1
INTERPRETATION
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2
FACILITY
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3
DRAWDOWN
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4
INTEREST
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INTERESTPERIODS
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DEFAULTINTEREST
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7
REPAYMENT ANDPREPAYMENT
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8
CONDITIONSPRECEDENT
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9
REPRESENTATIONS ANDWARRANTIES
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10
COVENANTS
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11
PAYMENTS ANDCALCULATIONS
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12
APPLICATION OFRECEIPTS
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13
EVENTS OFDEFAULT
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14
FEES ANDEXPENSES
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15
INDEMNITIES
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NO SET-OFF OR TAXDEDUCTION
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17
ILLEGALITY,ETC
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18
ASSIGNMENTS ANDPARTICIPATIONS; CHANGES IN LENDING OFFICE
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19
VARIATIONS ANDWAIVERS
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NOTICES
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GUARANTY
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JOINT AND SEVERALLIABILITY
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SUPPLEMENTAL
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THE FACILITY AGENT, THEPAYMENT AGENT AND THE SECURITY TRUSTEE
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LAW ANDJURISDICTION
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WAIVER OF JURYTRIAL
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27
PATRIOT ACT; OFAC AND BANKSECRECY ACT
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28
POSITION OF THE LENDERS ANDTHE SWAP BANKS
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| (1) | BEDFORD      MARITIME CORP., BRIGHTON MARITIME CORP., HARI MARITIME CORP., PROSPECT      NAVIGATION CORP., HANCOCK NAVIGATION CORP., COLUMBUS MARITIME CORP. and      WHITEHALL MARINE TRANSPORT CORP., each a corporation organized and      existing under the law of the Republic of The Marshall Islands, as joint      and several borrowers (each, a “Borrower” and together,      the “Borrowers”); |
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| (2) | TBS      INTERNATIONAL LIMITED, a company organized and existing under the law of      Bermuda, as guarantor (the “Guarantor”); |
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| (3) | THE      BANKS AND FINANCIAL INSTITUTIONS NAMED ON SCHEDULE 1 HERETO, as lenders      (together with any bank or financial institution which becomes a Lender      pursuant to Clause 18 hereof, the “Lenders”, and each      separately a “Lender”); |
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| (4) | DVB      GROUP MERCHANT BANK (ASIA) LTD., acting through its office at 77 Robinson      Road 30-02, Singapore, as facility agent (in such capacity, the “Facility Agent”) for the      Lenders and as security trustee (in such capacity, the “Security Trustee”) for      the Lenders and the Swap Banks; |
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| (5) | THE      GOVERNOR AND COMPANY OF THE BANK OF IRELAND, acting through its office at      Head Office, Building A3, Lower Baggot Street, Dublin 2, Ireland, as      payment agent (the “Payment Agent”) for the      Lenders; |
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| (6) | DVB      BANK AG, acting through its office at Friedrich-Ebert-Anlage 2-14, 600325      Frankfurt am Main, Federal Republic of Germany, THE GOVERNOR AND COMPANY      OF THE BANK OF IRELAND, acting through its office at Head Office, Building      A3, Lower Baggot Street, Dublin 2, Ireland, and NATIXIS, acting through      its office at BP 4 - F-75060, Paris Cedex 02, France, as swap banks (each,      a “Swap Bank” and      together, the “Swap      Banks”); and |
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| (7) | MOUNT      WASHINGTON LLC, c/o AER Holding N.V., Zeelandia Office Park, Kaya W.F.G.      Mensing 14, Curacao, Netherlands Antilles, as arranger (the “Arranger”). |
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| (a)   | Filscan,      in respect of the APACHE MAIDEN; |
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| (b)   | Viking,      in respect of the KICKAPOO BELLE; |
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| (c)   | Sea      Star, in respect of the NAVAJOPRINCESS; |
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| (d)   | General      Charterer, in respect of the INCAMAIDEN; |
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| (e)   | Viking,      in respect of the KIOWA PRINCESS; |
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| (f)   | Intermodal,      in respect of the SENECA MAIDEN;and |
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| (g)   | General      Charterer, in respect of the CHEROKEEPRINCESS; |
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|   | (a) | it      is entered into by the Borrowers and a Swap Bank pursuant to a Master      Agreement; |
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|   | (b) | its      purpose is to hedge the Borrowers’ exposure under this Agreement to      fluctuations in the interest rate arising from the funding of the Loan (or      any part thereof) for a period expiring no later than the Maturity Date;      and |
