Period.

3.2     Selection of Interest Periods

        The Borrower may by notice  received by the Agent not later than 10 a.m.
        on the second  Banking Day before the beginning of each Interest  Period
        specify  whether such Interest  Period shall have a duration of one (1),
        three (3) or six (6) months or such  other  period as the  Borrower  may
        select and the Arrangers  may, in their  absolute  discretion,  agree. A
        maximum of three (3) one (1) month Interest Periods will be permitted in
        any one (1) calendar year.

3.3     Determination of Interest Periods

        Every Interest Period shall be of the duration specified by the Borrower
        pursuant to clause 3.2 but so that:

3.3.1   the first  Interest  Period in respect of each Advance shall commence on
        the date on which such Advance is made;

3.3.2   the initial  Interest  Period in respect of each Advance after the first
        Advance  shall end on the same day as the then current  Interest  Period
        for the Loan and, on the last day of such Interest Period,  all Advances
        shall be consolidated into, and shall thereafter constitute the Loan;

3.3.3   if any Interest Period would otherwise  overrun the Repayment Date, then
        such Interest Period shall end on the Repayment Date; and

3.3.4   if the Borrower  fails to specify the duration of an Interest  Period in
        accordance  with the  provisions  of clause 3.2 and this clause 3.3 such
        Interest  Period shall have a duration of three (3) months or such other
        period as shall comply with this clause 3.3.

3.4     Default interest

        If the Borrower fails to pay any sum (including, without limitation, any
        sum  payable  pursuant  to this  clause 3.4) on its due date for payment
        under any of the Security Documents,  the Borrower shall pay interest on
        such sum on demand  from the due date up to the date of  actual  payment
        (as well after as before  judgment)  at a rate  determined  by the Agent
        pursuant to this clause 3.4.  The period  beginning on such due date and
        ending on such date of payment shall be divided into successive  periods
        of not more than three (3) months as selected by the Agent each of which
        (other  than the first,  which  shall  commence  on such due date) shall
        commence  on the  last day of the  preceding  such  period.  The rate of
        interest  applicable  to each such  period  shall be the  aggregate  (as
        determined  by the  Agent) of (a) two per cent (2%) per  annum,  (b) the
        Margin,  (c) the  Additional  Cost and (d) LIBOR for such  period.  Such
        interest shall be due and payable on the last day of each such period as
        determined  by the Agent and each such day shall,  for the  purposes  of
        this Agreement,  be treated as an Interest  Payment Date, by reason of a
        declaration by the Agent under clause 10.2.2 or a prepayment pursuant to
        clauses  4.3,  4.5, 8.2 or 12.1  provided  that if such unpaid sum is an
        amount of principal which became due and payable on a date other than an
        Interest Payment Date relating  thereto,  the first such period selected
        by the Agent shall be of a duration  equal to the period between the due
        date of such  principal sum and such Interest  Payment Date and interest
        shall be payable on such  principal sum during such period at a rate two
        per cent (2%) above the rate applicable  thereto  immediately  before it
        shall have become so due and payable.  If, for the reasons  specified in
        clause 3.6.1, the Agent is unable to determine a rate in accordance with
        the foregoing  provisions  of this clause 3.4, each Bank shall  promptly
        notify the Agent of the costs of funds to such Bank and  interest on any
        sum not paid on its due date for payment  shall be  calculated at a rate
        determined  by the  Agent to be two per cent  (2%) per  annum  above the
        aggregate of (a) the Margin, (b) the Additional Cost and (c) the cost of
        funds to such Bank.

3.5     Notification of Interest Periods and interest rate

        The Agent shall  notify the  Borrower  promptly of the  duration of each
        Interest Period and of each rate of interest determined by it under this
        clause 3.

3.6     Market disruption; non-availability

3.6.1   If and whenever,  at any time prior to the  commencement of any Interest
        Period, the Agent shall have determined (which  determination  shall, in
        the absence of manifest error, be conclusive):

        (a)     that adequate and fair means do not exist for ascertaining LIBOR
                during such Interest Period; or

        (b)     the Agent shall have received notification from any of the Banks
                that  deposits in Dollars are not  available  to such Bank(s) in
                the ordinary  course of business in  sufficient  amounts to fund
                their   Contributions   for  such  Interest   Period  or,  where
                applicable,  that the quotation for LIBOR  (together with (where
                applicable)  the  normal  spread  being paid by any such Bank in
                respect of Dollar  borrowings)  does not accurately  reflect the
                cost to such Bank(s) of obtaining such deposit;

        the Agent shall forthwith give notice (a "Determination Notice") thereof
        to the Borrower and to each of the Banks. A  Determination  Notice shall
        contain  particulars  of the relevant  circumstances  giving rise to its
        issue.  After the giving of any Determination  Notice the undrawn amount
        of any of the  Commitments  of all the Banks shall not be borrowed until
        notice to the contrary is given to the Borrower by the Agent.

3.6.2   During the period of ten (10) days  after any  Determination  Notice has
        been given by the Agent under clause  3.6.1,  each Bank shall certify an
        alternative   basis  (the   "Substitute   Basis")  for  maintaining  its
        Contribution.  The  Substitute  Basis may (without  limitation)  include
        alternative  interest  periods,  alternative  currencies or  alternative
        rates of interest but shall  include a margin above the cost of funds to
        such Bank equivalent to the Margin.  Each Substitute  Basis so certified
        shall be binding upon the  Borrower and shall take effect in  accordance
        with its terms from the date specified in the Determination Notice until
        such  time  as  each  Bank  notifies  the  Borrower  that  none  of  the
        circumstances specified in clause 3.6.1 continues to exist whereupon the
        normal interest rate fixing provisions of this Agreement shall apply.

4       Repayment, prepayment, reduction and termination

4.1     Repayment

        The Facility shall be repaid in full on the Repayment Date.

4.2     Voluntary prepayment

        Subject to clause 4.8, the Borrower may prepay the Loan in whole or part
        on any  Interest  Payment  Date  relating  to the part of the Loan to be
        repaid without premium or penalty.

4.3     Additional voluntary prepayment

        Subject to clause 4.8, the Borrower may also prepay,  without premium or
        penalty,  but without  prejudice to its  obligations  under clauses 3.6,
        4.8, 6.7 and 12.2:

4.3.1   the  Contribution  of any Bank to which the  Borrower  shall have become
        obliged to pay additional amounts under clauses 3.6 or 12.2; or

4.3.2   any Bank's Contribution to which a Substitute Basis applies by virtue of
        clause 3.6.2.

        Upon any notice of such  prepayment  being given,  the Commitment of the
        relevant Bank shall be reduced to zero.

4.4     Mandatory Prepayments

4.4.1   The Borrower  shall  immediately  prepay such part of the Loan as may at
        any time be  necessary  to  ensure  that the Loan  does not  exceed  the
        Commitment.

4.4.2   If an Additional  Ship which is a second hand vessel is not delivered to
        the relevant Additional Owner under the relevant Contract for any reason
        whatsoever,  then the Borrower shall repay any Advance  constituting (in
        part) Expected  Project Costs  representing a deposit under the relevant
        Contract  not  later  than ten (10)  days  after  the date of  expiry or
        termination of such Contract.

4.5     Prepayment on Total Loss and Sale

        On a Ship becoming a Total Loss or suffering damage or being involved in
        an  incident  which in the  opinion of the Banks may result in such Ship
        being  subsequently  determined  to be a Total Loss or on any Ship being
        sold with the prior written consent of the Arrangers,  the obligation of
        the Banks to make any further  Advance under this Agreement  (other than
        any  Advance(s)  relating to Additional  Ship(s) which have already been
        approved  by the  Arrangers  and the Agent and (a) in  respect  of which
        Additional Ship(s) a Contract or Contracts  has/have been executed,  (b)
        in relation to which  Advance(s)  all  conditions  precedent to drawdown
        have been fully satisfied and (c) no Default has occurred or would arise
        as a result of the making of such Advance(s))  shall  immediately  cease
        and no further  Advances  shall be made  available  unless the Arrangers
        shall  otherwise agree until the Borrower has prepaid an amount equal to
        the entire Total Loss  proceeds or the entire sale proceeds (as the case
        may be).  Such  prepayment  must be made not later than the date falling
        one hundred and twenty (120) days after that on which such Ship became a
        Total Loss or, if earlier, on the date upon which the insurance proceeds
        in  respect  of such  Total  Loss  are or  Requisition  Compensation  is
        received by the Borrower (or the Agent/any of the Banks  pursuant to the
        Security Documents) or immediately on the completion of the sale of such
        Ship. For the purpose of this Agreement, a Total Loss shall be deemed to
        have occurred:

4.5.1   in the case of an actual  total loss of a Ship on the actual date and at
        the time such Ship was lost or, if such date is not  known,  on the date
        on which such Ship was last reported;

4.5.2   in the case of a constructive total loss of a Ship, upon the date and at
        the time notice of  abandonment of such Ship is given to the insurers of
        such  Ship  for the time  being  (provided  a claim  for  total  loss is
        admitted by such  insurers) or, if such insurers do not forthwith  admit
        such a claim,  at the date and at the time at which  either a total loss
        is subsequently admitted by the insurers or a total loss is subsequently
        adjudged by a  competent  court of law or  arbitration  tribunal to have
        occurred;

4.5.3   in the case of a  compromised  or arranged  total loss, on the date upon
        which a binding  agreement as to such compromised or arranged total loss
        has been entered into by the insurers of a Ship;

4.5.4   in the case of  Compulsory  Acquisition,  on the  date  upon  which  the
        relevant  requisition of title or other compulsory  acquisition  occurs;
        and

4.5.5   in the case of hijacking, theft, condemnation, capture, seizure, arrest,
        detention or  confiscation  of a Ship (other than where the same amounts
        to Compulsory  Acquisition of such Ship) by any Government Entity, or by
        persons  purporting  to act on behalf of any  Government  Entity,  which
        deprives  the Borrower of the use of such Ship for more than thirty (30)
        days,  upon the expiry of the period of thirty  (30) days after the date
        upon  which  the  relevant  hijacking,  theft,  condemnation,   capture,
        seizure, arrest, detention or confiscation occurred.

4.6     Reduction and Termination of Commitment

4.6.1   Any part of the  Commitment  undrawn at the end of the  Drawdown  Period
        shall thereupon be automatically cancelled.

4.6.2   The Commitment  shall be  permanently  reduced on each Reduction Date by
        the sum of Eleven  million  Dollars  ($11,000,000)  so that by the final
        Reduction  Date the  Commitment  shall have been  reduced by ninety nine
        million Dollars  ($99,000,000) (for the purposes of this clause 4.6, the
        "Reduction Amount").

4.6.3   The  Borrower  shall upon three (3) Banking  Days notice to the Agent be
        entitled to permanently  reduce or terminate any undrawn  portion of the
        Facility  (being a minimum of five million  Dollars  ($5,000,000) or any
        larger  sum  which  is an  integral  multiple  of five  million  Dollars
        ($5,000,000))  without penalty. Each such reduction shall be made to the
        Commitment in inverse order  commencing with that part of the Commitment
        which is not reduced by the Reduction Amount.

4.7     Amounts payable on prepayment

        Any  prepayment  of all  or  part  of  the  Loan  under  this  Agreement
        including,  without limitation,  pursuant to clauses 4.2, 4.5, 8.2.1 and
        12.1 shall be made together with:

4.7.1   accrued  interest  on the  amount  to be  prepaid  to the  date  of such
        prepayment;

4.7.2   any additional amount payable under clause 6.7 or 12.2; and

4.7.3   all other sums due and  payable by the  Borrower to the Banks under this
        Agreement  or any of the other  Security  Documents  including,  without
        limitation, any amounts payable under clause 11.

4.8     Notice of prepayment; reduction of repayment instalments

        No prepayment may be effected under clause 4.2 unless the Borrower shall
        have given the Agent (who shall notify each Bank thereof of the intended
        prepayment)  at least fifteen (15) days' notice of its intention to make
        such  prepayment.  Every notice of prepayment shall be effective only on
        actual  receipt by the Agent,  shall be  irrevocable,  shall specify the
        amount  to be  prepaid  and  shall  oblige  the  Borrower  to make  such
        prepayment on the date specified.

4.9     Reborrowing

        Subject to the terms of this  Agreement,  the  Borrower  may at any time
        prior to the Repayment  Date, but subject to no Default having  occurred
        and the  provisions of clause 2.5.4,  re-borrow any part of the Facility
        up to the  amount  of the  Commitment  that it may  have  repaid  and/or
        prepaid upon the same terms and conditions as set out in this Agreement.

4.10    Master Swap Agreements, Repayments and Prepayments

4.10.1  Notwithstanding  any  provision  of the Master  Swap  Agreements  to the
        contrary,  in the  case  of a  prepayment  of all or  part  of the  Loan
        (including,  without limitation, upon a sale or Total Loss in accordance
        with clause 4.5) then  subject to clause  4.10.2 the Swap Banks shall be
        entitled  but not  obliged  (and,  where  relevant,  may do without  the
        consent of the Borrower,  where it would  otherwise be required  whether
        under the  Master  Swap  Agreements  or  otherwise)  to amend,  re-book,
        supplement,  cancel, close out, net out, terminate,  liquidate, transfer
        or  assign  all or any  part of the  rights,  benefits  and  obligations
        created by any Transaction  and/or the Master Swap Agreements  and/or to
        obtain or  re-establish  any hedge or related  trading  position  in any
        manner and with any person the Swap Banks in their  absolute  discretion
        may determine.

4.10.2  If less than the full amount of the Loan remains outstanding,  following
        a prepayment  under this  Agreement and the Swap Banks in their absolute
        discretion agree, following a written request of the Borrower,  that the
        Borrower may be permitted to maintain all or part of a Transaction in an
        amount not wholly matched with or linked to all or part of the Loan, the
        Borrower  shall within ten (10) days of being notified by the Swap Banks
        of such  requirement,  provide  the Swap  Banks  with,  or  procure  the
        provision to the Swap Banks of, such additional security as shall in the
        opinion of the Swap Banks be adequate to secure the  performance of such
        Transaction,   which  additional  security  shall  take  such  form,  be
        constituted  by such  documentation  and be entered  into  between  such
        parties,  as the Swap Banks in their absolute  discretion may approve or
        require,  and each document  comprising such  additional  security shall
        constitute a Credit Support Document.

4.10.3  The  Borrower  shall on the  first  written  demand  of the  Swap  Banks
        indemnify  the Swap Banks in respect of all losses,  costs and  expenses
        (including,  but not limited to, legal costs and  expenses)  incurred or
        sustained  by the Swap Banks as a  consequence  of or in relation to the
        effecting of any matter or transactions referred to in this clause 4.10.

4.10.4  Without  prejudice to or limitation of the  obligations  of the Borrower
        under clause  4.10.3,  in the event that the Swap Banks  exercise any of
        their rights under clauses  4.10.1 and 4.10.2 and such exercise  results
        in all or part of a Transaction being terminated such Transaction or the
        part thereof  terminated (which shall for the purposes hereof be treated
        as a  separate  Transaction)  in each case  shall be  treated  under the
        Master Swap  Agreements  in the same  manner as if it were a  Terminated
        Transaction  (as  defined in Section 14 of the Master  Swap  Agreements)
        pursuant  to an Event of Default  (as so defined in that  Section 14) by
        the  Borrower  and,  accordingly,  the Swap Banks shall be  permitted to
        recover from the Borrower a payment for early termination  calculated in
        accordance  with the  provisions  of Section  6(e)(i) of the Master Swap
        Agreements in respect of such Transaction.

5       Commitment commission, fees and expenses

5.1     Fees

        The  Borrower  shall pay to the Agent for  distribution  to the Banks on
        each  Financial  Quarter Day and on the  Repayment  Date or such earlier
        date upon which the  Commitment  is  reduced  to zero or is  terminated,
        commitment  commission  computed from the date of this  Agreement at the
        rate of zero point five per cent  (0.5%) per annum on the daily  undrawn
        amount of the Commitment.

        The  commitment  commission  referred  to in this  clause  5.1  shall be
        payable  by the  Borrower  to the Agent  whether  or not any part of the
        Commitment is ever advanced.

        The  Borrower  shall pay any fees due under the Fee  Letter to the Agent
        and/or  Arrangers (as applicable)  upon the terms and conditions set out
        in the Fee Letter.

5.2     Expenses

        The Borrower shall pay to the Finance  Parties on a full indemnity basis
        on  demand  all  reasonable  expenses  (including  legal,  printing  and
        out-of-pocket expenses) incurred by the Finance Parties:

5.2.1   in connection with the  negotiation,  preparation,  execution and, where
        relevant,  registration of the Security Documents and/or the Master Swap
        Agreements  and of any  amendment or extension of or the granting of any
        waiver or consent under, any of the Security Documents and/or the Master
        Swap Agreements; and

5.2.2   in  contemplation  of, or otherwise in connection  with, the enforcement
        of, or preservation of any rights under,  any of the Security  Documents
        and/or the Master Swap Agreements, or otherwise in respect of the moneys
        owing  under  any of the  Security  Documents  and/or  the  Master  Swap
        Agreements,

        together  with  interest at the rate  referred to in clause 3.4 from the
        date on which such  expenses  were  incurred  to the date of payment (as
        well after as before judgment).

5.3     Value Added Tax

        All fees and  expenses  payable  pursuant to this clause 5 shall be paid
        together  with  value  added tax or any  similar  tax (if any)  properly
        chargeable  thereon.  Any value added tax  chargeable  in respect of any
        services  supplied by any of the Finance  Parties  under this  Agreement
        shall,  on delivery of the value added tax invoice,  be paid in addition
        to any sum agreed to be paid hereunder.

5.4     Stamp and other duties

        The Borrower  shall pay all stamp,  documentary,  registration  or other
        like  duties or taxes  (including  any  duties or taxes  payable  by any
        Finance  Party)  imposed on or in connection  with any of the Underlying
        Documents,  the  Security  Documents  and/or the Master Swap  Agreements
        and/or the Loan and shall  indemnify  the  Finance  Parties  against any
        liability  arising by reason of any delay or omission by the Borrower to
        pay such duties or taxes.

6       Payments and taxes; accounts and calculations

6.1     No set-off or counterclaim

        The Borrower  acknowledges  that in performing their  obligations  under
        this Agreement the Banks will be incurring  liabilities to third parties
        in relation to the funding of amounts to the Borrower,  such liabilities
        substantially  matching the liabilities of the Borrower to the Banks and
        that it is reasonable  for the Banks to be entitled to receive  payments
        from the Borrower  gross on the due date in order that the Banks are put
        in a position to perform  their  matching  obligations  to the  relevant
        third  parties.  Accordingly,  all  payments to be made by the  Borrower
        under any of the Security  Documents shall be made in full,  without any
        set-off or counterclaim  whatsoever  and,  subject as provided in clause
        6.7, free and clear of any deductions or withholdings, in Dollars on the
        due date to the account of the Agent or to such  account at such bank in
        such place as the Agent may from time to time specify for this  purpose.
        Save as  otherwise  provided by any  relevant  Security  Document,  such
        payments  shall be for the  account of all the Banks and the Agent shall
        forthwith  distribute such payments in like funds as are received by the
        Agent to the Banks  rateably in  accordance  with their  Commitments  or
        Contributions, as the case may be.

6.2     Payment by the Banks

        All  sums  to be  advanced  by the  Banks  to the  Borrower  under  this
        Agreement  in respect of the Loan  shall be  remitted  in Dollars on the
        date of the Drawdown Date for the relevant Advance to the account of the
        Agent at such bank as the Agent may have notified to the Banks and shall
        be paid by the Agent on such date in like funds as are  received  by the
        Agent to the account of the Borrower  and/or the Builder as specified in
        the Drawdown Notice for such Advance.

6.3     Agent may assume receipt

        Where any sum is to be paid under any of the  Security  Documents to the
        Agent for the account of another  person,  the Agent may assume that the
        payment  will be made  when  due and the  Agent  may (but  shall  not be
        obliged to) make such sum  available  to the person so  entitled.  If it
        proves to be the case that such payment was not made to the Agent,  then
        the  person  to whom  such sum was so made  available  shall on  request
        refund such sum to the Agent together with interest  thereon  sufficient
        to compensate the Agent for the cost of making  available such sum up to
        the date of such  repayment  and the person by whom such sum was payable
        shall  indemnify  the  Agent for any and all loss or  expense  which the
        Agent may sustain or incur as a consequence  of such sum not having been
        paid on its due  date.  If  such a sum is so  paid to the  Agent  by the
        Borrower,  the  Borrower  may assume that the Agent has paid such sum to
        the other person for whose account it was paid to the Agent.

6.4     Non-Banking Days

        When any payment under any of the Security  Documents would otherwise be
        due on a day which is not a Banking Day, the due date for payment  shall
        be extended to the next  following  Banking Day unless such  Banking Day
        falls in the next calendar  month in which case payment shall be made on
        the immediately preceding Banking Day.

6.5     Calculations

        All  interest  and other  payments of an annual  nature under any of the
        Security Documents shall accrue from day to day and be calculated on the
        basis of actual days elapsed and a 360 day year.

6.6     Certificates conclusive

        Any certificate or determination of the Agent or any Bank as to any rate
        of interest or any other amount  pursuant to and for the purposes of any
        of the Security  Documents  shall,  in the absence of manifest error, be
        conclusive and binding on the Borrower and (in the case of a certificate
        or determination by the Agent) on the Banks.

6.7     Grossing-up for Taxes

        If at any  time the  Borrower  is  required  to make  any  deduction  or
        withholding  in respect of Taxes from any  payment  due under any of the
        Security  Documents  for the account of any Bank or the Agent (or if the
        Agent is required to make any deduction or withholding from a payment to
        a Bank),  the sum due from the Borrower in respect of such payment shall
        be increased to the extent necessary to ensure that, after the making of
        such deduction or  withholding,  each Bank and the Agent receives on the
        due date for such  payment  (and  retains,  free from any  liability  in
        respect of such  deduction or  withholding),  a net sum equal to the sum
        which it would have received had no such deduction or  withholding  been
        required to be made and the Borrower  shall  indemnify each Bank and the
        Agent  against any losses or costs  incurred by any of them by reason of
        any failure of the Borrower to make any such deduction or withholding or
        by reason of any  increased  payment  not being made on the due date for
        such payment.  The Borrower shall  promptly  deliver to the Agent and/or
        the Banks any  receipts,  certificates  or other  proof  evidencing  the
        amounts  (if  any)  paid or  payable  in  respect  of any  deduction  or
        withholding as aforesaid.