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|   | (c) | the      notional principal amount of such Transaction, together with all other      continuing Designated Transactions, does not and in the future (taking      into account the scheduled amortization thereof) will not exceed the      aggregate amount of the Loan scheduled to be outstanding from time to      time; |
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|   | (a) | all      freight, hire and passage moneys, compensation payable to the Borrower      owning the Ship in the event of requisition of the Ship for hire,      remuneration for salvage and 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 the      Ship; |
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|   | (b) | all      moneys which are at any time payable under Insurances in respect of loss      of earnings; and |
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|   | (c) | if      and whenever the Ship is employed on terms whereby any moneys falling      within paragraphs (a) or (b) above are pooled or shared with any other      person, that proportion of the net receipts of the relevant pooling or      sharing arrangement which is attributable to the  Ship; |
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|   | (a) | any      commercial bank organized under the laws of the United States, or any      State thereof, and having total assets in excess of      $1,000,000,000; |
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|   | (b) | any      commercial bank organized under the laws of any other country that is a      member of the OECD or has concluded special lending arrangements with the      International Monetary Fund Associated with its General Arrangements to      Borrow, or a political subdivision of any such country, and having total      assets in excess of $1,000,000,000, so long as such bank is acting through      a branch or agency located in the United States or in the country in which      it is organized or another country that is described in this clause      (b); |
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|   | (d) | any      finance company, insurance company or other financial institution or fund      (whether a corporation, partnership, trust or other entity) that (i) is      not an Affiliate of any of the Obligors, (ii) is engaged in making,      purchasing or otherwise investing in commercial loans in the ordinary      course of its business and (iii) has total assets in excess of      $1,000,000,000; and |
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|   | (e) | any      other Person (other than an Affiliate of any of the Obligors) whose      primary business is not owning, managing or chartering vessels approved by      the Facility Agent and the Obligors and having assets in excess of      $1,000,000,000, such approval not to be unreasonably    withheld; |
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| (a)   | as      at a date not more than 30 days prior to the date such valuation is      delivered to the Facility Agent; |
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| (b)   | by      a Broker; |
|-----------------|-------------------|

| (c)   | with      or without physical inspection of that Ship (as the Facility Agent may      require); |
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| (d)   | on      the basis of a sale for prompt delivery for cash on normal arm’s length      commercial terms as between a willing seller and a willing buyer, free of      any existing charter or other contract of employment (and with no value to      be given to any pooling arrangements);and |
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| (e)   | after      deducting the estimated amount of the usual and reasonable expenses which      would be incurred in connection with thesale; |
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|   | (g) | any      other document (whether creating a Security Interest or not) which is      executed at any time by an Obligor or any other person as security for, or      to establish any form of subordination or priorities arrangement in      relation to, any amount payable to or for the benefit of a Credit Party      under this Agreement or any of the documents referred to in this      definition; |
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|   | (a) | for      principal, interest or any other sum payable in respect of any moneys      borrowed or raised by the debtor; |
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|   | (c) | under      any acceptance credit, guarantee or letter of credit facility made      available to the debtor; |
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|   | (d) | under      a financial lease, a deferred purchase consideration arrangement or any      other agreement having the commercial effect of a borrowing or raising of      money by the debtor; |
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|   | (e) | under      any interest or currency swap or any other kind of derivative transaction      entered into by the debtor or, if the agreement under which any such      transaction is entered into requires netting of mutual liabilities, the      liability of the debtor for the net amount;or |
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|   | (f) | under      a guarantee, indemnity or similar obligation entered into by the debtor in      respect of a liability of another person which would fall within (a) to      (e) if the references to the debtor referred to the other      person; |
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|   | (a) | all      policies and contracts of insurance, including entries of the Ship in any      protection and indemnity or war risks association, which are effected in      respect of the Ship, her Earnings or otherwise in relation to her (except      for any loss of hire insurance);and |
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|   | (b) | all      rights and other assets relating to, or derived from, any of the      foregoing, including any rights to a return of a  premium; |
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|   | (a) | ‘The      International Management Code for the Safe Operation of Ships and for      Pollution Prevention’, currently known or referred to as the ‘ISM Code’      (including the guidelines on its implementation), adopted by the      International Maritime Organization (“IMO”) as Resolution      A.741(18) and Resolution A.913(22) (superseding Resolution A.788(19)) (and      the terms “safety      management system”, “Safety Management      Certificate” and “Document of Compliance”      have the same meanings as are given to them in the ISM Code);      and |
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|   | (b) | all      further resolutions, circulars, codes, guidelines, regulations and      recommendations which are now or in the future issued by or on behalf of      the IMO or any other entity with responsibility for implementing the ISM      Code; |
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|   | (a) | the      Document of Compliance and Safety Management Certificate issued pursuant      to the ISM Code in relation to such Ship within the periods specified by      the ISM Code; |
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|   | (b) | all      other documents and data which are relevant to the safety management      system and its implementation and verification which the Facility Agent      may require; and |
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|   | (c) | any      other documents which are prepared or which are otherwise relevant to      establish and maintain such Ship’s compliance or the compliance of the      relevant Borrower or relevant Approved Manager with the ISM Code which the      Facility Agent may require; |
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|   | (a) | each      and every person who has assumed responsibility for the operation of such      Ship and has agreed to take over or is required to assume responsibility      for the performance or observance of the duties and responsibilities      imposed by the ISM Code; and |
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|   | (b) | each      and every person ashore who is a ‘designated person’ for the purposes of      the ISM Code with direct access to the highest level of management of such      Ship’s owner or operator and who, in that capacity, has under the ISM Code      responsibility and authority whichincludes: |
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|   | (i) | monitoring      the safety and pollution prevention aspects of the operation of such Ship;      and |
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|   | (ii) | ensuring      that adequate resources and shore-based support are supplied, as required,      in each case, under the ISM Code; |
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| (a)   | the      International Ship Security Certificate issued pursuant to the ISPS Code      in relation to each Ship within the period specified in the ISPS Code;      and |
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| (b)   | all      other documents and data which are relevant to the ISPS Code and its      implementation and verification which the Facility Agent may      require; |
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|   | (b) | a      country in which the company’s central management and control is or has      recently been exercised; |
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|   | (c) | a      country in which the overall net income of the company is subject to      corporation tax, income tax or any similartax; |
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|   | (d) | a      country in which assets of the company (other than securities issued by,      or loans to, related companies) having a substantial value are situated,      in which the company maintains a permanent place of business, or in which      a Security Interest created by the company must or should be registered in      order to ensure its validity orpriority; |
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|   | (e) | a      country the courts of which have jurisdiction to make a winding up,      administration or similar order in relation to the company or which would      have such jurisdiction if their assistance were requested by the courts of      a country referred to in paragraphs (b) or (c) above;  and |
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|   | (a) | a      mortgage, charge or pledge, any maritime or other lien or any other      security interest of any kind; |
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|   | (b) | the      rights of the plaintiff under an action in rem in which the      vessel concerned has been arrested or a writ has been issued or similar      steps taken; and |
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|   | (c) | any      arrangement entered into by a person (A) the effect of which is to place      another person (B) in a position which is similar, in economic terms, to      the position in which B would have been had he held a security interest      over an asset of A; but (c) does not apply to a right of set off or      combination of accounts conferred by the standard terms of business of a      bank or financial institution; |