6.8     Claw-back of Tax benefit

        If,  following any such  deduction or  withholding  as is referred to in
        clause 6.7 from any payment by the Borrower, the Agent or any Bank shall
        receive  or be  granted  a credit  against  or  remission  for any Taxes
        payable by it,  the Agent or any Bank  shall,  subject  to the  Borrower
        having made any increased  payment in accordance  with clause 6.7 and to
        the extent that the Agent or any Bank can do so without  prejudicing its
        retention  of the  amount  of  such  credit  or  remission  and  without
        prejudice  to the  right of the  Agent or any Bank to  obtain  any other
        relief or allowance which may be available to it, reimburse the Borrower
        with  such  amount  as the  Agent  or any  Bank  shall  in its  absolute
        discretion  certify to be the  proportion of such credit or remission as
        will leave the Agent or any Bank (after such  reimbursement) in no worse
        position than it would have been in had there been no such  deduction or
        withholding from the payment by the Borrower.  Such reimbursement  shall
        be made forthwith upon the Agent or any Bank  certifying that the amount
        of the credit or remission has been received by it. Nothing contained in
        this  Agreement  shall oblige the Agent or any Bank to rearrange its tax
        affairs or to disclose  any  information  regarding  its tax affairs and
        computations.  Without prejudice to the generality of the foregoing, the
        Borrower shall not, by virtue of this clause 6.8, be entitled to enquire
        about the Agent's or any Bank's tax affairs.

6.9     Loan account

        Each Bank shall  maintain,  in accordance  with its usual  practice,  an
        account  evidencing  the amounts from time to time lent by, owing to and
        paid to it under the  Security  Documents.  The Agent  shall  maintain a
        control  account  (which shall be the "account  current"  referred to in
        certain of the  Mortgages)  showing the Loan and other sums owing by the
        Borrower  under the  Security  Documents  and all  payments  in  respect
        thereof  made by the  Borrower  from time to time.  The control  account
        shall,  in the absence of manifest error, be conclusive as to the amount
        from time to time owing by the Borrower under the Security Documents.

7       Representations and warranties

7.1     Continuing representations and warranties

        The  Borrower  represents  and  warrants to each of the Finance  Parties
        that:

7.1.1   Due incorporation

        the  Borrower  and  each  of  the  other   Security   Parties  are  duly
        incorporated  and validly  existing in good  standing  under the laws of
        Bermuda,  in the case of the  Borrower,  and, in the case of each of the
        other Security Parties,  under the laws of their respective countries of
        incorporation as limited liability  companies and have power to carry on
        their  respective  businesses as they are now being conducted and to own
        their respective property and other assets;

7.1.2   Corporate power

        the Borrower has power to execute,  deliver and perform its  obligations
        under the Underlying  Documents,  the Borrower's  Security Documents and
        the Master Swap  Agreements and to borrow the Commitment and each of the
        other Security  Parties has power to execute and deliver and perform its
        obligations under the Security Documents and the Underlying Documents to
        which it is or is to be a party;  all necessary  corporate,  shareholder
        and other action has been taken to authorise the execution, delivery and
        performance  of the same and no limitation on the powers of the Borrower
        to borrow will be exceeded as a result of borrowing the Loan;

7.1.3   Binding obligations

        the Underlying  Documents and the Security Documents and the Master Swap
        Agreements  constitute  or will,  when  executed,  constitute  valid and
        legally binding obligations of the relevant Security Parties enforceable
        in accordance with their respective terms;

7.1.4   No conflict with other obligations

        the execution and delivery of, the performance of its obligations under,
        and compliance with the provisions of, the Underlying  Documents and the
        Security  Documents  and the  Master  Swap  Agreements  by the  relevant
        Security Parties will not:

        (a)     contravene  any  existing  applicable  law,  statute,   rule  or
                regulation  or any  judgment,  decree  or  permit  to which  the
                Borrower or any other Security Party is subject;

        (b)     conflict  with,  or result in any breach of any of the terms of,
                or constitute a default under, any agreement or other instrument
                to which the Borrower or any other  Security Party is a party or
                is subject or by which it or any of its property is bound;

        (c)     contravene or conflict with any provision of the  memorandum and
                articles          of           association/articles           of
                incorporation/by-laws/statutes or other constitutional documents
                of the Borrower or any other Security Party; or

        (d)     result in the creation or  imposition  of or oblige the Borrower
                or any of its Related  Companies or any other  Security Party to
                create any Encumbrance  (other than a Permitted  Encumbrance) on
                any of the  undertakings,  assets,  rights  or  revenues  of the
                Borrower or its Related Companies or any other Security Party;

7.1.5   No litigation

        no litigation, arbitration or administrative proceeding is taking place,
        pending or, to the knowledge of the officers of the Borrower, threatened
        against  the  Borrower  or any of its  Related  Companies  or any  other
        Security  Party  which  could  have a  material  adverse  effect  on the
        business,  assets or  financial  condition of the Borrower or any of its
        Related Companies or any other Security Party;

7.1.6   No filings required

        save for the  registration  of the Mortgages in the relevant Flag States
        it is not necessary to ensure the legality, validity,  enforceability or
        admissibility  in evidence  of the  Underlying  Documents  or any of the
        Security  Documents or the Master Swap Agreements that they or any other
        instrument be notarised, filed, recorded,  registered or enrolled in any
        court,  public office or elsewhere in any Relevant  Jurisdiction or that
        any stamp, registration or similar tax or charge be paid in any Relevant
        Jurisdiction  on or in  relation  to  the  Underlying  Documents  or the
        Security  Documents  or the  Master  Swap  Agreements  and  each  of the
        Underlying  Documents  and the  Security  Documents  or the Master  Swap
        Agreements is in proper form for its  enforcement  in the courts of each
        Relevant Jurisdiction;

7.1.7   Choice of law

        the choice of English  law to govern the  Underlying  Documents  and the
        Security  Documents  (other  than the  Mortgages)  and the  Master  Swap
        Agreements  and the  choice of the laws of the  relevant  Flag  State to
        govern each Mortgage and the submissions by the Security  Parties to the
        non-exclusive jurisdiction of the English courts are valid and binding;

7.1.8   No immunity

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

7.1.9   Financial Statements

        the Form F-1  Registration  Statement  registered with the United States
        Securities  and  Exchange   Commission  and  the  pro  forma  historical
        consolidated  financial  statements of the Borrower's Group for the 2003
        and 2004 Financial  Years and the pro forma opening balance sheet of the
        Borrower's  Group  provided  to the  Banks  in the  negotiation  of this
        Agreement  have been  prepared in  accordance  with GAAP which have been
        consistently  applied and present  fairly and  accurately  the financial
        position  of the  Borrower  and the  Borrower's  Group  and at such date
        neither  the  Borrower  nor any member of the  Borrower's  Group had any
        significant  liabilities  (contingent or otherwise) or any unrealised or
        anticipated  losses which are not disclosed  by, or reserved  against or
        provided for in, such financial statements; and

7.1.10  Consents obtained

        every consent,  authorisation,  licence or approval of, or  registration
        with or declaration to,  governmental or public bodies or authorities or
        courts  required by any Security Party to authorise,  or required by any
        Security Party in connection  with, the execution,  delivery,  validity,
        enforceability  or  admissibility  in evidence of each of the Underlying
        Documents  and  each  of the  Security  Documents  and the  Master  Swap
        Agreements or the  performance by each Security Party of its obligations
        under the Underlying Documents and the Security Documents and the Master
        Swap  Agreements  has been  obtained  or made and is in full  force  and
        effect  and there has been no default  in the  observance  of any of the
        conditions or restrictions  (if any) imposed in, or in connection  with,
        any of the same;

7.1.11  No money laundering

        in  relation  to  the  borrowing  by  the  Borrower  of  the  Loan,  the
        performance and discharge of its obligations and liabilities  under this
        Agreement  and the  transactions  and  other  arrangements  effected  or
        contemplated  by this  Agreement,  the  Borrower  is acting  for its own
        account and that the foregoing will not involve or lead to contravention
        of any  law,  official,  requirement  or  other  regulatory  measure  or
        procedure  implemented  to combat  "money  laundering"  (as  defined  in
        Article 1 of the Directive  (91/308/EEC)  of the Council of the European
        Communities); and

7.1.12  Parent company

        each Owner is a  wholly-owned  Subsidiary  of the  Borrower  and Gabriel
        Petridis and Mans Bolin each  beneficially  own not less than 10% of the
        issued shares in the capital of the Borrower.

7.2     Initial representations and warranties

        The  Borrower  further  represents  and  warrants to each of the Finance
        Parties that:

7.2.1   Pari passu

        the obligations of the Borrower under this Agreement and the Master Swap
        Agreements  are direct,  general and  unconditional  obligations  of the
        Borrower and rank at least pari passu with all other  present and future
        unsecured and unsubordinated Indebtedness of the Borrower;

7.2.2   No default under other Indebtedness

        neither the Borrower nor any other Security Party is (nor would with the
        giving  of  notice  or lapse of time or the  satisfaction  of any  other
        condition or  combination  thereof be) in breach of or in default  under
        any  agreement  relating  to  Indebtedness  to which it is a party or by
        which it may be bound;

7.2.3   Information

        the information, exhibits and reports furnished by any Security Party to
        the Banks in connection  with the  negotiation  and  preparation  of the
        Security  Documents and the Master Swap Agreements are true and accurate
        in all material respects and not misleading,  do not omit material facts
        and all  reasonable  enquiries  have been  made to verify  the facts and
        statements  contained therein;  there are no other facts the omission of
        which would make any fact or statement therein misleading;

7.2.4   No withholding Taxes

        no Taxes are imposed by  withholding  or  otherwise on any payment to be
        made  by any  Security  Party  under  the  Underlying  Documents  or the
        Security Documents or the Master Swap Agreements or are imposed on or by
        virtue of the  execution  or  delivery  by the  Security  Parties of the
        Underlying  Documents  or the  Security  Documents  or the  Master  Swap
        Agreements  or any  other  document  or  instrument  to be  executed  or
        delivered  under  any of the  Security  Documents  or  the  Master  Swap
        Agreements;

7.2.5   No Default

        no Default has occurred and is continuing;

7.2.6   No Default under any Contract or any Refund Guarantee

        no  relevant  Owner is in  default of any of its  obligations  under any
        Contract or any of its obligations upon the performance or observance of
        which  depend  the  continued  liability  of  any  Refund  Guarantor  in
        accordance with the terms of the relevant Refund Guarantee;

7.2.7   No Encumbrance in respect of pre-delivery security

        no relevant  Owner has  previously  charged,  encumbered or assigned the
        benefit of any of its rights,  title and  interest in or to any Contract
        or any Refund Guarantee and such benefit and all such rights,  title and
        interest are freely assignable and chargeable in the manner contemplated
        by the Security Documents;

7.2.8   Ship

        each  Mortgaged  Ship  will  on the  date of  this  Agreement  or on the
        relevant Delivery Date be:

        (a)     in the absolute  ownership of the relevant Owner who will on the
                date of this  Agreement  or on and after the  relevant  Delivery
                Date be the sole, legal and beneficial owner of that Ship;

        (b)     provisionally registered in the name of the relevant Owner under
                the  laws  and  flag of the  relevant  Flag  State  through  the
                relevant Registry;

        (c)     operationally seaworthy and in every way fit for service; and

        (d)     classed   with   the   relevant   Classification   free  of  all
                requirements and recommendations of the relevant  Classification
                Society;

7.2.9   Ships' employment

        a Mortgaged  Ship will not on the date of this Agreement or on or before
        the relevant  Delivery  Date be subject to any charter or contract or to
        any  agreement to enter into any charter or contract  which,  if entered
        into  after  the  date of the  relevant  Mortgage  or  relevant  Deed of
        Covenant would have required the consent of the Agent and on the date of
        this Agreement and on each relevant  Delivery Date there will not be any
        agreement or  arrangement  whereby the Earnings for such  Mortgaged Ship
        may be shared with any other person;

7.2.10  Freedom from Encumbrances

        no  Mortgaged   Ship,  nor  its  Earnings,   Insurances  or  Requisition
        Compensation  (each as defined in the relevant Mortgage or relevant Deed
        of Covenant) nor its Earnings Account nor any other properties or rights
        which are,  or are to be, the subject of any of the  Security  Documents
        nor any part thereof will be, on the date of this  Agreement  and on the
        relevant  Delivery  Date  for  such  Mortgaged  Ship,   subject  to  any
        Encumbrance other than a Permitted Encumbrance;

7.2.11  Environmental matters

        to the  best  of the  knowledge  and  belief  of the  Borrower  and  its
        officers:

        (a)     all Environmental  Laws applicable to any Fleet Vessel have been
                complied with and all consents,  licences and approvals required
                under such  Environmental  Laws have been  obtained and complied
                with; and

        (b)     no Environmental Claim has been made or threatened or is pending
                against any member of the  Borrower's  Group or any Fleet Vessel
                and not fully satisfied; and

        (c)     there has been no Environmental Incident;

7.2.12  No material adverse change

        there has been no material  adverse change in the financial  position of
        the Borrower,  any Owner or any member of the Borrower's Group from that
        described  by the  Borrower  to the  Banks  in the  negotiation  of this
        Agreement;

7.2.13  Copies true and complete

        the  copies  of  each of the  Underlying  Documents  delivered  or to be
        delivered  to the  Banks  pursuant  to  clause  9.1  are,  or will  when
        delivered  be, true and complete  copies of such  documents  and each of
        such  documents  will  when  delivered  constitutes  valid  and  binding
        obligations of the parties  thereto  enforceable in accordance  with its
        terms and  there  have  been no  amendments  or  variations  thereof  or
        defaults thereunder.

7.3     Repetition of representations and warranties

        On and as of the date of each  Advance  and  (except in  relation to the
        representations  and warranties in clause 7.2) on each Interest  Payment
        Date the Borrower shall (a) be deemed to repeat the  representations and
        warranties  in clauses 7.1 (and so that  representation  and warranty in
        clause  7.1.9 shall for this  purpose  refer to the then latest  audited
        financial statements delivered to the Banks under clause 8.1) and 7.2 as
        if made with reference to the facts and  circumstances  existing on such
        day and (b) be deemed to further  represent  and  warrant to the Finance
        Parties that the then latest audited financial  statements  delivered to
        the Finance  Parties have been  prepared in  accordance  with GAAP which
        have been  consistently  applied and present  fairly and  accurately the
        financial  position of each of the Borrower and the Owners as at the end
        of the financial  period to which the same relate and the results of the
        operations  of each of the  Borrower  and the Owners  for the  financial
        period to which the same  relate  and,  as at the end of such  financial
        period,   neither  the  Borrower  nor  any  Owner  had  any  significant
        liabilities  (contingent  or otherwise) or any unrealised or anticipated
        losses which are not disclosed  by, or reserved  against or provided for
        in, such financial statements.

8       Undertakings

8.1     General

        The Borrower  undertakes with each of the Finance Parties that, from the
        date of this  Agreement and so long as any moneys are owing under any of
        the  Security  Documents  and  while  all or any part of the  Commitment
        remains outstanding, it will:

8.1.1   Notice of Default

        (a)     promptly inform the Agent and each of the Finance Parties of any
                occurrence  of which it  becomes  aware  which  might  adversely
                affect  the  ability  of  any  Security  Party  to  perform  its
                obligations   under  any  of  the  Security   Documents  or  the
                Underlying  Documents  and/or the Master  Swap  Agreements  and,
                without  limiting the generality of the  foregoing,  will inform
                the  Agent  and  each  of the  Finance  Parties  of any  Default
                forthwith  upon  becoming  aware  thereof  and will from time to
                time, if so requested by the Agent or any Finance Party, confirm
                to the Agent and each of the  Finance  Parties in writing  that,
                save as otherwise  stated in such  confirmation,  no Default has
                occurred and is continuing;

        (b)     promptly inform the Agent and each of the Finance Parties of any
                occurrence  of which it  becomes  aware  which  might  adversely
                affect the ability or rights of the  Borrower to make any claims
                under a Refund Guarantee or which might reduce or release any of
                the  obligations  of  a  Refund   Guarantor  under  such  Refund
                Guarantee;

8.1.2   Consents and licences

        without  prejudice to clauses 7.1 and 9, obtain or cause to be obtained,
        maintain  in full force and effect and comply in all  material  respects
        with  the  conditions  and  restrictions  (if  any)  imposed  in,  or in
        connection  with, every consent,  authorisation,  licence or approval of
        governmental  or public bodies or authorities or courts and do, or cause
        to be done,  all other  acts and  things  which may from time to time be
        necessary  or  desirable  under  applicable  law for the  continued  due
        performance of all the obligations of the Security Parties under each of
        the Security  Documents,  the Master Swap  Agreements and the Underlying
        Documents;

8.1.3   Use of proceeds

        use the Loan exclusively for the purpose specified in clause 1.1;

8.1.4   Pari passu

        ensure  that  its  obligations  under  this  Agreement  shall,   without
        prejudice to the provisions of clause 8.2 or to the security intended to
        be created by the Security Documents and the Master Swap Agreements,  at
        all times rank at least pari passu with all its other present and future
        unsecured  and  unsubordinated  Indebtedness  with the  exception of any
        obligations which are mandatorily preferred by law and not by contract;

8.1.5   Financial statements

        prepare  financial  statements  of the  Borrower  and  the  consolidated
        financial statements of the Borrower's Group and procure that each Owner
        prepares  financial  statements  in  accordance  with GAAP  consistently
        applied  in  respect  of each  Financial  Year and  cause the same to be
        reported on by its auditors  (which shall be  acceptable to the Agent in
        its  sole  discretion)  and  prepare  unaudited  consolidated  financial
        statements for the Borrower's Group in respect of each Financial Quarter
        on the same basis as the annual statements and deliver as many copies of
        the  same as the  Finance  Parties  may  reasonably  require  as soon as
        practicable but not later than one hundred and eighty (180) days (in the
        case of audited financial statements) or sixty (60) days (in the case of
        unaudited financial statements) after the end of the financial period to
        which they relate;

8.1.6   Delivery of reports

        deliver to the  Finance  Parties as many  copies as they may  reasonably
        require of every  material  report,  circular,  notice or like  document
        issued by the Borrower to its shareholders or creditors generally;

8.1.7   Provision of financial and other information

        deliver and provide the Finance Parties with:

        (a)     financial projections for each Financial Quarter;

        (b)     budgets for each Financial Year;

        (c)     appraisal  reports and  valuations  for each Ship on a quarterly
                basis pursuant to clause 8.2.2;

        (d)     copies of any filings by the Borrower  with, and reports to, the
                United States Securities and Exchange Commission;

        (e)     quarterly   Compliance    Certificates   (including   supporting
                schedules); and

        (f)     such  financial and other  information  concerning the Borrower,
                the other Security Parties and their respective  affairs as they
                may from time to time reasonably require;

8.1.8   Obligations under Security Documents

        duly and  punctually  perform  each of the  obligations  expressed to be
        assumed by it under the Security  Documents,  the Master Swap Agreements
        and the Underlying Documents;

8.1.9   Compliance with ISM Code

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

8.1.10  Withdrawal of DOC and SMC

        and will procure that any Operator will, immediately inform the Agent if
        there is any  threatened  or actual  withdrawal of its, or an Operator's
        DOC or the SMC in respect of a Mortgaged Ship;

8.1.11  Issuance of DOC and SMC

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

8.1.12  Compliance with ISPS Code

        and  will  procure  that  each  Mortgaged  Ship  will  comply  with  the
        requirements  of the  ISPS  Code  including  (but  not  limited  to) the
        maintenance  and renewal of the ISSC for each Mortgaged Ship pursuant to
        the ISPS  Code and will  immediately  inform  the  Agent if there is any
        actual or threatened withdrawal of the ISSC for any Mortgaged Ship;

8.1.13  Share Charges

        procure,  at any time  during  the  Security  Period,  execution  by the
        Borrower (or such other direct shareholder of the Owner (being an wholly
        owned Subsidiary of the Borrower) as the Agent may require) in favour of
        the Agent of a Share  Charge with  respect to any Owner and the Borrower
        agrees, if and when required to do so by the Agent (as instructed by the
        Banks),  promptly to execute or to procure the execution and delivery to
        the Agent of all  documents  which the Agent may  require  to obtain the
        full  benefit  of such  charges  over all of the  issued  shares  in the
        capital of the Owners;

8.1.14  Shareholding in Borrower

        procure that at all times each Owner  remains a wholly owned  subsidiary
        of the Borrower and that Gabriel  Petridis and Mans Bolin each  maintain
        beneficial  ownership  of not less than 10% of the issued  shares in the
        capital of the Borrower;

8.1.15  Manager's bank accounts

        procure that the Manager opens and  maintains the Manager's  Account and
        all of its other bank accounts with the Account Bank;

8.1.16  Owner's Guarantee

        procure that on or prior to the  Drawdown  Date of each Advance that the
        relevant Owner executes and delivers to the Agent an Owner's Guarantee;

8.1.17  Charter Assignment

        procure  that the  relevant  Owner  executes and delivers to the Agent a
        Charter  Assignment  relating to any Mortgaged Ship which is the subject
        of a Charter;

8.1.18  Listing on NASDAQ

        maintain its listing as a public limited company on NASDAQ or such other
        stock exchange  acceptable to the Arrangers in their sole discretion and
        comply with all of the listing rules, laws and regulations applicable to
        public  companies  listed  on  NASDAQ  or such  other  acceptable  stock
        exchange;

8.1.19  Intra-Group Loan Agreements

        procure that all interest payment dates and all repayment dates relating
        to the loans to be made  pursuant  to the  Intra-Group  Loan  Agreements
        match those of each relevant  Advance  drawn down by the Borrower  under
        this Agreement in order to make each of the said loans  available to the
        Owners and shall procure and ensure that all sums paid and/or payable by
        the  Owners  to the  credit  of the  Earnings  Accounts  shall be freely
        available to the Agent to meet all  payments of  principal  and interest
        and all other  sums  payable  by the  Borrower  to the  Finance  Parties
        pursuant to this Agreement and each of the other Security Documents;

8.1.20  Know your customer and money laundering compliance

        provide the Banks with such  documents  and  evidence as the Banks shall
        from time to time require,  based on applicable law and regulations from
        time to time and the Banks' own "know your customer" internal guidelines
        from  time to time to  identify  the  Borrower  and the  other  Security
        Parties,  including the ultimate legal and beneficial owner or owners of
        such  entities,  and any  other  persons  involved  or  affected  by the
        transaction(s) contemplated by this Agreement; and

8.1.21  Interest Rate Hedging Agreement

        should it  determine  to do so,  enter  into  acceptable  interest  rate
        hedging  agreements  in  relation  to the  Facility,  including  without
        limitation Transactions under the Master Swap Agreements,  with any Bank
        and to the extent that such interest rate hedging  agreements are not or
        do not form part of the  Master  Swap  Agreements,  such  interest  rate
        hedging shall be secured in such manner as the Arrangers may require.