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|   | (a) | all      amounts which have become due for payment by either Obligor under the      Finance Documents have been paid; |
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|   | (b) | no      amount is owing or has accrued (without yet having become due for payment)      under any Finance Document; |
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|   | (c) | no      Obligor has any future or contingent liability under any provision of any      Finance Document; and |
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|   | (d) | no      Credit Party believes that there is a significant risk that any payment or      transaction under a Finance Document would be set aside, or would have to      be reversed or adjusted, in any present or possible future bankruptcy of      an Obligor or in any present or possible future proceeding relating to a      Finance Document or any asset covered (or previously covered) by a      Security Interest created by a FinanceDocument; |
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| (a)   | an      actual, constructive, arranged, agreed or compromised total loss of such      Ship; |
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| (b)   | any      requisition (whether or not for title) of such Ship by or on behalf of any      government or other authority (other than by way of requisition for hire      for a fixed period not exceeding one year without any right to an      extension); |
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| (c)   | the      capture, seizure, arrest, detention, confiscation, expropriation or      condemnation of such Ship (other than where the same amounts to      requisition (whether or not for title) of such Ship) by any governmental      authority, or by any person claiming to be or purporting to act on behalf      of any governmental authority, unless such Ship is released and returned      to the possession of her registered or demise owner within 12 months after      the capture, seizure, arrest, detention, confiscation, expropriation or      condemnation in question; or |
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| (d)   | assailing      thievery or piracy of such Ship, which deprives the operator of the use of      such Ship for a period of 90 days; |
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| (a)   | in      the case of an actual loss of such Ship on the actual date or at the time      such Ship was lost or, if such date is not known, on the date on which      such Ship was last reported; |
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| (b)   | in      the case of a constructive total loss of such Ship, on the date and at the      time notice of abandonment of such Ship is given to the insurers of such      Ship; |
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| (c)   | in      the case of an arranged, agreed or compromised total loss, on the date      upon which a binding agreement as to such arranged, agreed or compromised      total loss is entered into by the insurers of such  Ship; |
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| (d)   | in      the case of any requisition (whether or not for title) of such Ship by or      on behalf of any government or other authority (other than by way of      requisition for hire for a fixed period not exceeding one year without any      right to an extension), on the date on which such requisition      occurred; |
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| (e)   | in      the case of the capture, seizure, arrest, detention, confiscation,      expropriation or condemnation of such Ship (other than where the same      amounts to requisition (whether or not for title) of such Ship) by any      governmental authority, or by any person claiming to be or purporting to      act on behalf of any governmental authority, which deprives the operator      of the use of such Ship for more than 12 months, upon the expiry of the      period of 12 months after the date upon which the capture, seizure,      arrest, detention, confiscation, expropriation or condemnation of such      Ship occurred; |
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| (f)   | in      the case of assailing thievery or piracy of such Ship, which deprives the      operator of the use of such Ship for a period of 90 days, upon the expiry      of the period of 90 days after the date upon which the assailing thievery      or piracy occurred; and |
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| (g)   | in      the case of any other type of total loss, on the date (or the most likely      date) on which it appears to the Majority Lenders that the event      constituting the total lossoccurred; |
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| 1.3 | Meaning of      “month”.  A period of one or more “months” ends on the      day in the relevant calendar month numerically corresponding to the day of      the calendar month on which the period started (“the numerically corresponding      day”),      but: |
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| (a) | on      the Business Day following the numerically corresponding day if the      numerically corresponding day is not a Business Day or, if there is no      later Business Day in the same calendar month, on the Business Day      preceding the numerically corresponding day;or |
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| (b) | on      the last Business Day in the relevant calendar month, if the period      started on the last  Business Day in a calendar month or if the      last calendar month of the period has no numerically corresponding      day; |
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| 1.4 | Meaning of      “subsidiary”.  A company (S) is a subsidiary of another      company (P) (the “parent      company”) if: |
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| (a) | a      majority of the issued equity in S (or a majority of the issued equity in      S which carry unlimited rights to capital and income distributions) are      directly owned by P or are indirectly attributable to P;  or |
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| (b) | P      has direct or indirect control over a majority of the voting rights      attaching to the issued shares of S;or |
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| (c) | P      has the direct or indirect power to appoint or remove a majority of the      directors of S; or |
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| (d) | P      otherwise has the direct or indirect power to ensure that the affairs of S      are conducted in accordance with the wishes of  P; |
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|   | (i) | references      to, or to a provision of, a Finance Document or any other document are      references to it as amended or supplemented, whether before the date of      this Agreement or otherwise; |
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|   | (ii) | references      to, or to a provision of, any law include any amendment, extension,      re-enactment or replacement, whether made before the date of this      Agreement or otherwise; |
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|   | (iv) | Clauses      1.1 to 1.4 and paragraph (a) of this Clause 1.5 apply unless the contrary      intention appears; |
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| (b) | References      in Clause 1.1 to a document being in the form of a particular Appendix      include references to that form with any modifications to that form which      the Facility Agent approves or reasonably requires;  and |
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| 2.1 | Amount of      facility.  Subject to the other provisions of this      Agreement, the Lenders severally agree to make available to the Borrowers,      on a joint and several basis, a loan facility of up to the lesser of      $75,000,000 and 59% of the aggregate Fair Market Value of the      Ships. |
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| 2.2 | Lenders’      participations.  Subject to the other provisions of this      Agreement, each Lender shall participate in the Advance in an amount equal      to its Ratable Portion of the Advance as at the Actual Drawdown      Date. |
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| 2.3 | Purpose of      Loan.  The Borrowers undertake to use the Loan only for      the purposes stated in the preamble to this  Agreement. |
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| 3.1 | Request for the      Advance.  Subject to the following conditions, the      Borrowers may request the Advance to be made by delivering to the Facility      Agent a completed Drawdown Notice not later than 11:00 a.m. (New York      time) three (3) Business Days prior to the Expected Drawdown Date      thereof.  The Facility Agent shall promptly notify the Lenders      that it has received a Drawdown Notice and shall inform each Lender      of: |
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| (c) | the      duration of the first Interest Period applicable to the      Advance. |
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| (a) | the      Expected Drawdown Date and Actual Drawdown Date must be a Business Day      during the Availability Period; |
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| (b) | there      shall be no more than a single Advance and the Loan shall not exceed the      lesser of $75,000,000 and 59% of the aggregate Fair Market Value of the      Valuation Ships; |
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| (c) | the      outstanding principal amount of the Advances shall not exceed the Total      Commitments; and |
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| (d) | the      applicable conditions precedent stated in Clause 8 hereof shall have been      satisfied or waived as providedtherein. |
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| 3.3 | Drawdown Notice      irrevocable.  A Drawdown Notice must be signed by an      officer or duly authorized attorney-in-fact of each Borrowers; and once      served, a Drawdown Notice cannot be revoked without the prior consent of      the Facility Agent, acting with the authority of the Majority      Lenders. |
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| (a) | Each      Lender shall before 11:00 a.m. (New York City time) make its Ratable      Portion of each Advance available to the Payment Agent, for the account of      the Borrowers, on and with the value date of the Expected Drawdown Date      for such Advance.  After the Payment Agent’s receipt of such      funds and upon fulfillment or waiver of the applicable conditions set      forth in Clause 8 hereof, the Payment Agent will make such funds available      to the Borrowers by paying such funds to such account(s) which the      Borrowers specify in the Drawdown Notice.  The payment by the      Payment Agent under this Clause 3.4 to such account(s) shall constitute      the making of an Advance to the Borrowers and the Borrowers shall      thereupon become indebted, jointly and severally as principal and direct      obligors, to each Lender in an amount equal to such Lender’s Ratable      Portion of an Advance. |