8.2     Security value maintenance

8.2.1   Security shortfall

        If at any time on or after the first  Drawdown  Date the Security  Value
        shall be less than the relevant Security Requirement, the Agent may give
        notice to the Borrower  requiring  that such  deficiency be remedied and
        then the Borrower shall (unless a Ship has become a Total Loss) either:

        (a)     prepay  within  a period  of  fifteen  (15)  days of the date of
                receipt by the  Borrower of the Agent's  said notice such sum in
                Dollars as will result in the  Security  Requirement  after such
                prepayment  (taking into account any other repayment of the Loan
                made  between  the  date  of the  notice  and  the  date of such
                prepayment) being equal to the Security Value; or

        (b)     within  thirty (30) days of the date of receipt by the  Borrower
                of the Agent's said notice constitute to the satisfaction of the
                Banks such further  security for the Loan as shall be acceptable
                to the Banks having a value for security purposes (as determined
                by the  Banks in their  absolute  discretion)  at the date  upon
                which such further  security  shall be constituted  which,  when
                added to the Security Value, shall not be less than the Security
                Requirement as at such date.

        Clause 4.7 shall apply to prepayments under clause 8.2.1(a).

8.2.2   Valuation of a Ship

        A Ship shall,  for the purposes of this clause 8.2, be valued in Dollars
        two (2) weeks prior to the Delivery Date for such Ship and thereafter on
        a quarterly  basis or if earlier  the date upon which the Initial  Ships
        are valued or would have been valued and  thereafter  all the Ships then
        financed by this  Agreement  shall be valued  quarterly  or  following a
        Default at any time  determined by the Agent.  The value of a Ship shall
        be calculated by taking the average of the charter free  valuations  for
        such Ship from two (2)  Approved  Brokers  (such  valuations  to be made
        without,  unless required by the Arrangers,  physical  inspection and on
        the  basis of a sale for  prompt  delivery  for cash at arm's  length on
        normal  commercial terms as between a willing buyer and a willing seller
        without  taking into  account the benefit of any  charterparty  or other
        contract of  employment  concerning  such Ship).  Such  valuation  shall
        constitute the value of a Ship for the purposes of this clause 8.2 until
        the next following valuation.

        The value of a Ship determined in accordance with the provisions of this
        clause 8.2 shall be binding  upon the parties  hereto until such time as
        any further such valuations shall be obtained.

8.2.3   Information

        The Borrower  undertakes  to the Finance  Parties to supply to the Agent
        and to any such shipbrokers  such information  concerning a Ship and its
        condition as such shipbrokers may reasonably  require for the purpose of
        making any such valuation.

8.2.4   Costs

        All costs in connection with the Agent obtaining any valuation of a Ship
        referred to in clause 8.2.2,  and any valuation either of any additional
        security for the purposes of ascertaining the Security Value at any time
        or  necessitated  by the  Borrower  electing  to  constitute  additional
        security pursuant to clause 8.2.1(b) shall be borne by the Borrower.

8.2.5   Valuation of additional security

        For the purpose of this clause 8.2, the market  value of any  additional
        security  provided or to be provided to the Banks shall be determined by
        the Banks in their  absolute  discretion  without any  necessity for the
        Banks assigning any reason thereto.

8.2.6   Documents and evidence

        In connection with any additional  security  provided in accordance with
        this clause 8.2,  the Banks shall be entitled to receive  such  evidence
        and documents of the kind referred to in Schedule 4 as may in the Banks'
        opinion be appropriate and such  favourable  legal opinions as the Banks
        shall in their absolute discretion require.

8.3     Negative undertakings

        The Borrower  undertakes with each of the Finance Parties that, from the
        date of this  Agreement  and so long as any moneys  are owing  under the
        Security  Documents  and/or the Master Swap  Agreements and while all or
        any part of the  Commitment  remains  outstanding,  it will not and will
        procure  that each Owner will not without the prior  written  consent of
        the Majority Banks:

8.3.1   Negative pledge

        permit any Encumbrance (other than a Permitted  Encumbrance) to subsist,
        arise or be created or  extended  over all or any part of its present or
        future  undertakings,  assets,  rights or revenues  (including,  but not
        limited  to the  Borrower's  rights  against  the Swap  Banks  under any
        Transactions  and/or the Master  Swap  Agreements  or all or part of the
        Borrower's  interest in any amounts  payable to the Borrower by the Bank
        under any  Transaction  and/or the Master Swap  Agreements) to secure or
        prefer  any  present  or  future  Indebtedness  or  other  liability  or
        obligation of the Borrower or any other person;

8.3.2   No merger

        to the extent  permitted  by law,  merge or  consolidate  with any other
        person;

8.3.3   Disposals

        sell,  transfer,  abandon,  lend or  otherwise  dispose  of or  cease to
        exercise  direct  control  over any  part  (being  either  alone or when
        aggregated  with all other  disposals  falling to be taken into  account
        pursuant  to this clause  8.3.3  material in the opinion of the Banks in
        relation  to  the  undertakings,  assets,  rights  and  revenues  of the
        Borrower's Group) of its present or future undertaking,  assets,  rights
        or revenues  (otherwise  than by transfers,  sales or disposals for full
        consideration  in the  ordinary  course of trading)  whether by one or a
        series of transactions related or not;

8.3.4   Other business

        undertake  any business  other than the  ownership  and operation of the
        Ships and the chartering of the Ships to third parties;

8.3.5   Acquisitions

        acquire any further assets other than the Ships and rights arising under
        contracts  entered  into by or on behalf of the Borrower or any Owner in
        the ordinary course of its business of owning,  operating and chartering
        the Ship;

8.3.6   Other obligations

        incur  any  obligations   except  for  obligations   arising  under  the
        Underlying  Documents  or the  Security  Documents  or the  Master  Swap
        Agreements  or  contracts  entered  into in the  ordinary  course of its
        business of owning, operating and chartering the Ships;

8.3.7   No borrowing

        incur any  Borrowed  Money  except for  Borrowed  Money  pursuant to the
        Security Documents;

8.3.8   Repayment of borrowings

        repay  the  principal  of,  or  pay  interest  on or  any  other  sum in
        connection  with any of its Borrowed  Money  except for  Borrowed  Money
        pursuant to the Security Documents;

8.3.9   Guarantees

        issue any  guarantees or  indemnities  or otherwise  become  directly or
        contingently  liable  for  the  obligations  of  any  person,  firm,  or
        corporation  except  pursuant to the Security  Documents  and except for
        guarantees  or  indemnities  from time to time  required in the ordinary
        course by any  protection  and indemnity or war risks  association  with
        which the Ships is entered,  guarantees  required to procure the release
        of a Ship from any arrest,  detention,  attachment or levy or guarantees
        or undertakings required for the salvage of such Ship);

8.3.10  Loans

        make any  loans  (other  than  the  loans  under  the  Intra-Group  Loan
        Agreements)  or grant any credit  (save for normal  trade  credit in the
        ordinary  course of business) to any person or agree to do so and in the
        case of the loans to be made under the Intra-Group Loan Agreements,  the
        Borrower will not without the prior  written  agreement of the Agent and
        except as envisaged in clause 14.5 accept any repayments of principal or
        interest  or other  sums due or  payable  thereunder  or take any action
        against any Owner;

8.3.11  Sureties

        permit any  Indebtedness  of the Borrower to any person  (other than the
        Banks)  to  be  guaranteed  by  any  person  (save  for   guarantees  or
        indemnities  from time to time  required in the  ordinary  course by any
        protection and indemnity or war risks association with which any Ship is
        entered,  guarantees  required  to procure  the  release a Ship from any
        arrest,  detention,  attachment or levy or  guarantees  or  undertakings
        required for the salvage of such Ship);

8.3.12  Share capital and distribution

        purchase  or  otherwise  acquire  for value any shares of its capital or
        (where a Default  has  occurred or  following  the  declaration  of such
        dividend,  in the Agent's opinion, a Default shall occur) declare or pay
        any  dividends  or  distribute  any of its  present  or  future  assets,
        undertakings, rights or revenues to any of its shareholders;

8.3.13  Subsidiaries and parent

        form or acquire any Subsidiaries other than in the case of the Borrower,
        the Owners or cease to legally and  beneficially  own 100% of the issued
        shares in the capital of the Owners, whether directly or indirectly; and

8.3.14  Financial Year

        make any change to the Financial  Year for the Borrower or any member of
        the Borrower's Group.

8.4     Pre-delivery positive undertakings

        In relation to each Additional Ship which is a newbuilding, the Borrower
        undertakes  and agrees with each of the Finance  Parties that it will or
        will procure that the relevant Owner will:

8.4.1   Document of title to an Additional Ship

        give  irrevocable  instructions  to the  relevant  Builder  to hold such
        Additional Ship and the builder's  certificate and any other document of
        title to such  Additional  Ship to the order and at the  disposal of the
        Agent  and  ensure  that  the  relevant   Builder   complies  with  such
        instructions;

8.4.2   Performance of the Contract

        duly  and  punctually   observe  and  perform  all  the  conditions  and
        obligations imposed on it by the relevant Contract;

8.4.3   Performance by Builder

        use its best  endeavours  to ensure that the Builder of such  Additional
        Ship observes and performs all conditions and obligations  imposed on it
        by the  relevant  Contract and take all steps within its power to ensure
        that the Builder  proceeds with the construction of such Additional Ship
        with due diligence and despatch;

8.4.4   Progress of construction

        upon the request of the Finance  Parties,  advise the Finance Parties of
        the  progress of  construction  of such  Additional  Ship and supply the
        Finance  Parties  with  such  other  information  as  they  may  require
        regarding  such  Additional  Ship,  and the materials  allocated to such
        Additional  Ship, the relevant  Contract,  or otherwise  relating to the
        construction of such Additional Ship;

8.4.5   Arbitration under the Contract

        in the  event  that the  Builder  of such  Additional  Ship  and/or  the
        relevant  Owner  resort  to  arbitration  as  provided  in the  relevant
        Contract,  immediately  notify the Finance  Parties in writing that such
        arbitration has been initiated, advise the Finance Parties in writing of
        the identity of the appointed  arbitrators  and upon  termination of the
        arbitration  notify the  Finance  Parties in writing to that  effect and
        supply the Finance  Parties with a copy of the  arbitration  award and a
        certified English translation thereof;

8.4.6   Conveyance on default

        where  such  Additional  Ship is (or is to be) sold in  exercise  of any
        power  contained in the relevant  Pre-delivery  Security  Assignment  or
        otherwise conferred on the Agent, to execute,  forthwith upon request by
        the Agent,  such form of conveyance of such Additional Ship as the Agent
        may require;

8.4.7   Enforcement of Owner's rights

        do or permit to be done  each and every act or thing  which the  Finance
        Parties  may from time to time  require  to be done for the  purpose  of
        enforcing the relevant  Owner's rights under or pursuant to the relevant
        Contract and allow the name of the relevant Owner to be used as and when
        required by the Agent for that purpose;

8.4.8   Notification of rejection of an Additional Ship

        notify the Finance Parties  immediately if the relevant Builder or (with
        the prior written consent of the Agent given pursuant to clause 8.5) the
        relevant Owner cancels, rescinds, repudiates or otherwise terminates the
        relevant  Contract  or  purports  to do so or (with  the  prior  written
        consent of the Agent given  pursuant to clause 8.5) the  relevant  Owner
        rejects such  Additional Ship or purports to do so or if such Additional
        Ship shall become a Total Loss or partial loss or shall be damaged;

8.4.9   Ship's name and registration

        register such Additional  Ship  provisionally  or permanently  under the
        laws and flag of the  relevant  Flag State  immediately  upon  Delivery,
        procure that (if such Additional Ship is so registered  provisionally on
        the Delivery Date) such Additional Ship is permanently  registered under
        the laws and flag of the  relevant  Flag  State  within  the time  limit
        imposed by the  relevant  Flag  State  (subject  always to the  relevant
        Mortgage  remaining  in full force and effect) and keep such  Additional
        Ship  registered  at all times from the Delivery Date under the laws and
        flag of the relevant Flag State; and

8.4.10  Mortgage

        execute,  and procure the registration of, the Mortgage relative to such
        Additional  Ship  under  the laws and flag of the  relevant  Flag  State
        immediately upon Delivery.

8.5     Pre-delivery negative undertakings

        In relation to each Additional Ship which is a newbuilding, the Borrower
        hereby further  undertakes  and agrees with each of the Finance  Parties
        that it will not,  and will  procure  that the  relevant  Owner will not
        without the prior written  consent of the Majority  Banks (and then only
        subject to such conditions as the Agent may impose):

8.5.1   Sale or other disposal

        sell or agree to sell,  transfer,  abandon or otherwise  dispose of such
        Additional Ship or any share or interest therein;

8.5.2   Creation of Encumbrances

        create or agree to create or permit to subsist any Encumbrance over such
        Additional  Ship  (or any  share or  interest  therein)  other  than the
        Encumbrances   created  or  to  be  created  pursuant  to  the  Security
        Documents;

8.5.3   Variation of Contract

        agree to any  variation  of the  relevant  Contract  or any  substantial
        variation  of the  specification  of such  Additional  Ship (and for the
        purpose of this paragraph any extras, additions or alterations which the
        relevant  Owner may desire to effect in the building of such  Additional
        Ship shall be deemed to constitute a  substantial  variation if the cost
        thereof  (which  shall in every  case be agreed in writing  between  the
        relevant  Owner and the relevant  Builder before the work is put in hand
        irrespective  of  whether  the  prior  consent  thereto  of the Agent be
        required  hereunder)  or if the  aggregate  cost  of the  proposed  work
        together with the cost of any work already  ordered will alter the fixed
        price of any of such  Additional Ship by an amount greater than five per
        cent (5%) of the said fixed price);

8.5.4   Releases and waivers of Contract

        release  the  relevant  Builder  from any of its  obligations  under the
        relevant  Contract  or  waive  any  breach  of  the  relevant  Builder's
        obligations  thereunder  or consent to any such act or  omission  of the
        relevant Builder as would otherwise constitute such breach;

8.5.5   Delays

        without  prejudice  to  clause  8.5.3,  agree  to any  variation  of the
        relevant  Contract or the  specification  of such  Additional Ship which
        would delay the time for delivery of such Additional Ship;

8.5.6   Rejection and cancellation

        either  exercise or fail to exercise any right which the relevant  Owner
        may  have to  reject  such  Additional  Ship or  cancel  or  rescind  or
        otherwise  terminate the relevant Contract provided always that any such
        rejection of such Additional Ship or  cancellation,  rescission or other
        termination  of the relevant  Contract by the relevant  Owner after such
        consent  is given  shall be  without  responsibility  on the part of the
        Finance Parties who shall be under no liability whatsoever to the extent
        that  such  rejection,   rescission,   cancellation  or  termination  is
        thereafter  adjudged to constitute a repudiation or other breach of such
        Contract by the relevant Owner;

8.5.7   Assignment of Earnings

        assign or agree to assign  otherwise  than to the Agent the  Earnings of
        such Additional Ship or any part thereof;

8.5.8   Variation of a Refund Guarantee

        agree to any variation of the relevant Refund Guarantee;

8.5.9   Release and waiver of the Refund Guarantee

        release the relevant Refund Guarantor from any of its obligations  under
        the relevant Refund Guarantee or waive any breach of the relevant Refund
        Guarantor's  obligations  thereunder  or  consent  to  any  such  act or
        omission of such Refund  Guarantor as would  otherwise  constitute  such
        breach;

8.5.10  Chartering

        let or agree to let such Additional Ship:

        (a)     on demise charter for any period; or

        (b)     by any  time or  consecutive  voyage  charter  for a term  which
                exceeds or which by virtue of any  optional  extensions  therein
                contained may exceed twelve (12) months' duration; or

        (c)     on terms whereby more than two months' hire (or the  equivalent)
                is payable in advance; or

        (d)     below  the  market  rate   prevailing  at  the  time  when  such
                Additional Ship is fixed or other than on arms length terms;

8.5.11  Manager

        to appoint a manager of such Additional Ship (other than the Manager) or
        to terminate or amend the terms of any Management Agreement.

8.6     Financial Covenant definitions

        For the purposes of clause 8.7 the following  expressions shall have the
        following meanings:

        "Cash" means free and available  negotiable money,  orders,  cheques and
        bank  balances  and  deposits  but to  exclude  (a)  any  cash  that  is
        specifically  blocked and charged and (b) cash standing to the credit of
        any blocked account and charged to the Agent pursuant to this Agreement;

        "Cash Equivalent Investments" means at any time:

        (a)     certificates  of  deposit  maturing  within  one year  after the
                relevant date of  calculation  and issued by a bank or financial
                institution acceptable to the Agent;

        (b)     any  investment  in  marketable  debt   obligations   issued  or
                guaranteed  by the  government  of the United States of America,
                the United  Kingdom,  any member state of the European  Economic
                Area or any Participating  Member State or by an instrumentality
                or agency of any of them  having an  equivalent  credit  rating,
                maturing  within one year after the relevant date of calculation
                and not convertible or exchangeable to any other security; or

        (c)     any other debt security approved by the Arrangers,

        in  each  case,  to  which  any  member  of  the  Borrower's   Group  is
        beneficially entitled at that time and which is not issued or guaranteed
        by any member of the  Borrower's  Group or  subject  to any  Encumbrance
        (other than one arising under the Security Documents).

        "Current Assets" means, at any time in respect of the Borrower's  Group,
        the amount of current assets of the  Borrower's  Group on a consolidated
        basis  which  would be  included  as  current  assets in a  consolidated
        balance sheet of the Borrower's  Group in accordance  with GAAP drawn up
        at such time;

        "Current  Liabilities"  means,  at any time in respect of the Borrower's
        Group,  the amount of current  liabilities of the Borrower's  Group on a
        consolidated basis which would be included as current liabilities in the
        consolidated  balance sheet of the Borrower's  Group in accordance  with
        GAAP drawn up at such time excluding Deferred Revenue;

        "Debt Service" means, in respect of any period, the aggregated:

        (a)     Interest Payable for such period;

        (b)     the  total  amount  of  all  scheduled  (but  not  voluntary  or
                mandatory)  repayments of the Facilities made by the Borrower or
                which fell due during such period; and

        (c)     the  total  amount  of  all  scheduled  (but  not  voluntary  or
                mandatory)  repayments of principal under the terms of any other
                Indebtedness  (save for any  revolving,  overdraft  or ancillary
                facility that is available for simultaneous re-drawing according
                to its terms)  made by the  members of the  Borrower's  Group or
                which fell due  during  such  period,  including  the  principal
                element of scheduled  rental payments which under GAAP should be
                treated as a finance lease or otherwise capitalised on the books
                of such person, in accordance with such principles;

        "Deferred Revenue" means at any time in respect of the Borrower's Group,
        that  liability  calculated at the time an existing  Charter(s) or other
        employment  arrangement  is assumed,  by  discounting  at the Borrower's
        Group's  weighted  average cost of capital,  the difference  between the
        market  charter rate for an  equivalent  vessel and the assumed  charter
        rate (as set out in the then latest  financial  statements  delivered to
        the  Finance  Parties  pursuant to clause  8.1.5),  which  liability  is
        recorded as deferred revenue and amortised to revenue over the remaining
        period of such Charter(s) or other employment arrangement;

        "EBITDA" means,  in respect of any period,  the  consolidated  profit on
        ordinary  activities of the  Borrower's  Group before  Taxation for such
        period:

        (a)     adjusted to exclude Interest Receivable and Interest Payable and
                other  similar  income  or  costs  to  the  extent  not  already
                excluded;

        (b)     adjusted to exclude any gain or loss realised on the disposal of
                fixed assets (whether tangible or intangible);

        (c)     after adding back depreciation and amortisation;

        (d)     adjusted to exclude any  exceptional or  extraordinary  costs or
                income;

        (e)     after  deducting  any profit  arising  out of the release of any
                provisions against a liability or charge;

        "Equity Ratio" means Shareholders Equity as a percentage of Total Assets
        adjusted,  in each case, for the  difference  between Fleet Market Value
        and Fleet Book Value;

        "Finance  Lease" means any lease under which a member of the  Borrower's
        Group is the lessee  which is or should be  treated  as a finance  lease
        under GAAP (and includes any hire purchase contract or other arrangement
        which is similarly treated);

        "Financial  Quarter" means each period of approximately three (3) months
        commencing  on the day after a  Financial  Quarter Day and ending on the
        next following Financial Quarter Day;

        "Financial  Quarter Day" means 31 March,  30 June,  30 September  and 31
        December in any year;

        "Financial  Year" means the annual  accounting  period of the Borrower's
        Group ending on 31 December in each year;

        "Fleet Book Value" means, at the end of a Relevant Period, the aggregate
        book value of the Ships less  depreciation  as stated in the most recent
        financial statements delivered pursuant to clause 8.1.5;

        "Fleet Market Value" means, at the date of calculation, the aggregate of
        the Fair Market Values of all of the Mortgaged  Ships as last determined
        in accordance with clause 8.2.2;

        "Free  Liquid  Assets"  means,  at any  given  time,  all  Cash and Cash
        Equivalent Investments held by the Borrower's Group less an amount equal
        to the Debt Service due and payable during the immediately following two
        Financial Quarters;

        "Interest"  means,  in  respect of any  specified  Borrowed  Money,  all
        continuing  regular or periodic costs,  charges and expenses incurred in
        effecting, servicing or maintaining such Borrowed Money including:

        (a)     gross interest,  commitment  fees,  discount and acceptance fees
                and guarantee,  fronting and ancillary  facility fees payable or
                incurred on any form of such Borrowed Money;

        (b)     repayment  and  prepayment   premiums  payable  or  incurred  in
                repaying or prepaying such Borrowed Money; and

        (c)     the interest element of Finance Leases,

        but excluding, in respect of such Borrowed Money, agency and arrangement
        fees or other up-front fees;

        "Interest  Payable"  means,  in respect  of any  period,  the  aggregate
        (calculated on a consolidated basis) of:

        (a)     the amounts  charged and posted (or  estimated to be charged and
                posted)  as a current  accrual  accrued  during  such  period in
                respect of members of the Borrower's Group by way of Interest on
                all  Borrowed  Money,  but  excluding  any  amount  accruing  as
                interest in-kind (and not as cash pay) to the extent capitalised
                as principal during such period; and

        (b)     net  payments in relation to interest  rate or currency  hedging
                arrangements  in respect of Borrowed Money (after  deducting net
                income in relation  to such  interest  rate or currency  hedging
                arrangements);

        "Interest  Receivable"  means,  in respect of any period,  the amount of
        Interest accrued on cash balances of the Borrower's Group (including the
        amount of interest accrued on the Earnings Accounts,  to the extent that
        the account  holder is entitled to receive  such  interest)  during such
        period;

        "Minimum  Liquidity"  means,  at any time in respect  of the  Borrower's
        Group, the minimum amount of Cash and Cash Equivalent  Investments which
        is equal to 5% of interest bearing debt;

        "Relevant Period" means each rolling period of twelve (12) months ending
        on a Financial Quarter.

        "Shareholders  Equity"  means,  at any time in respect of the Borrower's
        Group,  the amount of shareholders  equity of the Borrower's  Group on a
        consolidated basis which would be included as shareholders equity in the
        consolidated  balance sheet of the Borrower's  Group in accordance  with
        GAAP drawn up at such time;

        "Total  Assets" means,  at any time in respect of the Borrower's  Group,
        the amount of total  assets of the  Borrower's  Group on a  consolidated
        basis which would be included as total assets in a consolidated  balance
        sheet of the Borrower's  Group in accordance  with GAAP drawn up at such
        time;

        "Total Debt" means,  at any time, the aggregate  outstanding  principal,
        capital or nominal amount of all Borrowed Money of the Borrower's  Group
        calculated on a consolidated basis at that time;

        "Total  Liabilities" means, at any time in the respect of the Borrower's
        Group,  the amount of total  liabilities  of the  Borrower's  Group on a
        consolidated  basis which would be included as total  liabilities in the
        consolidated  balance sheet of the Borrower's  Group in accordance  with
        GAAP drawn up at such time; and

        "Working   Capital"  means  Current  Assets  less  Current   Liabilities
        (including,  at any given time,  the  current  portion of long term debt
        maturing within six (6) months).

8.7     Financial Covenants

        The Borrower  undertakes with each of the Finance Parties that, from the
        date of this  Agreement and so long as any moneys are owing under any of
        the  Security  Documents  and  while  all or any part of the  Commitment
        remains outstanding, it will:

8.7.1   Equity Ratio

        maintain an Equity Ratio of not less than 35%;

8.7.2   Minimum Liquidity

        maintain on a consolidated basis the Minimum Liquidity;

8.7.3   Working Capital

        maintain on a consolidated  basis on each  Financial  Quarter Day during
        the Security Period Working Capital of not less than zero Dollars ($0);

8.7.4   Interest coverage

        maintain a ratio of EBITDA to  Interest  Payable on a trailing  four (4)
        Financial Quarter basis of not less than 3.00 to 1.00;

8.7.5   Security Value Maintenance

        ensure  that at all  times  the  Security  Value  is not  less  than the
        Security Requirement;

8.7.6   Liquidity of Manager

        ensure that the Manager shall at all times  maintain a credit balance in
        the Manager's Account of not less than $1,000,000; and

8.7.7   Compliance Certificate

        deliver to the Agent at the end of each  Financial  Quarter,  and at the
        same time as the unaudited  financial  statements  referred to in clause
        8.1.5,  a  Compliance  Certificate  issued and signed by the  Borrower's
        Chief Financial Officer certifying that the covenants  contained in this
        clause  8.7 are being  complied  with and  providing  full  calculations
        supporting  such  compliance  derived  from  the then  latest  financial
        statements of the  Borrower's  Group as lodged with the  Securities  and
        Exchange  Commission  of the United  States by way of Form 6K/20F,  such
        certificate to be substantially in the form set out in Schedule 6.

8.8     Financial testing

        The covenants in clause 8.7 shall be tested each  Financial  Quarter and
        details of compliance (or non-compliance) shall be provided to the Agent
        in accordance with clause 8.7.7.

9       Conditions

9.1     Documents and evidence

9.1.1   Commitment

        The  obligation of the Banks to make the Commitment  available  shall be
        subject  to  the  condition  that  the  Agent,  or its  duly  authorised
        representative,  shall have  received the documents and evidence set out
        in Part 1 of Schedule 4.

9.1.2   First Advance

        The obligation of the Banks to make the first Advance available shall be
        subject  to  the  condition  that  the  Agent  or  its  duly  authorised
        representative  shall have  received not later than two (2) Banking Days
        before the day on which the  Drawdown  Notice  for the first  Advance is
        given,  the documents and evidence  specified in Part 2 of Schedule 4 in
        form and substance satisfactory to the Banks.

9.1.3   All Advances

        The obligation of the Banks to make each Advance shall be subject to the
        further condition that the Agent, or its duly authorised representative,
        shall have  received on or prior to the relevant  Drawdown  Date of such
        Advance, the documents and evidence specified in Part 3 of Schedule 4 in
        form and substance satisfactory to the Banks.

9.1.4   Contract Instalment Advances

        The  obligation  of the Banks to make any  Advance  which is a  Contract
        Instalment  Advance shall be subject to the condition that the Agent, or
        its duly authorised representative,  shall have received, on or prior to
        the day on which that Advance is intended to be made,  the documents and
        evidence  specified  in  Part 4 of  Schedule  4 in  form  and  substance
        satisfactory to the Banks.

9.1.5   Expected Project Costs

        The  obligation of the Banks to make any Advance for an Additional  Ship
        which is a newbuilding constituting in part Expected Project Costs shall
        be  subject  to the  further  condition  that  the  Agent,  or its  duly
        authorised  representative,  shall have  received  invoices or pro-forma
        invoices  itemised in a written  inventory which properly and accurately
        represents the Expected  Project Costs to the  satisfaction of the Agent
        in its sole discretion.

9.2     General conditions precedent

        The  obligation of the Banks to make any Advance shall be subject to the
        further  conditions  that,  at the time of the  giving  of the  Drawdown
        Notice in respect of the relevant Advance, and at the time of the making
        of the relevant Advance:

9.2.1   the representations and warranties contained in (i) clauses 7.1, 7.2 and
        7.3,  and  (ii)  clauses  4.1  and  4.3 of each  Owner's  Guarantee  and
        expressed  to be made or repeated  on the date of each  Advance are true
        and correct on and as of each such time as if each was made with respect
        to the facts and circumstances existing at such time; and

9.2.2   no Default  shall have  occurred and be  continuing or would result from
        the making of such Advance.

9.3     Waiver of conditions precedent

        The  conditions  specified in this clause 9 are inserted  solely for the
        benefit  of the Banks and may be waived by the Banks in whole or in part
        and with or without conditions.

9.4     Further conditions precedent

        Not later than five (5) Banking Days prior to each Drawdown Date and not
        later than five (5) Banking Days prior to each  Interest  Payment  Date,
        the Banks may request  and the  Borrower  shall,  not later than two (2)
        Banking  Days prior to such date,  deliver to the Banks on such  request
        further favourable  certificates and/or opinions as to any or all of the
        matters  which are the  subject of clauses 7, 8, 9 and 10 and  clauses 4
        and 5 of each Owner's Guarantee.

10      Events of Default

10.1    Events

        There shall be an Event of Default if:

10.1.1  Non-payment: any Security Party fails to pay any sum payable by it under
        any of the Security  Documents or the Underlying  Documents at the time,
        in the currency and in the manner  stipulated in the Security  Documents
        or the Underlying Documents (and so that, for this purpose, sums payable
        on demand shall be treated as having been paid at the stipulated time if
        paid within three (3) Banking Days of demand); or

10.1.2  Master Swap  Agreements:  (a) an Event of Default or Potential  Event of
        Default  (in each case as  defined in the Master  Swap  Agreements)  has
        occurred and is  continued  under the Master Swap  Agreements  or (b) an
        Early  Termination  Date (as defined in the Master Swap  Agreements) has
        occurred or been or become capable of being effectively designated under
        the  Master  Swap  Agreements  or (c) a person  entitled  to do so gives
        notice of an Early Termination Date under Section 6(b)(iv) of the Master
        Swap  Agreements  or (d)  any  Master  Swap  Agreements  is  terminated,
        cancelled, suspended, rescinded or revoked or otherwise ceases to remain
        in full force and effect for any reason; or

10.1.3  Breach of Insurance and certain other  obligations:  the Borrower or any
        Owner fails to obtain and/or maintain the Insurances (as defined in, and
        in accordance with the  requirements  of, the Security  Documents) for a
        Ship or if any  insurer  in  respect  of  such  Insurances  cancels  the
        Insurances  or  disclaims  liability  by  reason,  in  either  case,  of
        mis-statement  in any  proposal  for the  Insurances  or for  any  other
        failure or default on the part of the Borrower or any Owner or any other
        person or the  Borrower  or any Owner  commits any breach of or omits to
        observe any of the obligations or  undertakings  expressed to be assumed
        by it under clauses 8.2 or 8.3 or 8.4; or

10.1.4  Breach of other obligations: any Security Party commits any breach of or
        omits to observe  any of its  obligations  or  undertakings  (including,
        without  limitation,  any Financial Covenant) expressed to be assumed by
        it  under  any  of the  Security  Documents  or  any  of the  Underlying
        Documents  (other than those  referred  to in clauses  10.1.1 and 10.1.3
        above)  and,  in respect  of any such  breach or  omission  which in the
        opinion of the Banks is capable of remedy,  such action as the Banks may
        require shall not have been taken within fourteen (14) days of the Banks
        notifying  the  relevant  Security  Party  of such  default  and of such
        required action; or

10.1.5  Misrepresentation:  any  representation or warranty made or deemed to be
        made or repeated by or in respect of any  Security  Party in or pursuant
        to any of the Security Documents and/or the Master Swap Agreements or in
        any notice,  certificate or statement  referred to in or delivered under
        any of the Security  Documents  and/or the Master Swap Agreements or any
        of the  Underlying  Documents  is or proves to have  been  incorrect  or
        misleading in any material respect; or

10.1.6  Cross-default:  any  Indebtedness of any Security Party is not paid when
        due (following the expiry of any grace periods) or any  Indebtedness  of
        any Security Party becomes  (whether by declaration or  automatically in
        accordance with the relevant  agreement or instrument  constituting  the
        same) due and payable  (following the expiry of any grace periods) prior
        to the date when it would  otherwise have become due (unless as a result
        of the exercise by the relevant  Security Party of a voluntary  right of
        prepayment),  or any creditor of any Security Party becomes  entitled to
        declare any such  Indebtedness  due and payable  (each of the  aforesaid
        events,  for the  purposes of this clause  10.1.6 only an  "Indebtedness
        Event") or any facility or  commitment  available to any Security  Party
        relating to Indebtedness is withdrawn,  suspended or cancelled by reason
        of any default  (however  described) of the person  concerned unless the
        relevant  Security  Party  shall  have  satisfied  the  Banks  that such
        Indebtedness  Event,  withdrawal,  suspension or  cancellation  will not
        affect or prejudice in any way the relevant  Security Party's ability to
        pay its  debts  as  they  fall  due and  fund  its  commitments,  or any
        guarantee  given by any Security Party in respect of Indebtedness is not
        honoured  when due and called  upon  (following  the expiry of any grace
        periods); or

10.1.7  Legal process:  any judgment or order made against any Security Party is
        not stayed or complied with within seven (7) days or a creditor attaches
        or takes possession of, or a distress, execution, sequestration or other
        process  is  levied or  enforced  upon or sued out  against,  any of the
        undertakings,  assets,  rights or revenues of any Security  Party and is
        not discharged within seven (7) days; or

10.1.8  Insolvency:  the Borrower or any Owner is unable or admits  inability to
        pay its debts as they fall due;  suspends  making payments on any of its
        debts or announces an intention to do so; becomes insolvent;  has assets
        the  value of which is less than the  value of its  liabilities  (taking
        into account  contingent and  prospective  liabilities);  or suffers the
        declaration of a moratorium in respect of any of its Indebtedness; or

10.1.9  Reduction  or loss of capital:  a meeting is  convened  by any  Security
        Party for the purpose of passing any  resolution to purchase,  reduce or
        redeem any of its share capital; or

10.1.10 Winding up: any corporate  action,  legal proceedings or other procedure
        or step is taken for the purpose of winding up any Security  Party or an
        order is made or  resolution  passed for the winding up of any  Security
        Party or a notice  is issued  convening  a meeting  for the  purpose  of
        passing any such resolution; or

10.1.11 Administration: any petition is presented, notice given or other step is
        taken for the  purpose of the  appointment  of an  administrator  of any
        Security  Party or the  Banks  and/or  the Agent  believe  that any such
        petition or other step is imminent or an administration order is made in
        relation to any Security Party; or

10.1.12 Appointment  of receivers  and  managers:  any  administrative  or other
        receiver is appointed  of any  Security  Party or any part of its assets
        and/or  undertaking  or  any  other  steps  are  taken  to  enforce  any
        Encumbrance over all or any part of the assets of any Security Party; or

10.1.13 Compositions:   any  corporate   action,   legal  proceedings  or  other
        procedures  or  steps  are  taken,  or  negotiations  commenced,  by any
        Security  Party or by any of its  creditors  with a view to the  general
        readjustment or  rescheduling  of all or part of its  indebtedness or to
        proposing any kind of composition,  compromise or arrangement  involving
        such company and any of its creditors; or

10.1.14 Analogous proceedings:  there occurs, in relation to any Security Party,
        in any country or  territory in which any of them carries on business or
        to the jurisdiction of whose courts any part of their assets is subject,
        any event  which,  in the  reasonable  opinion  of the Banks  and/or the
        Agent,  appears in that country or territory to correspond with, or have
        an effect  equivalent  or similar to, any of those  mentioned in clauses
        10.1.7 to 10.1.12  (inclusive) or any Security Party  otherwise  becomes
        subject,  in any such country or territory,  to the operation of any law
        relating to insolvency, bankruptcy or liquidation; or

10.1.15 Cessation  of  business:  any  Security  Party  suspends  or  ceases  or
        threatens to suspend or cease to carry on its business; or

10.1.16 Seizure:  all or a material part of the undertaking,  assets,  rights or
        revenues  of, or shares or other  ownership  interests  in, any Security
        Party are seized, nationalised, expropriated or compulsorily acquired by
        or under the authority of any government; or

10.1.17 Invalidity: any of the Security Documents, the Master Swap Agreements or
        any of the  Underlying  Documents  shall at any time and for any  reason
        become  invalid or  unenforceable  or otherwise  cease to remain in full
        force and effect,  or if the  validity or  enforceability  of any of the
        Security Documents,  the Master Swap Agreements or any of the Underlying
        Documents  shall at any  time and for any  reason  be  contested  by any
        Security Party which is a party  thereto,  or if any such Security Party
        shall deny that it has any, or any further, liability thereunder; or

10.1.18 Unlawfulness:  it becomes  impossible  or  unlawful  at any time for any
        Security Party, to fulfil any of the covenants and obligations expressed
        to be assumed by it in any of the  Security  Documents,  the Master Swap
        Agreements  or any of the  Underlying  Documents or for the Agent or the
        Banks to exercise  the rights or any of them vested in them under any of
        the Security Documents or otherwise; or

10.1.19 Repudiation:   any  Security  Party   repudiates  any  of  the  Security
        Documents, the Master Swap Agreements or any of the Underlying Documents
        or does or causes or permits to be done any act or thing  evidencing  an
        intention to repudiate  any of the Security  Documents,  the Master Swap
        Agreements or any of the Underlying Documents; or

10.1.20 Encumbrances  enforceable:  any Encumbrance (other than Permitted Liens)
        in respect of any of the property (or part thereof) which is the subject
        of any of the  Security  Documents  and/or  the Master  Swap  Agreements
        becomes enforceable; or

10.1.21 Material  adverse  change:  there  occurs,  in the  opinion of the Banks
        and/or the Agent, a material  adverse change in the financial  condition
        of any Security Party as described by the Borrower or any Security Party
        to the Banks and/or the Agent in the negotiation of this Agreement; or

10.1.22 Arrest: any Ship is arrested,  confiscated,  seized, taken in execution,
        impounded,  forfeited, detained in exercise or purported exercise of any
        possessory lien or other claim or otherwise taken from the possession of
        the  Borrower  or Owner and the  Borrower or Owner shall fail to procure
        the release of such Ship  within a period of seven (7) days  thereafter;
        or

10.1.23 Registration:  the  registration  of any Ship under the laws and flag of
        the Flag State is  cancelled  or  terminated  without the prior  written
        consent of the Agent or, if any Ship is only provisionally registered on
        the relevant  Delivery  Date,  such Ship is not  permanently  registered
        under the laws and flag of the Flag State within the time limit  imposed
        by the relevant  Flag State  (subject  always to the  relevant  Mortgage
        remaining in full force and effect);

10.1.24 Unrest:  any of the Flag States becomes involved in hostilities or civil
        war or  there  is a  seizure  of  power  in any of the  Flag  States  by
        unconstitutional  means if, in any such case,  such  event  could in the
        opinion of the Banks and/or the Agent  reasonably  be expected to have a
        material  adverse  effect  on  the  security  constituted  by any of the
        Security Documents; or

10.1.25 Environmental Incidents:  there is an Environmental Incident which gives
        rise, or may give rise, to an  Environmental  Claim which could,  in the
        opinion  of the Banks  and/or the Agent be  expected  to have a material
        adverse  effect (i) on the  business,  assets,  operations,  property or
        financial  condition of any Security Party or the Borrower's Group taken
        as a whole or (ii) on the  security  constituted  by any of the Security
        Documents or the  enforceability of that security in accordance with its
        terms; or

10.1.26 P&I:  the  Borrower or any Owner or any other  person  fails or omits to
        comply with any requirements of the protection and indemnity association
        or other  insurer with which a Ship is entered for  insurance or insured
        against  protection and indemnity risks  (including oil pollution risks)
        to the effect that any cover (including,  without limitation,  any cover
        in  respect  of   liability   for   Environmental   Claims   arising  in
        jurisdictions where such Ship operates or trades) is or may be liable to
        cancellation, qualification or exclusion at any time; or

10.1.27 Parent company: any Owner ceases to be a wholly-owned  Subsidiary of the
        Borrower  and/or the Borrower  (without the prior written consent of the
        Banks) ceases to be a listed  company on NASDAQ or other stock  exchange
        acceptable  to  the  Arrangers  in  their  sole  discretion  and/or  the
        beneficial  shareholding  of each of Gabriel  Petridis and Mans Bolin in
        the Borrower  falls below 10% of the issued shares in the capital of the
        Borrower; or

10.1.28 Breach of  Contract:  there is a material  breach by the Borrower or any
        Owner,  a Seller or a Builder of any Contract or the  Borrower  fails to
        repay  any  Advance   constituting  (in  part)  Expected  Project  Costs
        representing  a deposit  under a Contract  relating  to a purchase of an
        Additional  Ship which is a second hand  vessel  within ten (10) days of
        the date of expiry or termination of the relevant Contract; or

10.1.29 Termination or variation of a Contract: a Contract is terminated for any
        reason  whatsoever  or a Contract is  frustrated or varied in any manner
        not  permitted  by or pursuant  to the  relevant  Pre-delivery  Security
        Assignment or this Agreement; or

10.1.30 Termination  of a Refund  Guarantee:  a Refund  Guarantee is repudiated,
        cancelled, rescinded or otherwise terminated; or

10.1.31 Non-Delivery  of Ship: a Ship is not  delivered to, and accepted by, the
        Borrower  or  relevant  Owner  under a  Contract  on or before the final
        permitted  delivery  date under the said Contract (or such later date as
        the Banks and/or the Agent in their  absolute  discretion,  may agree in
        writing); or

10.1.32 Material events: any other event occurs or circumstance arises which, in
        the  opinion of the Banks  and/or the Agent,  is likely  materially  and
        adversely to affect either

        (a)     the ability of any  Security  Party to perform all or any of its
                obligations  under or  otherwise to comply with the terms of any
                of the Security Documents or the Master Swap Agreements; or

        (b)     the security created by any of the Security Documents; or

10.1.33 Failure  to  drawdown  Delivery  Date  Advance:  the  Borrower  fails to
        drawdown a Delivery Date Advance  without the prior  written  consent of
        the Agent which shall not be unreasonably withheld; or

10.1.34 Intra-Group  Loans  Agreements:  the  Borrower  demands or  accepts  any
        repayments  of principal or interest or any other sum payable  under the
        Intra-Group  Loan  Agreements  save as envisaged by clause 14.5 or takes
        any action  against any Owner without the prior  written  consent of the
        Agent.

10.2    Acceleration

        The Agent may, with the prior approval of the Majority Banks and without
        prejudice  to any  other  rights  of the  Banks,  at any time  after the
        happening of an Event of Default by notice to the Borrower declare that:

10.2.1  the  obligation of each Bank to make its Commitment  available  shall be
        terminated,  whereupon  the  Commitment of each Bank shall be reduced to
        zero forthwith; and/or

10.2.2  the Loan and all  interest  and  commitment  commission  accrued and all
        other sums  payable  under the  Security  Documents  have become due and
        payable, whereupon the same shall, immediately or in accordance with the
        terms of such notice, become due and payable.

10.3    Demand basis

        If, pursuant to clause 10.2.2, the Agent declares the Loan to be due and
        payable  on  demand,  the Agent may  (with  the  prior  approval  of the
        Majority Banks) by written notice to the Borrower:

10.3.1  call  for  repayment  of the  Loan  on  such  date  as may be  specified
        whereupon the Loan shall become due and payable on the date so specified
        together  with all interest and  commitment  commission  accrued and all
        other sums payable under this Agreement; or

10.3.2  withdraw such  declaration  with effect from the date  specified in such
        notice.

11      Indemnities

11.1    Miscellaneous indemnities

        The  Borrower  shall on demand  indemnify  each Finance  Party,  without
        prejudice  to  any of  their  other  rights  under  any of the  Security
        Documents  or the Master Swap  Agreements,  against any loss  (including
        loss of Margin) or expense  which the Finance  Parties  shall certify as
        sustained or incurred by it as a consequence of:

11.1.1  any  default  in  payment  by the  Borrower  of any sum under any of the
        Security Documents when due;

11.1.2  the occurrence of any other Event of Default;

11.1.3  any  prepayment of the Loan or part thereof being made under clause 4.2,
        4.5,  8.2.1 or 12.1, or any other  repayment of the Loan or part thereof
        being made  otherwise  than on an Interest  Payment Date relating to the
        part of the Loan prepaid or repaid; or

11.1.4  any Advance not being made for any reason  (excluding any default by the
        Agent or any Bank) after the  Drawdown  Notice in  relation  thereto has
        been given,

        including,  in any such case,  but not  limited  to, any loss or expense
        sustained  or  incurred  by any  Bank  in  maintaining  or  funding  its
        Contribution  or any part  thereof  or in  liquidating  or  re-employing
        deposits  from  third  parties   acquired  to  effect  or  maintain  its
        Contribution  or any part thereof or any other amount owing to such Bank
        Provided  always  that no such  indemnity  shall be  payable in the case
        where such loss or expenses sustained or incurred has arisen as a result
        of the gross negligence or wilful misconduct of the Finance Parties.