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| (b) | Unless      the Payment Agent shall have received notice from a Lender prior to the      relevant Expected Drawdown Date that such Lender will not make available      to the Facility Agent such Lender’s Ratable Portion of an Advance, the      Payment Agent may assume, or at its option request confirmation from such      Lender, that such Lender has made its Ratable Portion available to the      Payment Agent on such date in accordance with subsection (a) of this      Clause 3.4 and the Payment Agent may in its sole discretion, in reliance      upon such assumption or confirmation (as the case may be), make available      to the Borrowers (by paying such funds to such account(s) which the      Borrowers specify in the Drawdown Notice) on such date a corresponding      amount.  If and to the extent that such Lender shall not have so      made such Ratable Portion available to the Payment Agent, such Lender and      the Borrowers (but without duplication) severally agree to repay to the      Payment Agent forthwith on demand such corresponding amount, together with      interest thereon, for each day from the date such amount is made available      to the Borrowers by the Payment Agent until the date such amount is repaid      to the Payment Agent, at the LIBOR rate for overnight or weekend      deposits.  If such Lender shall pay to the Payment Agent such      corresponding amount, such amount so paid shall constitute such Lender’s      Ratable Portion of such Advance for purposes of this      Agreement.  Nothing in this Clause 3.4(b) shall be deemed to      relieve any Lender of its obligation to make Advances to the extent      provided in this Agreement. |
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| (c) | In      the event that the Borrowers are required to repay all or a portion of an      Advance pursuant to Clause 3.4(b), as between the Borrowers and the      defaulting Lender, the liability for any breakage costs as described in      Clause 17.2 shall be borne by the defaulting Lender, provided that if the      defaulting Lender has not paid any such breakage costs upon demand by the      Payment Agent therefor, the Borrowers shall pay such breakage costs upon      demand by the Payment Agent and the Borrowers shall be entitled to recover      from the defaulting Lender any such payment for breakage costs made by the      Borrowers. |
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| 3.5 | Notation of Advances on      Note.  Each Advance made by the Lenders to the Borrowers      may be evidenced by a notation of the same made by the Facility Agent on      the grid attached to the Note, which notation, absent manifest error,      shall be prima      facie evidence of the amount of the  Advance. |
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| 4.1 | Normal rate of      interest.  Subject to the provisions of this Agreement,      the rate of interest on the Loan or any part thereof in respect of an      Interest Period shall be the aggregate of the Margin and LIBOR for that      Interest Period. |
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| 4.2 | Payment of normal      interest.  Subject to the provisions of this Agreement,      interest on the Loan or any part thereof in respect of each Interest      Period shall be paid by the Borrowers on the last day of that Interest      Period, unless the Borrowers shall have selected a 6 or 12 month Interest      Period, in which case interest on the Loan or any part thereof shall also      be payable quarterly in arrears. |
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| 4.3 | Payment of accrued      interest.  In the case of an Interest Period longer than      3 months, accrued interest shall be paid every 3 months during that      Interest Period and on the last day of that Interest    Period. |
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| 4.4 | Notification of interest      rate.  The Facility Agent shall notify the Borrowers and      each Lender of the rate of interest as soon as it is      determined. |
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| 4.5 | Notification of market      disruption.  The Facility Agent shall promptly notify the      Borrowers if: |
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| (a) | it      is unable to determine LIBOR; |
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| (b) | at      least one (1) Business Day before the start of an Interest Period, Lenders      having Commitments amounting to more than 50% of the Total Commitments      notify the Facility Agent that LIBOR fixed by the Facility Agent would not      accurately reflect the cost to those Lenders of funding their respective      Ratable Portion (or any part of them) during the Interest Period in the      London Interbank Market at or about 11:00 a.m. (London time) on the      Quotation Date for the Interest Period;or |
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| (c) | if      for any reason a Lender (the “Affected Lender”) is      unable to obtain Dollars in the London Interbank Market in order to fund      all or any part of its Ratable Portion of the Advance during any Interest      Period, |
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| 4.6 | Suspension of      drawdown.  If the Facility Agent’s notice under Clause      4.5 is served before the Advance is made, then while the circumstances      referred to in the Facility Agent’s notice  continue: |
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| (a) | in      the case of Clause 4.5(a) or (b), each Lender’s obligation to make its      Ratable Portion of the Advance; and |