11.2    Currency indemnity

        If any sum due from the Borrower under any of the Security  Documents or
        any  order or  judgment  given  or made in  relation  thereto  has to be
        converted from the currency (the "first  currency") in which the same is
        payable  under the  relevant  Security  Document  or under such order or
        judgment into another  currency (the "second  currency") for the purpose
        of:

11.2.1  making or filing a claim or proof against the Borrower;

11.2.2  obtaining an order or judgment in any court or other tribunal; or

11.2.3  enforcing any order or judgment  given or made in relation to any of the
        Security  Documents,  the Borrower shall indemnify and hold harmless the
        Agent and each Bank from and  against  any loss  suffered as a result of
        any difference between:

        (a)     the rate of exchange used for such purpose to convert the sum in
                question from the first currency into the second currency; and

        (b)     the rate or rates of exchange at which the Agent and/or any Bank
                may in the  ordinary  course  of  business  purchase  the  first
                currency with the second  currency upon receipt of a sum paid to
                it in  satisfaction,  in whole or in  part,  of any such  order,
                judgment, claim or proof. Any amount due from the Borrower under
                this clause  11.2 shall be due as a separate  debt and shall not
                be affected by judgment  being  obtained  for any other sums due
                under or in respect  of any of the  Security  Documents  and the
                term  "rate of  exchange"  includes  any  premium  and  costs of
                exchange  payable in  connection  with the purchase of the first
                currency with the second currency.

11.3    Environmental indemnity

        The Borrower shall  indemnify each Finance Party on demand in respect of
        all costs, claims, losses, demands, liabilities, penalties and fines, of
        whatever  nature  (including,  without  limitation,  those arising under
        Environmental  Laws) which may be  incurred or made  against any Finance
        Party at any time relating to, or arising  directly or indirectly in any
        manner  or for any cause or reason  whatsoever  out of an  Environmental
        Claim made or asserted  against  any Finance  Party which would or could
        not have been brought if such Finance  Party had not entered into any of
        the  Security  Documents  or been  involved  in any of the  transactions
        contemplated by the Security Documents.

12      Unlawfulness and increased costs

12.1    Unlawfulness

        If it is or becomes  contrary to any law or  regulation  for any Bank to
        make  any  Advance  to,  or to  maintain  its  Commitment  or  fund  its
        Contribution such Bank shall promptly, through the Agent, give notice to
        the Borrower whereupon:

12.1.1  such Bank's Commitment shall be reduced to zero; and

12.1.2  the Borrower  shall be obliged to prepay the  Contribution  of such Bank
        either:

        (a)     forthwith; or

        (b)     on a future  specified  date not being  earlier  than the latest
                date  permitted by the relevant law or regulation  together with
                interest  and  commitment  commission  accrued  to the  date  of
                prepayment and all other sums payable by the Borrower under this
                Agreement.

        In any  such  event  the  Borrower  and  the  Banks  shall  (as  per the
        provisions  of  clause  12.2)  negotiate  in  good  faith  (but  without
        incurring  any  legal  obligations)  with a view to  agreeing  terms for
        making  the Loan or any  Advance  (as the case  may be)  available  from
        another jurisdiction or funding the Loan or any Advance (as the case may
        be) from alternative sources.

12.2    Increased costs

        If the result of any change in, or in the  interpretation or application
        of,  or the  introduction  of,  any law or any  regulation,  request  or
        requirement  (whether or not having the force of law, but, if not having
        the force of law,  with which the Agent  and/or any Bank or, as the case
        may be, its holding company  habitually  complies),  including  (without
        limitation)  those relating to Taxation,  capital  adequacy,  liquidity,
        reserve assets, cash ratio deposits and special deposits, is to:

12.2.1  subject  any Bank to Taxes or change the basis of  Taxation  of any Bank
        with respect to any payment under any of the Security  Documents  (other
        than Taxes or Taxation  on the  overall net income,  profits or gains of
        such Bank imposed in the  jurisdiction in which its principal or lending
        office under this Agreement is located); and/or

12.2.2  increase the cost to, or impose an  additional  cost on, any Bank or its
        holding  company  in making  or  keeping  the  Commitment  available  or
        maintaining or funding its Contribution; and/or

12.2.3  reduce the amount payable or the effective  return to any Bank under any
        of the Security Documents; and/or

12.2.4  reduce any Bank's or its holding company's rate of return on its overall
        capital by reason of a change in the manner in which it is  required  to
        allocate capital  resources to its obligations under any of the Security
        Documents; and/or

12.2.5  require  any Bank or its  holding  company  to make a payment or forgo a
        return  on  or  calculated  by  reference  to  any  amount  received  or
        receivable by it under any of the Security Documents; and/or

12.2.6  require  any Bank or its  holding  company  to incur or  sustain  a loss
        (including  a loss of  future  potential  profits)  by  reason  of being
        obliged to deduct all or part of its  Commitment  from its  capital  for
        regulatory purposes,

        then and in each such case (subject to clause 12.3):

        (a)     such Bank  shall  notify the  Borrower  in writing of such event
                promptly upon its becoming aware of the same; and

        (b)     the Agent shall negotiate with the Borrower in good faith with a
                view  to  restructuring  the  transaction   constituted  by  the
                Security  Documents  in a way  which  will  (in  the  reasonable
                opinion  of  the   Agent)   satisfactorily   avoid   either  the
                unlawfulness  or increased costs concerned (each as the case may
                be) without either  decreasing the amounts or net returns due to
                the Agent and the Banks under the  Security  Documents  or which
                would,  but for such  unlawfulness or such increased costs (each
                as the case may be),  have been so due, or  otherwise  adversely
                affecting the rights,  interests and security of the Banks under
                the  transaction as presently  constituted  and will not (in the
                reasonable  opinion  of the  Agent)  increase  the  cost  to the
                Borrower  of or  otherwise  adversely  affect  the  rights,  and
                interests of the Borrower under the transactions (and unless the
                Agent nominates a longer period (which it shall be at liberty to
                do)),  such  negotiations  shall continue for a period of thirty
                (30) days after the  Borrower has been given notice under clause
                12.2.6(a)  or for  such  lesser  period  as is  permitted  under
                applicable law having regard to either the  unlawfulness  or the
                increased costs  concerned (such period called the  "Negotiation
                Period");

        (c)     if at the  end of the  Negotiation  Period  the  Agent  and  the
                Borrower have not reached  agreement on a  restructuring  of the
                transaction on the basis  described in sub-clause (b) above then
                the Borrower  shall on demand,  made at any time after expiry of
                the  Negotiation  Period  whether  or not  the  relevant  Bank's
                Contribution has been repaid,  pay to such Bank the amount which
                the Bank specifies (in a certificate  (which shall be conclusive
                in the absence of manifest error) setting forth the basis of the
                computation  of such amount but not  including any matters which
                such Bank  regards as  confidential  in  relation to its funding
                arrangements)  is  required  to  compensate  such  Bank for such
                alternative  funding,  increased  cost,  reduction,  payment  or
                forgone return.

        For the purposes of this clause 12.2 "holding company" means the company
        or entity (if any)  within the  consolidated  supervision  of which such
        Bank is included.

12.3    Exception

        Nothing in clause  12.2 shall  entitle any Bank to receive any amount in
        respect of  compensation  for any such liability to Taxes,  increased or
        additional  cost,  reduction,  payment,  foregone  return or loss to the
        extent  that the same is the  subject  of an  additional  payment  under
        clause 6.7.

13      Security, set-off and pro-rata payments

13.1    Application of moneys

        All moneys  received by the Agent  and/or the Banks under or pursuant to
        any  of  the  Security  Documents  and  expressed  to be  applicable  in
        accordance  with the  provisions of this clause 13.1 shall be applied by
        the Agent and/or the Banks in the following manner:

13.1.1  first in or toward payment of all unpaid fees,  commissions and expenses
        which may be owing to any  Finance  Party  (other  than the Swap  Banks)
        under  any of  the  Security  Documents  (other  than  the  Master  Swap
        Agreements);

13.1.2  secondly  in or towards  payment of any  arrears  of  interest  owing in
        respect of the Loan or any part thereof;

13.1.3  thirdly in or towards repayment of the Loan (whether the same is due and
        payable or not);

13.1.4  fourthly  in or  towards  payment to any Bank for any loss  suffered  by
        reason of any such payment in respect of principal not being effected on
        an Interest Payment Date relating to the part of the Loan repaid;

13.1.5  fifthly in or towards  payment  to any  Finance  Party of any other sums
        owing to it under any of the Security Documents;

13.1.6  sixthly in or towards  payments to the Swap Banks of any sum  (including
        without limitation all unpaid, fees,  commissions and expenses) owing to
        the Swap Banks under the Master Swap  Agreements and on a pro rata basis
        as between such Swap Banks;

13.1.7  seventhly,  in or  towards  payments  to any Swap Bank of any other sums
        owing to it under any of the Security  Documents  and/or the Master Swap
        Agreements; and

13.1.8  lastly,  the  surplus  (if  any)  shall  be paid to the  Borrower  or to
        whomsoever else may be entitled to receive such surplus,

        or in such other manner as the Banks may determine.

13.2    Set-off

        The  Borrower  authorises  each Bank  (without  prejudice to any of such
        Bank's rights at law, in equity or  otherwise),  at any time and without
        notice to the Borrower:

13.2.1  to apply any  credit  balance  to which the  Borrower  is then  entitled
        standing  upon any account of the Borrower  with any branch of such Bank
        in or towards  satisfaction of any sum due and payable from the Borrower
        to such Bank under any of the Security Documents;

13.2.2  in the name of the Borrower  and/or such Bank to do all such acts and to
        execute all such  documents  as may be  necessary or expedient to effect
        such application; and

13.2.3  to combine  and/or  consolidate  all or any  accounts in the name of the
        Borrower with such Bank.

        For this  purpose,  each such Bank is  authorised  to purchase  with the
        moneys  standing to the credit of such account such other  currencies as
        may be necessary to effect such application. No Bank shall be obliged to
        exercise  any right  given to it by this  clause  13.2.  Each Bank shall
        notify  the  Agent  and the  Borrower  forthwith  upon the  exercise  or
        purported  exercise  of any right of  set-off  giving  full  details  in
        relation thereto and the Agent shall inform the other Banks.

13.3    Pro-rata payments

        If at any time the proportion which any Bank (the "Recovering Bank") has
        received or recovered  (other than from an Assignee,  a Substitute  or a
        sub-participant  in such Bank's  Contribution or any other payment of an
        amount  due to the  Recovering  Bank for its sole  account  pursuant  to
        clauses 3.6, 4.3, 5.1, 6.1, 11.1,  11.2, 12.1 or 12.2) in respect of its
        share of any payment to be made for the account of the  Recovering  Bank
        and one or more  other  Banks  under any of the  Security  Documents  is
        greater (the amount of the excess being  referred to in this clause 13.3
        as the "excess amount") than the proportion of the share of such payment
        received or recovered by the Bank  receiving or recovering  the smallest
        or no proportion of its share, then:

13.3.1  within two (2) Banking Days of such receipt or recovery,  the Recovering
        Bank  shall  pay to the Agent an amount  equal  (or  equivalent)  to the
        excess amount;

13.3.2  the Agent shall treat such  payment as if it were part of the payment to
        be made by the Borrower and shall distribute the same in accordance with
        clause 13.1; and

13.3.3  as between the Borrower and the Recovering  Bank the excess amount shall
        be treated as not having been paid but the  obligations  of the Borrower
        to the other Banks  shall,  to the extent of the amount so paid to them,
        be treated as discharged.

        Each  Bank  shall  forthwith  notify  the Agent of any such  receipt  or
        recovery by such Bank other than by payment  through  the Agent.  If any
        excess amount  subsequently  has to be wholly or partly  refunded by the
        Recovering  Bank which paid an amount  equal  thereto to the Agent under
        (a) above  each Bank to which any part of such  amount  was  distributed
        shall on request from the Recovering  Bank repay to the Recovering  Bank
        such Bank's pro-rata share of the amount which has to be refunded by the
        Recovering  Bank.  Each Bank shall on  request  supply to the Agent such
        information  as the Agent may from time to time  request for the purpose
        of this clause 13.3.  Notwithstanding  the foregoing  provisions of this
        clause  13.3 no  Recovering  Bank  shall be  obliged to share any excess
        amount which it receives or recovers pursuant to legal proceedings taken
        by it to  recover  any sums owing to it under  this  Agreement  with any
        other  party  which has a legal  right to, but does not,  either join in
        such proceedings or commence and diligently pursue separate  proceedings
        to  enforce  its  rights  in the  same  or  another  court  (unless  the
        proceedings  instituted  by the  Recovering  Bank are  instituted  by it
        without prior notice having been given to such party through the Agent).

13.4    No release

        For the  avoidance  of doubt it is hereby  declared  that failure by any
        Recovering  Bank to comply with the  provisions of clause 13.3 shall not
        release  any  other  Recovering  Bank  from  any of its  obligations  or
        liabilities under clause 13.3.

13.5    No charge

        The  provisions  of this clause 13 shall not, and shall not be construed
        so as to,  constitute  a charge  by a Bank over all or any part of a sum
        received or  recovered  by it in the  circumstances  mentioned in clause
        13.3.

13.6    Further assurance

        The Borrower  undertakes  that the Security  Documents shall both at the
        date of  execution  and  delivery  thereof and so long as any moneys are
        owing  under  any  of  the  Security  Documents  be  valid  and  binding
        obligations  of the respective  parties  thereto and rights of the Agent
        enforceable in accordance with their  respective terms and that it will,
        at its  expense,  execute,  sign,  perfect and do, and will  procure the
        execution,  signing,  perfecting and doing by each of the other Security
        Parties of, any and every such further assurance, document, act or thing
        as in the reasonable opinion of the Agent and/or any other Finance Party
        may be necessary or desirable for perfecting  the security  contemplated
        or constituted by the Security Documents.

13.7    Conflicts

        In the event of any conflict between this Agreement and any of the other
        Borrower's  Security  Documents,  the provisions of this Agreement shall
        prevail.

14      Accounts

14.1    General

        The Borrower undertakes with each of the Finance Parties that it will:

14.1.1  on or before the first  Drawdown  Date open and procure  that each Owner
        will open each of the  Earnings  Accounts  and procure  that the Manager
        opens the Manager's Account;

14.1.2  on or before the first Drawdown Date open the Retention Account; and

14.1.3  procure  that all moneys  payable to the  Borrower  and/or the Owners in
        respect of the Earnings of the Ships  shall,  unless and until the Agent
        directs to the  contrary  pursuant  to proviso  (a) to clause 2.1 of the
        relevant Deed of Covenant or relevant General Assignment, be paid to the
        Earnings Accounts Provided however that if any of the moneys paid to the
        Earnings  Accounts  are payable in a currency  other than  Dollars,  the
        Borrower pay and shall  procure that the relevant  Owner shall  instruct
        the Account  Bank to convert  such  moneys  into  Dollars at the Account
        Bank's spot rate of exchange at the  relevant  time for the  purchase of
        Dollars with such  currency  and the term "spot rate of exchange"  shall
        include any premium and costs of exchange payable in connection with the
        purchase of Dollars with such currency;

14.2    Earnings Accounts terms

        The Banks acknowledge that the relevant Owner shall,  unless and until a
        Default  shall  occur and the Agent  shall  direct to the  contrary,  be
        entitled from time to time, subject to the agreement of the Account Bank
        to require that moneys for the time being  standing to the credit of the
        Earnings Accounts be transferred in such amounts and for such periods as
        the Borrower or relevant  Owner selects to fixed-term  deposit  accounts
        ("deposit  accounts")  opened in the name of the relevant Owner with the
        Account  Bank.  The  relevant  Owner shall not be  entitled  pursuant to
        clause 14.3 to withdraw  moneys  standing to the credit of the  Earnings
        Accounts  which are the subject of a fixed term deposit until the expiry
        of the  period of such  deposit  unless the  relevant  Owner  shall,  on
        withdrawing  such moneys pay to the  Account  Bank on demand any loss or
        expense  which the Account Bank shall  certify that it has  sustained or
        incurred as a result of such  withdrawal  being made prior to the expiry
        of the period of the  relevant  deposit  and the  Account  Bank shall be
        entitled  to debit the  Earnings  Accounts  for the amount so  certified
        prior to such  withdrawal  being  made.  In the event that any moneys so
        deposited  are to be applied  pursuant to clause  14.5,  the Borrower or
        relevant Owner shall, on such application being made, pay to the Account
        Bank on demand any loss or expense  which the Account Bank shall certify
        that it has sustained or incurred as a result of such application  being
        made prior to the expiry of the period of the  relevant  deposit and the
        Account  Bank shall be entitled to debit the relevant  Earnings  Account
        for the amount so certified  prior to such  application  being made. Any
        deposit accounts shall, for all the purposes of the Security  Documents,
        be deemed to be sub-accounts of Earnings  Accounts from which the moneys
        deposited in the deposit accounts were transferred and all references in
        the  Security  Documents  to the  Earnings  Accounts  shall be deemed to
        include the deposit  accounts  deemed as  aforesaid  to be  sub-accounts
        thereof.

14.3    Earnings Accounts: withdrawals

        Unless the  Majority  Banks  otherwise  agree in  writing,  neither  the
        Borrower  nor the Owners  shall be entitled to withdraw  any moneys from
        the Earnings  Accounts at any time during the Security Period save that,
        unless and until a Default shall occur and the Agent shall direct to the
        contrary,  the  Borrower  and each of the Owners may,  subject to clause
        14.2, withdraw moneys from the Earnings Accounts:

14.3.1  to transfer to the Retention  Account on each Retention Date all or part
        of the Retention Amount for such Retention Date;

14.3.2  to pay any amount to the Agent  and/or the other  Finance  Parties in or
        towards  payments of any  instalments  of interest or  principal  or any
        other amounts then payable pursuant to the Security Documents (including
        any amounts  owing to the Swap Banks  under the Master Swap  Agreements)
        and the Borrower hereby  irrevocably and  unconditionally  instructs the
        Account  Bank to make  such  payments  on  their  due date if and to the
        extent the Borrower does not issue the  appropriate  instructions  on or
        before such due date;

14.3.3  prior to the Delivery Date of a Ship to apply any sums  deposited to the
        relevant  Earnings  Account by the Agent as Expected  Project  Costs for
        such Ship in full and  final  payment  of such  Expected  Project  Costs
        subject  always  to the  relevant  Owner  applying  no more than the sum
        deposited to the relevant Earnings Account by the Agent;

14.3.4  following  the  Delivery  of a Ship to pay  the  proper  and  reasonable
        operating   expenses   (including  costs  of  insuring,   repairing  and
        maintaining  such  Ship) of such  Ship  and the  proper  and  reasonable
        expenses of administering the affairs of the relevant Owner;

14.3.5  to pay any Manager's  remuneration under any Management Agreement in the
        amounts and at the times therein stated;

14.3.6  to pay or discharge  liabilities  or  obligations  to third  parties not
        exceeding  the  aggregate of any  deductible  under a Ship's  insurances
        applicable  to such  liabilities  or  obligations  and the amount of any
        insurance  moneys in respect of such  liabilities or  obligations  which
        have been paid by such Ship's insurers to the relevant  Earnings Account
        with the knowledge and approval of the Agent;

14.3.7  to pay for the making good and/or repair of any loss or damage resulting
        from a casualty to a Ship not exceeding the aggregate of any  deductible
        under such Ship's insurances  applicable to such casualty and the amount
        of any insurance  moneys in respect of such casualty (not  exceeding the
        costs of making good  and/or  repairing  any such loss or damage)  which
        have been paid by such Ship's insurers to the relevant  Earnings Account
        with the knowledge and approval of the Agent; and

14.3.8  to pay any dividends to any of its shareholders to the extent that it is
        permitted to do so in accordance with the provisions of clause 8.3.12.

14.4    Retention Account terms

14.4.1  Subject to sub-clause 14.4.3, the Borrower undertakes with the Agent and
        the Finance Parties that it will, from the date of this Agreement and so
        long as any  moneys  are owing  under the  Security  Documents,  on each
        Retention  Date pay to the  Account  Bank for  credit  to the  Retention
        Account, the Retention Amount for such Retention Date.

14.4.2  In the  event  that,  at any time  prior to the date  falling  one month
        before  any  Reduction  Date,  the  Borrower  shall  draw down a further
        Advance or another Retention Event occurs,  the Borrower shall,  subject
        to sub-clause  14.4.3,  on each of the Retention  Dates  (following  the
        occurrence of the relevant Retention Event) up to and including the next
        following  Reduction  Date pay to the  Retention  Account  on a pro-rata
        basis such amount as when applied  against the Loan, will ensure that on
        the relevant Reduction Date the Loan does not exceed the Commitment.

14.4.3  To the  extent  that  there are  moneys  standing  to the  credit of the
        Earnings Accounts pursuant to sub-clauses 14.3.1 and/or 14.3.2 as at the
        relevant Retention Date, such moneys shall, up to the amount required to
        be  paid  pursuant  to  either  of  sub-clauses  14.3.1  or  14.3.2,  be
        transferred  to the Retention  Account on such  Retention  Date (and the
        Borrower hereby  instructs the Account Bank to effect such transfer) and
        to that extent the Borrower's  obligations to make the payments referred
        to in sub-clauses  14.3.1 and 14.3.2 shall have been fulfilled upon such
        transfer being effected.

14.4.4  Unless and until there shall  occur an Event of Default  (whereupon  the
        provisions of clause 14.6 shall apply),  all Retention  Amounts credited
        to the  Retention  Account  together  with  interest  from  time to time
        accruing or at any time accrued  thereon shall be applied by the Account
        Bank (and the Borrower hereby irrevocably and unconditionally  instructs
        the Account Bank so to apply the same) in the following manner:

        (a)     upon  each  Reduction  Date,  and on each day that  interest  is
                payable  pursuant to clause 3.1 whether in respect of an Advance
                or the Loan, in or towards payment to the Agent of that sum that
                may need to be repaid on the relevant  Reduction  Date to ensure
                that the Loan does not exceed the  Commitment on such  Reduction
                Date or (as the case may be) the  amount of  interest  then due.
                Each such  application  by the Account  Bank shall  constitute a
                payment   in  or   towards   satisfaction   of  the   Borrower's
                corresponding payment obligations under this Agreement but shall
                be strictly without prejudice to the obligations of the Borrower
                to make any  such  payment  to the  extent  that  the  aforesaid
                application  by the  Account  Bank is  insufficient  to meet the
                same; and

        (b)     following any application by the Account Bank pursuant to clause
                14.4.4(a)  in  transfer to the  Earnings  Accounts of any moneys
                standing  to the credit of the  Retention  Account to the extent
                that such  moneys do not  constitute  Retention  Amounts  or any
                payments received from the Swap Banks pursuant to the provisions
                of the Swap Assignment.

14.4.5  Unless  the Agent  otherwise  agrees in  writing  and  subject to clause
        14.4.4,  the Borrower  shall not be entitled to withdraw any moneys from
        the Retention Account at any time from the date of this Agreement and so
        long as any moneys are owing under the Security Documents.

14.5    Repayment under the Intra-Group Loan Agreements

        The  Borrower  acknowledges  and agrees that until such time as all sums
        due and  payable  under this  Agreement  and each of the other  Security
        Documents  have been  satisfied in full the  obligation of each Owner to
        pay all sums of principal  and interest and any other sums payable under
        the relevant  Intra-Group  Loan  Agreements  shall be fully satisfied by
        that Owner  depositing  the relevant  sums to the credit of its Earnings
        Account  and  the  Borrower  hereby   irrevocably  and   unconditionally
        acknowledges that all moneys from time to time standing to the credit of
        the  Earnings  Accounts  shall be  freely  available  to the  Agent  for
        application  in or towards  payment of any  instalments  of principal or
        interest  or any other  amounts  then due and  payable  pursuant to this
        Agreement and any of the other Security Documents.