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| (b) | in      the case of Clause 4.5(c), the Affected Lender’s obligation to make its      Ratable Portion of the Advance, |
|-----|----------------------------------------------------------------------------------------------------------------------------|

| 4.7 | Negotiation of alternative rate      of interest.  If the Facility Agent’s notice under Clause      4.5 is served after the Advance is made, the Borrowers, the Facility Agent      and the Lenders or (as the case may be) the Affected Lender shall use      reasonable endeavors to agree, within the 30 days after the date on which      the Facility Agent serves its notice under Clause 4.5 (the “Negotiation Period”), an      alternative interest rate or (as the case may be) an alternative basis for      each Lender or (as the case may be) the Affected Lender to fund or      continue to fund its Ratable Portion of the relevant Advance or Advances      during the Interest Periodconcerned. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 4.8 | Application of agreed      alternative rate of interest.  Any alternative interest      rate or an alternative basis which is agreed during the Negotiation Period      shall take effect in accordance with the terms  agreed. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 4.9 | Alternative rate of interest in      absence of agreement.  If an alternative interest rate or      alternative basis is not agreed within the Negotiation Period, and the      relevant circumstances are continuing at the end of the Negotiation      Period, then the Facility Agent shall set an interest period and interest      rate representing the cost of funding of the Lenders or (as the case may      be) the Affected Lender in Dollars or in any available currency of their      or its Ratable Portion of the relevant Advance or Advances plus the      applicable Margin; and the procedure provided for by this Clause 4.9 shall      be repeated if the relevant circumstances are continuing at the end of the      interest period so set by the FacilityAgent. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 4.10 | Notice of      prepayment.  If the Borrowers do not agree with an      interest rate set by the Facility Agent under Clause 4.9, the Borrowers      may give the Facility Agent not less than five (5) Business Days’ notice      of their intention to prepay (without premium or penalty) the Advance at      the end of the interest period set by the Facility  Agent. |
|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 4.11 | Prepayment; termination of      Commitments.  A notice under Clause 4.10 shall be      irrevocable.  The Facility Agent shall promptly notify the      Lenders or (as the case may be) the Affected Lender of the Borrowers’      notice of intended prepayment and: |
|------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (a) | on      the date on which the Facility Agent so notifies the Lenders or (as the      case may be) the Affected Lender, the Total Commitments or (as the case      may be) the Commitment of the Affected Lender shall be cancelled;      and |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | on      the last Business Day of the interest period set by the Facility Agent,      the Borrowers shall prepay (without premium or penalty) the Loan or (as      the case may be) the Affected Lender’s Ratable Portion, together with      accrued interest thereon at the applicable rate plus the      Margin. |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 4.12 | Application of      prepayment.  The relevant provisions of Clause 7 in      respect of a voluntary prepayment shall apply in relation to the      prepayment. |
|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 4.13 | Designated      Transactions.  The Borrowers shall enter into Designated      Transactions with the Swap Banks in an aggregate notional principal amount      of up to or equal to the aggregate principal amount of the Loan      outstanding from time to time on such terms as the Swap Banks and the      Borrowers shall agree.  The Borrowers hereby agree and undertake      throughout the Security Period not to conclude Designated Transactions      which would result, at any time during the Security Period, in the      notional principal amount of all Designated Transactions then remaining      exceeding the amount of the Loan. |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 5.1 | Duration of normal Interest      Periods.  Subject to Clause 5.2, each Interest Period in      relation to the Outstanding Indebtedness shall  be: |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (a) | 3,      6, 9 or 12 months, but no more than three one-month periods per year, as      notified by the Borrowers to the Facility Agent not later than 11:00 a.m.      (New York time) three (3) Business Days before the commencement of the      Interest Period; or |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | 3      months, if the Borrowers fail to notify the Facility Agent by the time      specified in paragraph (a) above;or |
|-----|------------------------------------------------------------------------------------------------------------------------|

| 5.2 | Duration of Interest Periods      overrunning Repayment Date.  If the Borrowers have      selected an Interest Period which would overrun a Repayment Date or      Repayment Dates, then: |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (a) | in      the case of the final Repayment Date, the Interest Period shall end on the      final Repayment Date; and |