14.6    Application of Accounts

        At any time  after  the  occurrence  of an Event of  Default,  the Agent
        and/or the Banks may instruct the Account  Bank,  without  notice to the
        Borrower  and/or the Owner,  to apply all moneys  then  standing  to the
        credit  of the  Accounts  (together  with  interest  from  time  to time
        accruing or accrued thereon) in payment to the Agent and the Agent shall
        apply the same in or towards satisfaction of any sums due to the Finance
        Parties under the Security  Documents in the manner  specified in clause
        13.1.

14.7    Security over account

        The Accounts  and all amounts  from time to time  standing to the credit
        thereof  shall be subject  to the  security  constituted  and the rights
        conferred by the Accounts Charges.

15      Assignment, substitution and lending office

15.1    Benefit and burden

        This Agreement  shall be binding upon, and enure for the benefit of, the
        Finance Parties, the Borrower and their respective successors.

15.2    No assignment by Borrower

        The Borrower may not assign or transfer any of its rights or obligations
        under this Agreement without the prior written consent of the Banks.

15.3    Assignment by Banks

        Each Bank may assign all or any part of its rights  subject to a minimum
        assignment amount of five million Dollars ($5,000,000) in respect of its
        Contribution  under this  Agreement  or under any of the other  Security
        Documents to any other bank or financial institution or to a trust, fund
        or other  entity which is regularly  engaged in or  established  for the
        purpose of making, purchasing or investing in liens, securities or other
        financial  assets (an "Assignee")  with the approval of the Agent (which
        consent shall not be unreasonably withheld or delayed) and subject to no
        Default  having  occurred,  the consent of the Borrower  (which  consent
        shall not be unreasonably withheld or delayed),  provided always that no
        such approval or consent shall be required where the Assignee shall be a
        Related  Company  of the  relevant  Bank,  the  Agent  and the  Borrower
        approving and consenting to such  arrangement by their execution of this
        Agreement.

15.4    Substitution

        Each  Bank  may  transfer,  by way of  novation,  all or any part of its
        rights,  benefits  and/or  obligations  under this  Agreement to another
        person  subject to a minimum  transfer  amount of five  million  Dollars
        ($5,000,000)  to be  transferred (a  "Substitute")  and provided that no
        Default has  occurred  and is  continuing  the  consent of the  Borrower
        (which consent shall not be unreasonably withheld or delayed).  Any such
        novation  shall be effected  upon five (5) Banking Days' prior notice by
        delivery to the Agent of a duly completed Substitution  Certificate duly
        executed by such Bank,  the  Substitute  and the Agent (for itself,  the
        Borrower and the other Banks) and following  receipt by the transferring
        Bank from the  Substitute of an amount equal to the purchase price to be
        paid by the Substitute for the Contribution  being  transferred.  On the
        effective date  specified in a Substitution  Certificate so executed and
        delivered,  to the extent that they are  expressed in such  Substitution
        Certificate to be the subject of the novation  effected pursuant to this
        clause 15.4:

15.4.1  the  existing  parties  to this  Agreement  and the  Bank  party  to the
        relevant   Substitution   Certificate   shall  be  released  from  their
        respective   obligations   towards  one  another  under  this  Agreement
        ("discharged  obligations")  and their  respective  rights  against  one
        another under this Agreement ("discharged rights") shall be cancelled;

15.4.2  the Substitute  party to the relevant  Substitution  Certificate and the
        existing  parties to this  Agreement  (other than the Bank party to such
        Substitution  Certificate) shall assume  obligations  towards each other
        which differ from the  discharged  obligations  only insofar as they are
        owed to or assumed by such Substitute instead of to or by such Bank; and

15.4.3  the Substitute  party to the relevant  Substitution  Certificate and the
        existing  parties to this  Agreement  (other than the Bank party to such
        Substitution  Certificate) shall acquire rights against each other which
        differ from the discharged  rights only insofar as they are  exercisable
        by or against such Substitute instead of by or against such Bank

        and, on the date upon which such novation  takes effect,  the Substitute
        shall  pay to the  Agent for its own  account  a  transfer  fee of three
        thousand  Dollars  ($3,000).  The Agent shall promptly  notify the other
        parties hereto of the receipt by it of any Substitution  Certificate and
        shall promptly  deliver a copy of such  Substitution  Certificate to the
        Borrower.

15.5    Reliance on Substitution Certificate

        The Agent, the Banks and the Borrower shall be fully entitled to rely on
        any Substitution  Certificate  delivered to the Agent in accordance with
        the foregoing provisions of this clause 15 which is complete and regular
        on its face as regards its contents and purportedly  signed on behalf of
        the  relevant  Bank and the  Substitute  and neither the Agent,  nor the
        Banks nor the Borrower shall have any liability or responsibility to any
        party as a consequence  of placing  reliance on and acting in accordance
        with any such Substitution  Certificate if it proves to be the case that
        the same was not authentic or duly authorised.

15.6    Signing of Substitution Certificate

        The Borrower and each of the Banks  irrevocably  authorise  the Agent to
        countersign  each  Substitution  Certificate  on its behalf  without any
        further consent of, or consultation  with, the Borrower or such Bank (as
        the case may be).

15.7    Construction of certain references

        If any Bank  assigns all or any part of its rights or novates all or any
        part of its rights,  benefits and obligations as provided in clause 15.3
        or 15.4 all  relevant  references  in this  Agreement to such Bank shall
        thereafter  be construed as a reference to such Bank and/or its Assignee
        or  Substitute  (as the case may be) to the  extent of their  respective
        interests. 15.8 Documenting assignments and novations

        If any Bank  assigns all or any part of its rights or novates all or any
        part of its rights,  benefits and/or  obligations as provided in clauses
        15.3 or 15.4 the Borrower undertakes,  immediately on being requested to
        do so by the Agent and at the cost of the Bank that has so  assigned  or
        novated all or any part of its rights and/or obligations, to enter into,
        and procure  that the other  Security  Parties  shall  enter into,  such
        documents  as may be  necessary or desirable to transfer to the Assignee
        or Substitute  all or the relevant  part of such Bank's  interest in the
        Security Documents and all relevant references in this Agreement to such
        Bank shall thereafter be construed as a reference to the Bank and/or its
        Assignee  or  Substitute  (as the  case may be) to the  extent  of their
        respective interests.

15.9    Lending office

        Each Bank shall lend  through  its office at the  address  specified  in
        Schedule  1 or,  as  the  case  may  be,  in any  relevant  Substitution
        Certificate  or through any other office of such Bank selected from time
        to time by it through which such Bank wishes to lend for the purposes of
        this  Agreement  Provided  always that such  change of office  shall not
        result in an increase in the  obligations  of the Borrower  under clause
        6.7.  If the  office  through  which  such Bank is  lending  is  changed
        pursuant to this clause 15.9,  such Bank shall notify the Agent promptly
        of such change and the Agent shall notify the Banks and the Borrower.

15.10   Disclosure of information

        Any Bank or the Agent may, with the prior consent of the Borrower  which
        shall not be unreasonably withheld,  disclose to a prospective assignee,
        substitute or transferee or to any other person who may propose entering
        into  contractual  relations  with such Bank or the Agent in relation to
        this Agreement information about the Borrower.

16      Agent

16.1    Appointment of the Agent

        The terms and basis on which the Agent has been  appointed  by the Banks
        as facility agent and as security agent and trustee respectively are set
        out in the Agency Agreement including, among other things, the manner in
        which  any  decision  to  exercise  any  right,  powers,  discretion  or
        authority  or to carry out any duty are to be made between the Banks and
        the Agent.

17      Notices and other matters

17.1    Notices

        Every  notice,   request,  demand  or  other  communication  under  this
        Agreement or (unless otherwise  provided therein) under any of the other
        Security Documents shall:

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

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

17.1.3  be sent:

        (a)     to the Borrower and any Owner at:

                Aries Maritime Transport Limited
                C/O AMT Management Ltd.
                18 Zerva Nap, 1st Floor,
                Athens 16675
                Greece

                Fax no:     +30 210 89 83 788
                Attention:  Mans Bolin, Chief Executive Officer

        (b)     to the Agent and/or the Banks at:

                The Governor and Company of the Bank of Scotland
                New Uberior House
                11 Earl Grey Street
                Edinburgh EH3 9BN
                Scotland

                Fax No:    +44 131 659 0387
                Attention: Marine Finance

        (c)     to the Arrangers at:

                The Governor and Company of the Bank of Scotland
                New Uberior House
                11 Earl Grey Street
                Edinburgh EH3 9BN
                Scotland

                Fax No:    +44 131 659 0387
                Attention: Marine Finance

                Nordea Bank Finland plc, London Branch
                8th Floor
                City Place House
                55 Basinghall Street
                London EC2V 5NB
                England

                Fax No:    +44 207 726 9188
                Attention: Shipping, Offshore & Oil Services

        (d)     to the Swap Banks at:

                Nordea Bank Finland plc, London Branch
                8th Floor
                City Place House
                55 Basinghall Street
                London EC2V 5NB
                England

                Fax No:    +44 207 726 9188
                Attention: Shipping, Offshore & Oil Services

                HBOS Treasury Services plc
                33 Old Broad Street
                London EC2N 1HZ

                Fax No: +44 207 574 8133
                Attention: Managing Director

                The Governor and Company of Bank of Scotland
                New Uberior House
                11 Earl Grey Street
                Edinburgh EH3 9BN
                Scotland

                Fax No:    +44 131 659 0387
                Attention: Marine Finance

                Bank of Ireland
                La Touche House
                4th floor
                Dublin 1

                Fax No:    +353 1 611 5379
                Attention: John Hartigan

                HSH Nordbank AG
                Gerhart - Hauptmann-Platz 50
                20095 Hamburg
                Germany

                Fax No:    +49 40 3333 34118
                Attention: Shipping, Greek Clients

                SMBC Capital Markets, Inc.
                277 Park Avenue, 5th Floor
                New York
                NY 10172
                USA

                Fax No: +1 212 224 4948
                Attention: President

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

17.2    No implied waivers, remedies cumulative

        No failure  or delay on the part of the Agent,  the Banks or any of them
        to  exercise  any  power,  right or  remedy  under  any of the  Security
        Documents  shall  operate as a waiver  thereof,  nor shall any single or
        partial  exercise  by the Agent,  the Banks or any of them of any power,
        right or remedy  preclude any other or further  exercise  thereof or the
        exercise of any other power,  right or remedy.  The remedies provided in
        the  Security  Documents  are  cumulative  and are not  exclusive of any
        remedies provided by law.

17.3    English language

        All certificates,  instruments and other documents to be delivered under
        or supplied in connection with any of the Security Documents shall be in
        the English  language  or shall be  accompanied  by a certified  English
        translation upon which the Bank shall be entitled to rely.

17.4    Counterparts

        This Agreement may be entered into in any number of counterparts  and by
        the parties to it on separate counterparts,  each of which when executed
        and  delivered  shall be an  original,  but all the  counterparts  shall
        together constitute one and the same instrument.

18      Governing law and jurisdiction

18.1    Law

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

18.2    Submission to jurisdiction

        The Borrower  agrees,  for the benefit of the Agent and the Banks,  that
        any legal action or  proceedings  arising out of or in  connection  with
        this Agreement  against the Borrower or any of its assets may be brought
        in the English  courts.  The Borrower  irrevocably  and  unconditionally
        submits to the  jurisdiction of such courts and irrevocably  designates,
        appoints  and  empowers  Seabreeze  (UK)  Limited  at present of Hampton
        House, 20 Albert  Embankment,  London SE1 7TJ, England to receive for it
        and on its behalf,  service of process  issued out of the English courts
        in any  such  legal  action  or  proceedings.  The  submission  to  such
        jurisdiction  shall not (and shall not be  construed so as to) limit the
        right of the Agent  and/or  the Banks to take  proceedings  against  the
        Borrower in the courts of any other competent jurisdiction nor shall the
        taking of  proceedings  in any one or more  jurisdictions  preclude  the
        taking of proceedings in any other jurisdiction, whether concurrently or
        not.

        The parties  further agree that only the Courts of England and not those
        of any other State shall have  jurisdiction to determine any claim which
        the  Borrower  may have  against  the  Agent,  the  Banks or any of them
        arising out of or in connection with this Agreement.

IN WITNESS  whereof the parties to this  Agreement have caused this Agreement to
be duly executed on the date first above written


<PAGE>

Schedule 1

                    Part 1 - The Banks and their Commitments

Name                          Address and fax                     Commitment ($)
----                          ---------------                     --------------

The Governor and Company of   New Uberior House                      $50,000,000
the Bank of Scotland          11 Earl Grey Street
                              Edinburgh EH3 9BN
                              Scotland

                              Fax:  +44 131 659 0387

Nordea Bank Finland plc,      8th Floor                              $50,000,000
London Branch                 City Place House
                              55 Basinghall Street
                              London EC2V 5HB
                              England

                              Fax:  +44 207 726 9188

HSH Nordbank AG               HSH Nordbank AG                        $40,000,000
                              Gerhart - Hauptmann-Platz 50
                              20095 Hamburg
                              Germany

                              Fax:  +49 40 3333 34118

The Governor and Company of   Lower Baggot Street                    $35,000,000
the Bank of Ireland           Dublin 2
                              Ireland

                              Fax: +353 1 611 5411
                              Att:  John Hartigan

Sumitomo Mitsui Banking       Avenue des Arts 58                     $35,000,000
Corporation, Brussels Branch  Box 18
                              1000 Brussels, Belgium

                              Fax: +44 (0)207 786 1569
                              Att: European Loan Operations

                              Email:lesley_kelly@gb.smbcgroup.com,
                              ainsley_bastick@gb.smbcgroup.com

                              with copy to
                              Fax: +32 2 5131601
                              Att: Jean-Luc Renard
                              Email:
                              jean-luc_renard@be.smbcgroup.com

Bayerische Hypo- und          Kardinal-Faulhaber-Str.1               $30,000,000
Vereinsbank AG                80311 Munchen acting through
                              its office at
                              Alter Wall 22
                              20457
                              Hamburg

                              Fax: +49 40 3692 3696

Commerzbank                   Hamburg Branch                         $30,000,000
Aktiengesellschaft            Ness  7-9,
                              D-20457 Hamburg
                              Germany

                              Fax:  +49 (0)40 3683 2049
                              Att:  Bjorn Brandmahl
                              Email:
                              bjoern.brandmaehl@commerzbank.com

General Electric Capital      c/o GE Transportation Finance          $30,000,000
Corporation                   201 High Ridge Road
                              Stamford
                              Connecticut 06927
                              USA

                              Fax: +1 203 585 0597

Natexis Banques Populaires    45, rue Saint Dominique                $30,000,000
                              75007 Paris
                              France

                              Fax: +33 1 58 19 36 60
                              Att:
                              David Bonicel/Michel Degermann
                              Email: david.bonicel@nxbp.fr/
                              michel.degermann@nxbp.fr


Swedbank                      Brunkebergstorg 8                      $30,000,000
(Foreningssparbanken AB       Swedbank Shipping E421
(Publ))                       SE-105 34  Stockholm
                              Sweden

                              Fax: +46 8 723 7150
                              Att:  Dagobert
                              Billsten and/or Karin Nilsson
                              Email:
                              dagobert.billsten@swedbank.com,
                              karin.nilsson@swedbank


TOTAL                                                               $360,000,000


<PAGE>


                             Part 2 - The Swap Banks


Name                          Address and fax
----                          ---------------

The Governor and Company      New Uberior House
of the Bank of Scotland       11 Earl Grey Street
                              Edinburgh EH3 9BN
                              Scotland

                              Fax:  +44 131 659 0387

HBOS Treasury Services plc    33 Old Broad Street
                              London
                              EC2N 1HZ

                              Fax:  +44 20 7574 8133

Nordea Bank Finland plc,      8th Floor
London Branch                 City Place House
                              55 Basinghall Street
                              London EC2V 5HB
                              England

                              Fax:  +44 207 726 9188

The Governor and Company      Lower Baggot Street
of the Bank of Ireland        Dublin 2
                              Ireland

                              Fax: +353 1 604 4796
                              Att:   Ann Marie Dodd
                              Email: annmarie.dodd@boimail.com

HSH Nordbank AG               HSH Nordbank AG
                              Gerhart - Hauptmann-Platz 50
                              20095 Hamburg
                              Germany

                              Fax: +49 40 3333 34118

SMBC Capital Markets, Inc.    277 Park Avenue, 5th Floor
                              New York
                              NY 10172
                              USA

                              Fax : +1 212 224 4948


<PAGE>


                            Part 3 - The Co-Arrangers



Name                           Address and fax

The Governor and Company       Lower Baggot Street
of the Bank of Ireland         Dublin 2
                               Ireland

                               Fax: +353 1 604 4796
                               Att:   Ann Marie Dodd
                               Email: annmarie.dodd@boimail.com


HSH Nordbank AG                HSH Nordbank AG
                               Gerhart - Hauptmann-Platz 50
                               20095 Hamburg
                               Germany

                               Fax: +49 40 3333 34118


Sumitomo Mitsui Banking        Avenue des Arts 58
Corporation, Brussels Branch   Box 18
                               1000 Brussels, Belgium

                               Fax:  +44 (0)207 786 1569
                               Att:  European Loan Operations
                               Email:
                               lesley_kelly@gb.smbcgroup.com,
                               ainsley_bastick@gb.smbcgroup.com

                               with copy to
                               Fax:  +32 2 5131601
                               Att:  Jean-Luc Renard
                               Email:jean-luc_renard@ be.smbcgroup.com



<PAGE>



Schedule 2
<TABLE>

                             Part 1 - Initial Ships
<CAPTION>

                                                                                                                   Country
                                                      Country of                                    Official     of Underlying
Ship                 Owner                            Incorporation of Owner    Flag                 Number      Registration
----                 -----                            ----------------------    ----                 ------      ------------
<S>                  <C>                              <C>                       <C>                  <C>         <C>
"BORA"               Bora Limited                     British Virgin Islands    Venezuela             1878        Marshall Islands

"NORDANVIND"         Ermina Marine Limited            Marshall Islands          Venezuela             1879        Marshall Islands

"CITIUS"             Vintage Marine S.A.              Marshall Islands          Marshall Islands      2129        N/A

"HIGH LAND"          Land Marine S.A.                 Marshall Islands          Marshall Islands      2396        N/A

"HIGH RIDER"         Rider Marine S.A.                Marshall Islands          Marshall Islands      2397        N/A

"ALTIUS"             Altius Marine S.A.               Marshall Islands          Marshall Islands      2394        N/A

"FORTIUS"            Fortius Marine S.A.              Marshall Islands          Marshall Islands      2395        N/A

"OCEAN HOPE"         Jubilee Shipholding S.A.         Marshall Islands          Marshall Islands      2128        N/A

"ANL ENERGY"         Olympic Galaxy Shipping Limited  Marshall Islands          Marshall Islands      2062        N/A

"CMA CGM FORCE"      Dynamic Maritime Company         Marshall Islands          Marshall Islands      2065        N/A

"CMA CGM MAKASSAR"   Makassar Marine Ltd.             Marshall Islands          Marshall Islands      2392        N/A

"CMA CGM SEINE"      Seine Marine Ltd.                Marshall Islands          Marshall Islands      2391        N/A

"CHINOOK"            Chinook Waves Corporation        Marshall Islands          Marshall Islands      2490        N/A

"STENA COMPASS"      Compass Overseas Ltd.                  Bermuda                 Bermuda           733757      N/A

"STENA COMPASSION"   Compassion Overseas Ltd.               Bermuda                 Bermuda                       N/A

</TABLE>

<TABLE>

                                                            Ship           Year
Ship                 Classification                         Type           Built    Deadweight/TEU        Charterer
----                 --------------                         ----           -----    --------------        ---------
<S>                  <C>                                    <C>            <C>      <C>                   <C>
"BORA"                > HULL, MACH, FLS TANKER ESP          Tanker         2000     38,701 dwt            PDVSA Petroleo S.A
                        Unrestricted Navigation

"NORDANVIND"          > HULL,                               Tanker         2001     38,701 dwt            PDVSA Petroleo S.A.
                      > MACH, OIL TANKER, ESP
                        Unrestricted Navigation

"CITIUS"              > HULL,                               Tanker         1986     83,970 dwt            ST Shipping and
                      > MACH, OIL TANKER, ESP                                                             Transportation Inc.
                        Unrestricted Navigation
                      > AUT-UMS, IG

"HIGH LAND"           NS (tanker, Oils-Flashpoint below     Tanker         1992     41,450 dwt            D'Amico Tankers Limited
                      60(Degree)C) (ESP) MNS*

"HIGH RIDER"          NS (tanker, Oils-Flashpoint below     Tanker         1991     41,502 dwt            D'Amico Tankers Limited
                      60(Degree)C) (ESP) MNS*

"ALTIUS"             I> HULL,                               Tanker         2004     73,400 dwt            Deiulemar-Compagnia de
                      > MACH, OIL TANKER, ESP                                                             Navigazione S.p.A/ENE2
                        Unrestricted Navigation
                      > AUT-UMS, IG >  AUT-PORT

"FORTIUS"             I> HULL,                              Tanker         2004     73,400 dwt            Deiulemar-Compagnia de
                      > MACH, OIL TANKER, ESP                                                             Navigazione S.p.A/ENE2
                        Navigazione
                      > AUT-UMS, IG
                      > AUT-PORT; VCS

"OCEAN HOPE"          > HULL,                               Container      1989     1,799 TEU             China Shipping Container
                      > MACH, FLS TANKER, ESP                                                              Lines (Asia) Co. Limited
                        Unrestricted Navigation
                      > AUT-PORT

"ANL ENERGY"          *100-A-1.1 Nav IL; T Cont             Container      1989     2,438 TEU             CMA CGM S.A.
                      > IAP;
                      > IAQ-1

"CMA CGM FORCE"       I> HULL,                              Container      1989     2,438 TEU             CMA CGM S.A.
                      > MACH, Container Ship,
                        Unrestricted Navigation
                      > AUT-PORT; VCS

"CMA CGM MAKASSAR"    100 A1 CONTAINER SHIP LMC UMS SCM     Container      1990     2,917 TEU             CMA CGM S.A.

"CMA CGM SEINE"       100 A1 CONTAINER SHIP LMC UMS SCM     Container      1990     2,917 TEU             CMA CGM S.A.

"CHINOOK"             Hull: > 100 A5 ESP, ERS, NLS, T3D21,  Tanker         2001     38,701 dwt            PDVSA
                        Oil Tanker with Double Hull
                        Machinery:
                      > MC INERT

"STENA COMPASS"       > 1A1 Tanker for Oil ESP E0 VCS-2,    Tanker         2006     72,750 dwt            Panvision Ltd
                        TMON Nauticus                                                                     (Stena Group)
                        (Newbuilding)

"STENA COMPASSION"                                          Tanker         2006     72,750 dwt            Panvictory Ltd
                                                                                                          (Stena Group)

</TABLE>


<PAGE>


                   Part 2 - Additional Ship Selection Criteria


(A)     Each Additional Ship shall:

1       be a double  hull  crude  oil or double  hull  product  oil  tanker or a
        container ship;

2       be aged 8 years or less on the relevant Delivery Date, or such other age
        as may be agreed by the Majority Banks;

3       maintain a flag and class acceptable to the Majority Banks;

4       be wholly owned by the Borrower or an Additional Owner; and

5       have a purchase  price which shall not exceed the Fair Market  Value for
        such Additional Ship.

(B)     The Majority Banks shall be satisfied that the Borrower shall be able to
        procure  that  such  Additional  Ship  shall be  subject  to  Acceptable
        Employment within six (6) months after the Drawdown Date relative to the
        Advance relating to such Additional Ship.

                       Part 3 - Maximum amount of Advance

   Initial Ships                                         Maximum Amount
   -------------                                         --------------
                                                                $

"BORA"                                                     11,220,096
"NORDANVIND"                                               11,889,953
"HIGH LAND"                                                 9,043,061
"HIGH RIDER"                                                8,708,134
"ALTIUS"                                                   17,332,536
"FORTIUS"                                                  17,332,536
"CITIUS"                                                    7,200,957
"OCEAN HOPE"                                                8,373,206
"ANL ENERGY"                                               10,885,167
"CMA CGM FORCE"                                            10,885,167
"CMA CGM MAKASSAR"                                         13,564,593
"CMA CGM SEINE"                                            13,564,593
"CHINOOK"                                                  32,600,000
"STENA COMPASS"                                            56,100,000
"STENA COMPASSION"                                          5,610,000
                                                         ------------
                                                         $234,309,999



<PAGE>

<TABLE>

                       Part 4 - Details of Initial Owners
<CAPTION>

Initial Owner                      Country of Incorporation          Address                                             Shareholder
-------------                      ------------------------          -------                                             -----------
<S>                                <C>                       <C>                                                            <C>
Bora Limited                       British Virgin Islands    Road Town, Tortola, British Virgin Islands                     Borrower

                                                             Registered agent:

                                                             Mossack Fonseca & Co. (B.V.I.) Ltd.
                                                             Akara  Building,  24 De Castro Street,  Wickhams Cay
                                                             1, Road Town, Tortola, British Virgin Islands

Ermina Marine Limited              Marshall Islands          Trust  Company  Complex,   Ajeltake  Road,  Ajeltake           Borrower
                                                             Island, Majuro MH 96960, Marshall Islands


Vintage Marine S.A.                Marshall Islands          Trust  Company  Complex,   Ajeltake  Road,  Ajeltake           Borrower
                                                             Island, Majuro MH 96960, Marshall Islands

Land Marine S.A.                   Marshall Islands          Trust  Company  Complex,   Ajeltake  Road,  Ajeltake           Borrower
                                                             Island, Majuro MH 96960, Marshall Islands

Rider Marine S.A.                  Marshall Islands          Trust  Company  Complex,   Ajeltake  Road,  Ajeltake           Borrower
                                                             Island, Majuro MH 96960, Marshall Islands

Altius Marine S.A.                 Marshall Islands          Trust  Company  Complex,   Ajeltake  Road,  Ajeltake           Borrower
                                                             Island, Majuro MH 96960, Marshall Islands

Fortius Marine S.A.                Marshall Islands          Trust  Company  Complex,   Ajeltake  Road,  Ajeltake           Borrower
                                                             Island, Majuro MH 96960, Marshall Islands

Jubilee Shipholding S.A.           Marshall Islands          Trust  Company  Complex,   Ajeltake  Road,  Ajeltake           Borrower
                                                             Island, Majuro MH 96960, Marshall Islands

Olympic Galaxy Shipping Limited    Marshall Islands          Trust  Company  Complex,   Ajeltake  Road,  Ajeltake           Borrower
                                                             Island, Majuro MH 96960, Marshall Islands

Dynamic Maritime Company           Marshall Islands          Trust  Company  Complex,   Ajeltake  Road,  Ajeltake           Borrower
                                                             Island, Majuro MH 96960, Marshall Islands

Makassar Marine Ltd.               Marshall Islands          Trust  Company  Complex,   Ajeltake  Road,  Ajeltake           Borrower
                                                             Island, Majuro MH 96960, Marshall Islands

Seine Marine Ltd.                  Marshall Islands          Trust  Company  Complex,   Ajeltake  Road,  Ajeltake           Borrower
                                                             Island, Majuro MH 96960, Marshall Islands

Chinook Waves Corporation          Marshall Islands          Trust  Company  Complex,   Ajeltake  Road,  Ajeltake           Borrower
                                                             Island, Majuro MH 96960, Marshall Islands
Compass Overseas Ltd.              Bermuda                   Canon's Court,  22 Victoria  Street,  Hamilton HM12,           Borrower
                                                             Bermuda

Compassion Overseas Ltd.           Bermuda                   Canon's Court,  22 Victoria  Street,  Hamilton HM12,           Borrower
                                                             Bermuda
</TABLE>


<PAGE>



                                   Schedule 3
                             Form of Drawdown Notice
                            (referred to in clause 9)

To:    The Governor and Company of Bank of Scotland
       New Uberior House
       11 Earl Grey Street
       Edinburgh EH3 9BN


                                                                   [Date] 200o

              Facilities Agreement dated [o] 2006 (the "Agreement")

We refer to the above  Agreement and hereby give you notice that we wish to draw
down the sum of [o] [$(o)] representing:

        Advance[s] of the Facility [being for general corporate purposes]

        [the Contract Instalment Advance payable at [stage]];

        [the Delivery Date Advance];

        [Expected Project Costs]

on {date} [and select a first  Interest  Period in respect  thereof of o months]
[the first Interest  Period in respect  thereof to expire  on{date}].  The funds
should be credited to [name and number of account] with [details of bank.]

We confirm that:

        (a)     no event or  circumstance  has occurred and is continuing  which
                constitutes a Default;

        (b)     the representations and warranties contained in:

                (i)     clauses 7.1, 7.2 and 7.3 of the Agreement; and

                (ii)    clauses 4.1 and 4.2 of the Owners' Guarantees;

                are true and correct at the date hereof as if made with  respect
                to the facts and  circumstances  existing at such date [and that
                the  aggregate  of all  Advances  relative to general  corporate
                purposes does not exceed $5,000,000];

        (c)     the borrowing to be effected by the drawdown of the Advance will
                be within  our  corporate  powers,  will not  result in the Loan
                exceeding  the  Commitment,   has  been  validly  authorised  by
                appropriate corporate action and will not cause any limit on our
                borrowings (whether imposed by statute, regulation, agreement or
                otherwise) to be exceeded; and

        (d)     there  has been no  material  adverse  change  in our  financial
                position from that described by us to the Finance Parties in the
                negotiation of the Agreement.

Words and  expressions  defined in the  Agreement  shall have the same  meanings
where used herein.

                              For and on behalf of
                      ....................................
                        ARIES MARITIME TRANSPORT LIMITED

<PAGE>

Schedule 4


                                     Part 1
    Documents and evidence required as conditions precedent to the Commitment


                          (referred to in clause 9.1.1)

(a)     Constitutional documents

        copies, certified by an officer of each Security Party as true, complete
        and up to date copies of all  documents  which  contain or  establish or
        relate to the constitution of that Security Party;

(b)     Corporate authorisations

        copies of resolutions of the directors and shareholders of each Security
        Party  approving  such of the  Underlying  Documents  and  the  Security
        Documents  to which  such  Security  Party  is,  or is to be,  party and
        authorising  the  signature,  delivery and  performance of such Security
        Party's  obligations  thereunder,  certified (in a certificate  dated no
        earlier than five (5) Banking Days prior to the date of this  Agreement)
        by an officer of such Security Party;

        (i)     being true and correct;

        (ii)    being duly passed at meetings of the  directors of such Security
                Party and of the  shareholders  of such Security Party each duly
                convened and held;

        (iii)   not having been amended, modified or revoked; and

        (iv)    being in full force and effect

        together  with  originals or certified  copies of any powers of attorney
        issued by any Security Party pursuant to such resolutions;

(c)     Specimen signatures

        copies of the  signatures  of the  persons who have been  authorised  on
        behalf of each Security Party to sign such of the  Underlying  Documents
        and the Security Documents to which such Security Party is, or is to be,
        party and to give  notices  and  communications,  including  notices  of
        drawing,  under or in connection with the Security Documents,  certified
        (in a  certificate  dated no earlier than five (5) Banking Days prior to
        the date of this  Agreement)  by an  officer of such  Security  Party as
        being the true signatures of such persons;

(d)     Certificates of incumbency

        a list of directors and officers of each Security  Party  specifying the
        names and positions of such persons,  certified (in a certificate  dated
        no  earlier  than  five  (5)  Banking  Days  prior  to the  date of this
        Agreement) by an officer of such Security Party to be true, complete and
        up to date;

(e)     Know your customer and money laundering compliance

        such  documents  and evidence as the Banks shall require to identify the
        Borrower and the other Security  Parties and any other persons  involved
        or affected by the  transaction(s)  contemplated  by this  Agreement  as
        required by any  applicable  law or the Banks' own "know your  customer"
        internal guidelines; and

(f)     Fees, commissions and expenses

        evidence that any fees and commission due from the Borrower  pursuant to
        the terms of clause 5.1 or any other provision of the Security Documents
        and all expenses under clause 5.2 have been paid in full.


<PAGE>


                                     Part 2

  Documents and evidence required as conditions precedent to the first Advance

                           (referred to in clause 9.1)

(a)     Conditions precedent

        evidence that the  conditions  precedent set out in Part 1 of Schedule 4
        remain fully satisfied;

(b)     Borrower's consents and approvals

        a  confirmation  from the  Borrower  that no  consents,  authorisations,
        licences and  approvals are  necessary in any Relevant  Jurisdiction  to
        enable it to borrow the Loan and to perform its  obligations  under this
        Agreement and each of the other Security  Documents and evidence in form
        and  substance  satisfactory  to the  Arrangers  that  the  Borrower  is
        properly  and  validly  registered  on  NASDAQ  and that  all  necessary
        consents and approvals whether of a governmental nature or otherwise for
        the  borrowing of the Loan under this  Agreement  have been obtained and
        remain in full force and effect;

(c)     No judgments etc

        evidence in form and substance  satisfactory to the Agent that there are
        no judgments,  orders, injunctions or restraints of any kind prohibiting
        or  imposing  materially  adverse  conditions  on the  borrowing  by the
        Borrower of the Loan under this Agreement;

(d)     No litigation or other event

        evidence in form and substance  satisfactory to the Arrangers that there
        is no event or  existing  or  threatened  litigation  by any person with
        respect or to the transactions contemplated by the Security Documents or
        which  the  Arrangers  shall  in  their  sole  discretion  determine  is
        reasonably   likely  to  have  a  materially   adverse   effect  on  the
        registration  of the  Borrower on NASDAQ or on the  business,  property,
        assets,  liabilities,  financial  condition or otherwise or prospects of
        the Borrower or of the Borrower's Group taken as a whole,  either before
        or after  giving  effect  to the  consummation  of such  initial  public
        offering;

(e)     Other consents and approvals

        a confirmation from each of the other Security Parties that no consents,
        authorisations,  licences and  approvals  are  necessary in any Relevant
        Jurisdiction  to enable that Security Party to enter into and to perform
        its obligations under the Security Documents to which it is a party;

(f)     Certified Underlying Documents

        a copy,  certified  (in a  certificate  dated no  earlier  than five (5)
        Banking Days prior to the date of this Agreement) as a true and complete
        copy by an officer of the Borrower of each of the Underlying Documents;

(g)     Security Documents

        all relevant Security  Documents (as determined by the Agent in its sole
        discretion) including,  without limitation,  the Master Swap Agreements,
        duly executed;

(h)     Legal opinions

        (i)     Bermuda opinion

                an opinion of Conyers Dill & Pearman  special legal  advisers to
                the Agent dated no earlier  than  fifteen (15) days prior to the
                date of this Agreement;

        (ii)    Owner(s)' opinion

                an  opinion  of the  Agent's  special  legal  advisers  in  each
                Relevant  Jurisdiction  with respect to the relevant Owner dated
                no  earlier  than  fifteen  (15) days  prior to the date of this
                Agreement;

        (iii)   New York opinion

                an opinion of Healy & Baillie LLP special legal  advisers to the
                Agent in New York dated no later than fifteen (15) days prior to
                the date of this Agreement;

        (iv)    English law opinion

                an opinion of Norton Rose special legal advisers to the Agent as
                to matters of the laws of England  dated no earlier than fifteen
                (15) days prior to the date of this Agreement;

        (v)     Further opinions

                any such further  opinion as may be required by the Agent and/or
                the Banks;

(i)     Borrower's process agent

        a copy,  certified as a true copy by the Borrower's  solicitors or other
        person acceptable to the Agent of a letter from the Borrower's agent for
        receipt of service of  proceedings  referred to in clause 18.2 accepting
        its  appointment  under  the said  clause  and  under  each of the other
        Security  Documents  in  which  it  is or is  to  be  appointed  as  the
        Borrower's agent;

(j)     Owner's process agent

        a copy,  certified as a true copy by the Borrower's  solicitors or other
        person  acceptable  to the  Agent of a letter  from the  Owner's  or the
        Security Party's agent for receipt of service of proceedings referred to
        in,  inter  alia,  clause 9.2 of the  Owner's  Guarantee  accepting  its
        appointment  under the said clause and under each of the other  Security
        Documents  in which it is or is to be  appointed  as the  Owner's or the
        Security Party's agent;

(k)     Indebtedness of the Borrower's Group

        evidence  in form and  substance  satisfactory  to the  Arrangers  that,
        following  the  borrowing  of  the  Loan  by  the  Borrower  under  this
        Agreement,  there shall be no outstanding Indebtedness in respect of the
        Borrower's  Group,  except for Borrowed  Money  pursuant to the Security
        Documents;

(l)     Parent company

        evidence in form and substance  satisfactory  to the Arrangers that each
        Owner is a wholly-owned Subsidiary of the Borrower and that the Borrower
        and each Owner and their  respective  assets are free of any Encumbrance
        except for Permitted Encumbrances;

(m)     Valuations

        copies,  certified by an officer of the Borrower,  of valuations of each
        relevant  Ship  dated no  earlier  than  fifteen  (15) days prior to the
        Drawdown Date of the first Advance  setting out the Fair Market Value of
        each relevant Ship,  such  valuations to be conducted in accordance with
        clause 8.2.2 and each  valuation to be in form and substance  acceptable
        to the Arrangers;

(n)     Solvency certificate

        The Arrangers shall have received a solvency  certificate  signed by the
        Chief Financial  Officer of the Borrower and certified as correct by the
        Borrower's  auditor (such  auditor to be  acceptable to the  Arrangers),
        such solvency  certificate  to be in a form and substance  acceptable to
        the Arrangers and  certifying  that  following the borrowing of the Loan
        under  this   Agreement  and  incurring  all  of  the  other   financial
        accommodation  that the Borrower shall incur,  that individually and the
        Borrower's Group on a consolidated  basis are not insolvent and will not
        be rendered  insolvent by the  Indebtedness  incurred in connection with
        such  transactions  and the Borrower and the Borrower's  Group will have
        sufficient  Free Liquid Assets to utilise as working  capital to pay the
        debts of the Borrower and the Borrower's Group as and when they fall due
        (on the  basis  that the  Fleet  Market  Value  shall  not be less  than
        $360,000,000);

(o)     No Default under any material agreement

        evidence in form and substance satisfactory to the Arrangers that, after
        the  borrowing  of the Loan  under  this  Agreement,  there  shall be no
        Default under any Security  Document,  Underlying  Document or any other
        material agreement of the Borrower's Group;

(p)     Accounts

        evidence that the Accounts have been opened with the Account Bank; and

(q)     Fees, commissions and expenses

        evidence that any fees and commission due from the Borrower  pursuant to
        the terms of clause 5.1 or any other provision of the Security Documents
        and all expenses under clause 5.2 have been paid in full.


<PAGE>


                                     Part 3

                 Documents and evidence required as a condition
                      precedent to all Advances being made
                                  (clause 9.1)

(a)     Conditions precedent

        evidence that the  conditions  precedent set out in Part 1 and Part 2 of
        Schedule 4, remain fully satisfied;

(b)     No claim

        if an Additional  Ship is a newbuilding,  evidence  satisfactory  to the
        Agent  and/or the Banks that the  relevant  Builder (and any other party
        who may have a claim  pursuant to the relevant  Contract)  has no claims
        against such  Additional Ship or the Borrower or relevant Owner and that
        there have been no breaches of the terms of the relevant Contract or the
        Refund Guarantee or any default thereunder;

(c)     No variations to Contract

        if an Additional Ship is a newbuilding, evidence that there have been no
        amendments  or  variations  agreed to the relevant  Contract and that no
        action  has  been  taken  by the  Borrower;  the  relevant  Owner or the
        relevant  Builder  which might in any way render the  relevant  Contract
        inoperative or unenforceable, in whole or in part;

(d)     No Encumbrance

        if an  Additional  Ship is a  newbuilding,  evidence  that  there  is no
        Encumbrance  of any  kind  created  or  permitted  by any  person  on or
        relating to the relevant Contract other than a Permitted Encumbrance;

(e)     Ship conditions

        evidence that the Ship for which the relevant Advance is to be made:

        (i)     Registration and Encumbrances

                is registered in the name of the Borrower or the relevant  Owner
                through  the  relevant  Registry  under the laws and flag of the
                relevant  Flag  State  and  that  such  Ship  and its  Earnings,
                Insurances  and  Requisition  Compensation  (as  defined  in the
                relevant Ship Security Document) are free of Encumbrances;

        (ii)    Classification

                maintains  the   Classification   for  such  Ship  free  of  all
                requirements and recommendations of the relevant  Classification
                Society; and

        (iii)   Insurance

                is insured in  accordance  with the  provisions  of the Security
                Documents  and all  requirements  of the  Security  Documents in
                respect of such  insurance  have been complied  with  (including
                without   limitation,   confirmation  from  the  protection  and
                indemnity  association or other insurer with which such Ship is,
                or is to be, entered for insurance or insured against protection
                and indemnity  risks  (including  oil pollution  risks) that any
                necessary  declarations  required by the  association or insurer
                for the removal of any oil  pollution  exclusion  have been made
                and that any such exclusion does not apply to such Ship); and

(f)     Security documents and delivery documents

        the relevant Owner's Guarantee and the Ship Security  Documents for such
        Ship and the relevant Account Charge duly executed;

(g)     Borrower's and Owner's further corporate authorisations

        copies  of  the  resolutions  of the  Borrower's  and  relevant  Owner's
        directors and shareholders evidencing authorisation of the acceptance of
        the  delivery of such Ship and  authorisation  and  approval of the Ship
        Security  Documents  for  such  Ship and the  transactions  contemplated
        therein and any other documents  issued or to be issued pursuant thereto
        and authorising their appropriate  officers or other  representatives to
        execute the same on their behalf  certified in the manner referred to in
        paragraph  (b) of Part 1 of this  Schedule  (or other  evidence  of such
        authorisation,  approval and/or  ratification) and any power of attorney
        issued pursuant to the said resolutions;

(h)     Other further corporate authorisations

        copies  of the  resolutions  of the  directors  of each  Security  Party
        evidencing  authorisation and approval of the Manager's  Undertaking for
        such Ship to which such  Security  Party is, or is to be a party and the
        transactions  contemplated  therein and any other documents issued or to
        be issued pursuant  thereto and  authorising its appropriate  officer or
        other  representative to execute the same on its behalf certified in the
        manner referred to in paragraph (b) of Part 1 of this Schedule (or other
        evidence of such  authorisation,  approval and/or  ratification) and any
        power of attorney issued pursuant to the said resolutions;

(i)     Updated certificates of incumbency

        a list of directors and officers of each Security  Party  specifying the
        names and positions of such persons and copies of the  signatures of the
        persons who have been  authorised  on behalf of each  Security  Party to
        sign such of the  Underlying  Documents  and the  Security  Documents to
        which such Security Party is, or is to be, party and to give notices and
        communications,  including  notices of drawing,  under or in  connection
        with  the  Security  Documents,  certified  (in a  certificate  dated no
        earlier than five (5) Banking  Days prior to the Delivery  Date for such
        Ship) by an  officer  of such  Security  Party to be, in the case of the
        list of directors, true, complete and up to date and, in the case of the
        specimen signatures, true signatures of such persons or a certificate by
        an officer of such  Security  Party that the list provided in respect of
        the Security  Party pursuant to paragraph (d) of Part 1 of this Schedule
        and that the  specimen  signatures  provided in respect of the  Security
        Party pursuant to paragraph (c) of Part 1 of this Schedule  remain true,
        complete and up to date;

(j)     Management

        to the extent not provided pursuant to Schedule 4, Part 1, the Manager's
        Undertaking  duly  executed  and copies,  certified by an officer of the
        Borrower or the relevant  Owner,  of the  Management  Agreement for such
        Ship;

(k)     Mortgage registration

        evidence  that the Mortgage has been  provisionally  registered  against
        such Ship  through the Registry for such Ship under the laws and flag of
        the Flag State for such Ship;

(l)     Notices of assignment and acknowledgements

        copies of duly executed  notices of assignment  required by the terms of
        the  Security  Documents  and in the forms  prescribed  by the  Security
        Documents;

(m)     Bank accounts

        evidence that the Earnings Account for such Ship has been opened;

(n)     Insurance opinion

        an opinion from  insurance  consultants  appointed by the Agent,  on the
        insurances  effected  or to be effected in respect of such Ship upon and
        following the Delivery Date for such Ship;

(o)     Legal opinions

        (i)     Bermuda opinion

                an opinion of Conyers Dill & Pearman  special legal  advisers in
                Bermuda to the Agent;

        (ii)    English opinion

                an opinion of Norton Rose special legal advisers to the Agent as
                to matters of the laws of England;

        (iii)   Flag State opinion

                an opinion of the  special  legal  advisers  to the Agent in the
                Flag State of such Ship and an opinion  from the  special  legal
                advisers to the Agent in any  Relevant  Jurisdiction  where such
                Ship  has its  underlying  registration  as set out in Part 1 of
                Schedule 2; and

        (iv)    Further opinions

                any such further  opinion as may be required by the Agent and/or
                Banks;

(p)     Borrower's and Owner's process agent

        a copy,  certified as a true copy by the Borrower's or relevant  Owner's
        solicitors or other person  acceptable to the Agent of a letter from the
        Borrower's or relevant  Owner's or the relevant  Security  Party's agent
        for  receipt  of  service  of  proceedings  referred  to in  each of the
        relevant Ship Security Documents in which it is or is to be appointed as
        the Borrower's agent;

(q)     Valuation

        valuation  (dated not more than two (2) weeks prior to the Delivery Date
        of such  Ship)  of  such  Ship in its  anticipated  condition  as at the
        Delivery Date of such Ship;

(r)     Inspection report

        inspection  report  (dated not more than  thirty  (30) days prior to the
        Delivery Date of such Ship) of such Ship by a surveyor  appointed by the
        Agent;

(s)     Manager's confirmation

        the  Manager  has  confirmed  in writing  that the  representations  and
        warranties set out in clause 7.2.11 are true and correct;

(t)     Certificates of financial responsibility

        if  applicable,  a copy of a  certificate  of  financial  responsibility
        complying with the  requirements  of the United States Oil Pollution Act
        1990  or  the  United  States   Comprehensive   Environmental   Response
        Compensation  Liability  Act 1980  together  with  evidence  of approval
        thereof by the relevant regulatory authorities;

(u)     Payment of Contract Price

        if an Additional Ship is a newbuilding, evidence that the Contract Price
        for such Ship has been (or upon  drawdown  of the  Delivery  Advance for
        such Ship will have been) paid in full;

(v)     ISM Code and ISPS Code documentation

        a copy,  certified  by an officer of the  Borrower,  of the SMC, DOC and
        ISSC Certificate for such Ship; and

(w)     Fees, commissions and expenses

        evidence that any fees and commission due from the Borrower  pursuant to
        the  terms  of  clause  5.1  and any  other  provision  of the  Security
        Documents and all expenses under clause 5.2 have been paid in full.


<PAGE>

                                     Part 4

   Additional documents and evidence required as a condition precedent to any
Contract Instalment Advance and Delivery Date Instalment Advance

                          (referred to in clause 9.1)

(a)     Conditions precedent

        evidence that the  conditions  precedent set out in Part 1 and Part 2 of
        Schedule 4, remain fully satisfied;

(b)     No claim

        evidence  satisfactory  to the Agent  and/or the Banks that the relevant
        Builder  (and  any  other  party  who may have a claim  pursuant  to the
        relevant  Contract)  has no claims  against the  Additional  Ship or the
        Borrower or  relevant  Owner and that there have been no breaches of the
        terms of the  relevant  Contract or the Refund  Guarantee or any default
        thereunder;

(c)     No variations to Contract

        evidence that there have been no amendments or variations  agreed to the
        relevant Contract and that no action has been taken by the Borrower, the
        relevant  Owner or the  relevant  Builder  which might in any way render
        such Contract inoperative or unenforceable, in whole or in part;

(d)     No Encumbrance

        evidence that there is no  Encumbrance  of any kind created or permitted
        by any  person on or  relating  to the  relevant  Contract  other than a
        Permitted Encumbrance;

(e)     Equity contribution

        evidence in a form and  substance  satisfactory  to the Agent,  that the
        Borrower  or the  relevant  Owner has paid to the  relevant  Builder any
        required equity contribution for such Additional Ship;

(f)     Invoices

        a certified  copy of the invoices in respect of which  payment is due to
        the relevant  Builder  from the Borrower or the relevant  Owner and such
        other evidence as the Agent may reasonably  require that such payment is
        due and payable to such Builder;

(g)     Fees, commissions and expenses

        evidence  that any fees due from the  Borrower  pursuant to the terms of
        clause 5.1 or any expenses  under  clause 5.2 or any other  provision of
        the Security Documents have been paid in full; and

(h)     Title documents

        if  the  Additional  Ship  is a  newbuilding  copies  of  the  Builder's
        certificate  and bill of sale in favour of the  relevant  Owner from the
        Builder and a protocol of delivery and acceptance duly executed and such
        other evidence as the Agent may reasonably require  (including  evidence
        of the  Builder's  corporate  authorisations  to  deliver  title  to the
        relevant  Ship) that the  relevant  Owner will  obtain good title to the
        relevant Ship on or before the relevant Delivery Date.

<PAGE>

Schedule 5

                        Form of Substitution Certificate

[Note: Banks are advised not to employ Substitution Certificates or otherwise to
assign,  novate or transfer  interests in the Agreement  without first  ensuring
that the  transaction  complies with all applicable  laws and regulations in all
applicable jurisdictions.]

To:     THE GOVERNOR AND COMPANY OF BANK OF SCOTLAND on its own behalf, as agent
        for the Banks party to the Loan Agreement  mentioned below and on behalf
        of Aries Maritime Transport Limited.


Attention:                                                                [Date]

Substitution Certificate

This  Substitution  Certificate  relates to a  $360,000,000  Secured  Facilities
Agreement (the "Agreement")  dated [ 2006] between (i) Aries Maritime  Transport
Limited,  (ii) the banks whose  respective  names and  addresses  are set out in
Schedule 1 thereto as Banks,  (iii) Nordea Bank Finland plc,  London  Branch and
The Governor and Company of the Bank of Scotland as Arrangers,  (iv) Nordea Bank
Finland plc,  London Branch and The Governor and Company of the Bank of Scotland
and HBOS Treasury Services plc as Swap Banks and The Governor and Company of the
Bank of Scotland as Agent.

1       [name of Existing Bank] (the "Existing  Bank") (a) confirms the accuracy
        of the  summary of its  participation  in the  Agreement  set out in the
        schedule  below;  and  (b)  requests  [name  of  Substitute  Bank]  (the
        "Substitute")  to  accept  by  way  of  novation  the  portion  of  such
        participation  specified in the schedule hereto by  counter-signing  and
        delivering this Substitution Certificate to the Agent at its address for
        the  service  of  notices  specified  in the  Agreement  along  with the
        transfer fee of $3,000.

2       The  Substitute  hereby  requests the Agent (on behalf of itself and the
        other Banks) to accept this Substitution  Certificate as being delivered
        to the Agent  pursuant  to and for the  purposes  of clause  15.4 of the
        Agreement,  so as to take effect in accordance with the respective terms
        thereof on [date of transfer]  (the  "Effective  Date") or on such later
        date as may be  determined  in  accordance  with  the  respective  terms
        thereof.

3       The Agent (on behalf of itself, the other Banks and all other parties to
        the  Agency   Agreement)   confirms  the   novation   effected  by  this
        Substitution Certificate pursuant to and for the purposes of clause 15.4
        of the Agreement so as to take effect in accordance  with the respective
        terms thereof.

4       The Substitute confirms:

        (a)     that it has  received  a copy of the  Agreement  and each of the
                other  Security  Documents  and  all  other   documentation  and
                information  required by it in connection with the  transactions
                contemplated by this Substitution Certificate;

        (b)     that it has made and will continue to make its own assessment of
                the validity,  enforceability  and sufficiency of the Agreement,
                the other Security  Documents and this Substitution  Certificate
                and has not relied and will not rely on the Existing Bank or the
                Agent or any statements made by either of them in that respect;

        (c)     that it has  made  and  will  continue  to make  its own  credit
                assessment  of the Borrower and has not relied and will not rely
                on the  Existing  Bank or the  Agent or any  statements  made by
                either of them in that respect; and

        (d)     that, accordingly, neither the Existing Bank nor the Agent shall
                have  any  liability  or  responsibility  to the  Substitute  in
                respect of any of the foregoing matters.

5       Execution of this Substitution Certificate by the Substitute constitutes
        its  representation  to the Existing  Bank and all other  parties to the
        Agreement  that it has power to become party to the  Agreement as a Bank
        on the terms  herein  and  therein  set out and has taken all  necessary
        steps  to  authorise   execution  and  delivery  of  this   Substitution
        Certificate.

6       The  Existing  Bank makes no  representation  or warranty and assumes no
        responsibility  with respect to the legality,  validity,  effectiveness,
        adequacy or enforceability of the Agreement or any of the other Security
        Documents or any document relating thereto and assumes no responsibility
        for the  financial  condition  of the Borrower or any other party to the
        Agreement or any of the other Security  Documents or for the performance
        and  observance  by the  Borrower  or any other such party of any of its
        obligations  under the Agreement or any of the other Security  Documents
        or any document  relating  thereto and any and all such  conditions  and
        warranties,  whether express or implied by law or otherwise,  are hereby
        excluded.

7       The Substitute  hereby undertakes to the Existing Bank, the Borrower and
        the Agent and each of the other  parties to the  Agreement  that it will
        perform in accordance  with their terms all those  obligations  which by
        the  respective  terms  of the  Agreement  will be  assumed  by it after
        acceptance of this Substitution Certificate by the Agent.

8       All terms and  expressions  used but not  defined  in this  Substitution
        Certificate shall bear the meaning given to them in the Agreement.

9       This  Substitution  Certificate  and the rights and  obligations  of the
        parties  hereunder shall be governed by and construed in accordance with
        English law.

Note: This Substitution  Certificate is not a security,  bond, note,  debenture,
investment or similar instrument.

AS WITNESS the hands of the authorised  signatories of the parties hereto on the
date appearing below.

<PAGE>


                                  The Schedule




Commitment: $                                         Portion Transferred: $

Contribution: $                                       Portion Transferred: $

Next Interest Payment Date:




<PAGE>


                      Administrative Details of Substitute



Lending Office:

Account for payments:

Telephone:

Telex:

Attention:

[Existing Bank]                                     [Substitute]

By:                                                 By:
     -------------------                                -------------------
Date:                                               Date:

The Agent
By:


------------------------
on its own behalf
and on behalf of the Borrower,  the Banks, the Arranger,  the Co-Arrangers,  the
Swap Banks and the Security Trustee




<PAGE>


                                   Schedule 6


                             Compliance Certificate


To:     The Governor and Company of the Bank of Scotland
        New Uberior House
        11 Earl Grey Street
        Edinburgh EH3 9BN
        as Agent

From:   Aries Maritime Transport Limited
        Canon's Court
        22 Victoria Street
        Hamilton HM EX
        Bermuda

Dated: [o]

Dear Sirs

                        $360,000,000 Facilities Agreement
                           dated [o] (the "Agreement")

1       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.

2       We refer to clause 8.7 of the Agreement and hereby certify that:

        (1)     Equity Ratio

                Requirement: Equity Ratio of not less than 35%.

                Satisfied [YES] : [NO]

        (2)     Minimum Liquidity

                Requirement:  maintain  on  a  consolidated  basis  the  Minimum
                Liquidity.

                Satisfied [YES] : [NO]

        (3)     Working Capital

                Requirement:  maintain a consolidated  basis Working  Capital of
                not less than zero Dollars ($0).

                Satisfied [YES] : [NO]

        (4)     Interest Coverage

                Requirement: maintain a ratio of EBITDA to Interest Payable on a
                trailing four (4) Financial  Quarter basis of not less than 3.00
                to 1.00.

                Satisfied [YES] : [NO]

        (5)     Security Value Maintenance

                Requirement:  Security  Value  is not  less  than  the  Security
                Requirement.

                Satisfied [YES] : [NO]

        (6)     Liquidity of Manager

                Requirement:  the Manager has a credit  balance of not less than
                $1,000,000 in the Manager's Account.

                Satisfied [YES] : [NO]

3       We confirm that no Default is continuing.*


        ------------------------
        Chief Financial Officer
        Aries Maritime Transport Limited





----------------------------
for and on behalf of
[name of auditors of the Company]**


----------


*       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.

**      Only  applicable if the Compliance  Certificate  accompanies the audited
        financial  statements and is to be signed by the auditors.  To be agreed
        with the Company's auditors prior to signing the Agreement.


<PAGE>



                                   Schedule 7
                         Calculation of Additional Cost

1       The  Additional  Cost is an addition to the interest  rate to compensate
        Banks 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.

2       On the  first  day of each  Interest  Period  (or as  soon  as  possible
        thereafter) the Agent shall calculate, as a percentage rate, a rate (the
        "Additional Cost Rate") for each Bank, in accordance with the paragraphs
        set out below.  The Additional Cost will be calculated by the Agent as a
        weighted  average  of the Banks'  Additional  Cost  Rates  (weighted  in
        proportion to the percentage  participation of each Bank in the relevant
        Loan) and will be expressed as a percentage rate per annum.

3       The  Additional  Cost  Rate for any Bank  lending  from an office in any
        member  state of the European  Community  that has adopted or adopts the
        Euro as its lawful  currency in accordance  with the  legislation of the
        European  Community  relating to Economic and Monetary Union will be the
        percentage  notified by that Bank to the Agent.  This percentage will be
        certified  by that Bank in its notice to the Agent to be its  reasonable
        determination  of the cost  (expressed  as a  percentage  of that Bank's
        participation  in all Loans made from that office) of complying with the
        minimum reserve  requirements of the European Central Bank in respect of
        loans made from that office.

4       The  Additional  Cost  Rate for any Bank  lending  from an Office in the
        United Kingdom will be calculated by the Agent as follows:

        in relation to an Advance or an unpaid amount in any currency other than
        sterling:

        E x 0.01
        --------   per cent. per annum.
          300

        Where:

        E       is designed to  compensate  Banks for amounts  payable under the
                Fees Rules and is  calculated  by the Agent as being the average
                of the most recent  rates of charge  supplied  by the  Reference
                Banks to the Agent  pursuant to paragraph 6 below and  expressed
                in Pounds per (pound)1,000,000.

5       For the purposes of this Schedule:

        (a)     "Fees Rules" means the rules on periodic  fees  contained in the
                Supervision  Manual of the Financial Services Authority Handbook
                of rules and guidance 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;

        (b)     "Fee Tariffs" means the fee tariffs  specified in the Fees Rules
                under the activity  group A.1 Deposit  acceptors  (ignoring  any
                minimum  fee or zero  rated fee  required  pursuant  to the Fees
                Rules but taking into account any applicable discount rate);

        (c)     "Tariff  Base"  has the  meaning  given  to it in,  and  will be
                calculated in accordance with, the Fees Rules; and

        (d)     "Pounds" and  "(pound)"  mean the lawful  currency of the United
                Kingdom.

6       If  requested  by the  Agent,  each  Reference  Bank  shall,  as soon as
        practicable  after  publication  by the  Financial  Services  Authority,
        supply to the Agent,  the rate of charge  payable by that Reference Bank
        to the  Financial  Services  Authority  pursuant  to the  Fees  Rules in
        respect  of  the  relevant  financial  year  of the  Financial  Services
        Authority  (calculated  for this purpose by that Reference Bank as being
        the average of the Fee Tariffs  applicable  to that  Reference  Bank for
        that financial year) and expressed in Pounds per (pound)1,000,000 of the
        Tariff Base of that Reference Bank.

7       Each Bank shall  supply any  information  required  by the Agent for the
        purpose of  calculating  its Additional  Cost Rate. In  particular,  but
        without limitation,  each Bank shall supply the following information on
        or prior to the date on which it becomes a Bank:

        (a)     the jurisdiction of its lending office; and

        (b)     any other information that the Agent may reasonably  require for
                such purpose.

        Each  Bank  shall  promptly  notify  the  Agent  of  any  change  to the
        information provided by it pursuant to this paragraph.

8       The rates of charge of each  Reference  Bank for the  purpose of E above
        shall be determined by the Agent based upon the information  supplied to
        it  pursuant to  paragraphs  6 and 7 above and on the  assumption  that,
        unless  a  Bank  notifies  the  Agent  to  the  contrary,   each  Bank's
        obligations  in relation to cash ratio deposits are the same as those of
        a typical bank from its  jurisdiction  of  incorporation  with a lending
        office in the same jurisdiction as its lending office.

9       The Agent shall have no  liability  to any person if such  determination
        results in an Additional  Cost Rate which over or under  compensates any
        Bank and shall be entitled to assume  that the  information  provided by
        any Bank or Reference  Bank  pursuant to  paragraphs 3, 6 and 7 above is
        true and correct in all respects.

10      The Agent shall  distribute the additional  amounts received as a result
        of the Additional  Cost to the Banks on the basis of the Additional Cost
        Rate for each Bank based on the  information  provided  by each Bank and
        each Reference Bank pursuant to paragraphs 3, 6 and 7 above.

11      Any  determination by the Agent pursuant to this Schedule in relation to
        a formula,  the Additional  Cost, an Additional  Cost Rate or any amount
        payable to a Bank shall, in the absence of manifest error, be conclusive
        and binding on all Parties.

12      The Agent may from time to time,  after  consultation  with the Borrower
        and the Banks,  determine and notify to all Parties any amendments which
        are  required  to be made to this  Schedule  in order to comply with any
        change in law,  regulation or any requirements from time to time imposed
        by the Bank of England, the Financial Services Authority or the European
        Central Bank (or, in any case, any other authority which replaces all or
        any of its functions) and any such  determination  shall, in the absence
        of manifest error, be conclusive and binding on all Parties.

<PAGE>

Borrower

SIGNED by Mons S. Bolin                  )
for and on behalf of                     )
ARIES MARITIME TRANSPORT LIMITED         )
pursuant to a power of attorney          )
dated March 31, 2006                     )
                                                          /s/ Mons S. Bolin
                                                          -----------------
                                                          Attorney-in-fact


Arrangers

SIGNED by Rosmarie Soderbory             )
for and on behalf of                     )
THE GOVERNOR AND COMPANY OF              )
THE BANK OF SCOTLAND                     )
                                                          /s/ Rosmarie Soderbory
                                                          ----------------------
                                                          Authorised signatory


SIGNED by Chryso Adamou                  )
for and on behalf of                     )
NORDEA BANK FINLAND PLC, LONDON          )
BRANCH                                   )
                                                          /s/ Chryso Adamou
                                                          -----------------
                                                          Attorney-in-fact

Agent

SIGNED by Rosmarie Soderbory             )
for and on behalf of                     )
THE GOVERNOR AND COMPANY OF              )
THE BANK OF SCOTLAND                     )
                                                          /s/ Rosmarie Soderbory
                                                          ----------------------
                                                          Authorised signatory

Banks

SIGNED by Rosmarie Soderbory             )
for and on behalf of                     )
THE GOVERNOR AND COMPANY OF              )
THE BANK OF SCOTLAND                     )
                                                          /s/ Rosmarie Soderbory
                                                          ----------------------
                                                          Authorised signatory


SIGNED by Chryso Adamou                  )
for and on behalf of                     )
NORDEA BANK FINLAND PLC, LONDON          )
BRANCH                                   )
                                                          /s/ Chryso Adamou
                                                          -----------------
                                                          Attorney-in-fact


SIGNED by Chryso Adamou                  )
for and on behalf of                     )
HSH NORDBANK AG                          )
                                                          /s/ Chryso Adamou
                                                          -----------------
                                                          Attorney-in-fact

SIGNED by Chryso Adamou                  )
for and on behalf of                     )
THE GOVERNOR AND COMPANY                 )
OF THE BANK OF IRELAND                   )
                                                          /s/ Chryso Adamou
                                                          -----------------
                                                          Attorney-in-fact

SIGNED by Chryso Adamou                  )
for and on behalf of                     )
SUMITOMO MITSUI BANKING                  )
CORPORATION                              )
                                                          /s/ Chryso Adamou
                                                          -----------------
                                                          Attorney-in-fact

SIGNED by Chryso Adamou                  )
for and on behalf of                     )
BAYERISCHE HYPO- UND                     )
VEREINSBANK AG                           )
                                                          /s/ Chryso Adamou
                                                          -----------------
                                                          Attorney-in-fact

SIGNED by Chryso Adamou                  )
for and on behalf of                     )
COMMERZBANK AKTIENGESELLSCHAFT           )
                                                          /s/ Chryso Adamou
                                                          -----------------
                                                          Attorney-in-fact

SIGNED by Chryso Adamou                  )
for and on behalf of                     )
GENERAL ELECTRIC CAPITAL                 )
CORPORATION                              )
                                                          /s/ Chryso Adamou
                                                          -----------------
                                                          Attorney-in-fact

SIGNED by Chryso Adamou                  )
for and on behalf of                     )
NATEXIS BA                               )
NQUES POPULAIRES                         )
                                                          /s/ Chryso Adamou
                                                          -----------------
                                                          Attorney-in-fact

SIGNED by Chryso Adamou                  )
for and on behalf of                     )
SWEDBANK (FORENINGS-                     )
SPARBANKEN AB (PUBL.))                   )
                                                          /s/ Chryso Adamou
                                                          -----------------
                                                          Attorney-in-fact

Swap Banks

SIGNED by Rosmarie Soderbory             )
for and on behalf of                     )
THE GOVERNOR AND COMPANY OF              )
THE BANK OF SCOTLAND                     )
                                                          /s/ Rosmarie Soderbory
                                                          ----------------------
                                                          Attorney-in-fact

SIGNED by Chryso Adamou                  )
for and on behalf of                     )
NORDEA BANK FINLAND PLC, LONDON          )
BRANCH                                   )
                                                          /s/ Chryso Adamou
                                                          -----------------
                                                          Attorney-in-fact

SIGNED by Oliver Basi                    )
for and on behalf of                     )
HBOS TREASURY SERVICES PLC               )
                                                          /s/ Oliver Basi
                                                          ---------------
                                                          Authorised signatory

SIGNED by Michael Pithey                 )
for and on behalf of                     )
HBOS TREASURY SERVICES PLC               )
                                                          /s/ Michael Pithey
                                                          ------------------
                                                          Authorised signatory

SIGNED by Chryso Adamou                  )
for and on behalf of                     )
THE GOVERNOR AND COMPANY                 )
OF THE BANK OF IRELAND                   )
                                                          /s/ Chryso Adamou
                                                          -----------------
                                                          Attorney-in-fact

SIGNED by Chryso Adamou                  )
for and on behalf of                     )
HSH NORDBANK AG                          )
                                                          /s/ Chryso Adamou
                                                          -----------------
                                                          Authorised signatory

SIGNED by Michael Hartley                )
for and on behalf of                     )
SMBC CAPITAL MARKETS, INC.               )
                                                          /s/ Michael Hartley
                                                          -------------------
                                                          Authorised signatory

Co-Arrangers


SIGNED by Chryso Adamou                  )
for and on behalf of                     )
THE GOVERNOR AND COMPANY                 )
OF THE BANK OF IRELAND                   )
                                                          /s/ Chryso Adamou
                                                          -----------------
                                                          Attorney-in-fact

SIGNED by Chryso Adamou                  )
for and on behalf of                     )
HSH NORDBANK AG                          )
                                                          /s/ Chryso Adamou
                                                          -----------------
                                                          Attorney-in-fact
SIGNED by Chryso Adamou                  )
for and on behalf of                     )
SUMITOMO MITSUI BANKING                  )
CORPORATION                              )
                                                          /s/ Chryso Adamou
                                                          -----------------
                                                          Attorney-in-fact


SK 23248 0002 764951