|-----|-------------------------------------------------------------------------------------------------------------------|

|   | (i) | the      amount of each repayment installment (or, as the case may be, the      aggregate amount of installments payable on the same date pursuant to      Clause 7.2) falling due before the end of the Interest Period selected      shall have an Interest Period ending on the Repayment Date on which it      falls (or, as the case may be, they fall) due;  and |
|--------|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (ii) | the      balance of the Loan from time to time outstanding during such Interest      Period shall have an Interest Period ascertained in accordance with the      provisions of Clause 5.1; |
|--------|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 6.1 | Payment of default interest on      overdue amounts.  The Borrowers shall pay interest in      accordance with the following provisions of this Clause 6 on any amount      payable by the Borrowers under any Finance Document which the Facility      Agent, the Security Trustee or a Lender, as the case may be, does not      receive on or before the relevant date, thatis: |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (a) | the      date on which a Finance Document provide that such amount is due for      payment; or |
|-----|------------------------------------------------------------------------------------------------|

| (b) | if      a Finance Document provides that such amount is payable on demand, the      date on which the demand is served;or |
|-----|---------------------------------------------------------------------------------------------------------------------------|

| (c) | if      such amount has become immediately due and payable under Clause 13.2, the      date on which it became immediately due and  payable. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------|

| 6.2 | Rate of default      interest.  Interest shall accrue on an overdue amount      from (and including) the relevant date until the date of actual payment      (as well after as before judgment) at the rate per annum determined by the      Facility Agent to be 2 percent plus the Margin plus LIBOR for a period of      1 month (determined by the Facility Agent on the first Business Day of      each calendar month). |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 6.3 | Notification of rates of      default interest.  The Facility Agent shall promptly      notify the Borrowers of each interest rate determined by the Facility      Agent under Clause 6.2; but this shall not be taken to imply that the      Borrowers are liable to pay such interest only with effect from the date      of the Facility Agent’snotification. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 6.4 | Payment of accrued default      interest.  Subject to the other provisions of this      Agreement, any interest due under this Clause shall be paid on      demand. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 6.5 | Compounding of default      interest.  Any such interest which is not paid on the      date on which it is due for payment shall thereupon be compounded      daily. |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 6.6 | Application to Master      Agreements.  For the avoidance of doubt, this Clause 6      does not apply to any amount payable under a Master Agreement in respect      of any continuing Designated Transaction as to which Section 2(e) (Default      Interest; Other Amounts) of that Master Agreement shall    apply. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 7.1 | Amount and dates of repayment      installments.  The Borrowers shall repay the Loan in 20      consecutive quarterly installments of $4,892,000 each for installments 1      through 10, and $2,608,000 each for installments 11 through      20. |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 7.2 | Repayment      Dates.  The first repayment installment in respect of the      Advance shall be made on the date falling three (3) months after the      Actual Drawdown Date of the Advance.  Each subsequent repayment      installment in respect of the Advance shall be repaid quarterly thereafter      and the last repayment installment shall be repaid on the Maturity Date,      together with all other sums then accrued or owing under any Finance      Document. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 7.3 | Voluntary      prepayment.  Subject to the following conditions, the      Borrowers may prepay the whole or any part of the  Loan. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------|

| (a) | that      a partial prepayment shall be in an amount not less than $1,000,000 and      increments of an integral multiple of  $1,000,000; |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | that      the Facility Agent has received from the Borrowers at least ten (10)      Business Days’ prior written notice specifying the amount to be prepaid      and the date on which the prepayment is to be made;  and |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (c) | the      Borrowers have provided evidence satisfactory to the Facility Agent that      any consent required by the Borrowers in connection with the prepayment      has been obtained and remains in force, and that any regulation relevant      to this Agreement which affects the Borrowers has been complied with      (which may be satisfied by the Borrowers certifying that no consents are      required and that no regulations need to be complied  with). |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 7.5 | Effect of notice of      prepayment.  A prepayment notice may not be withdrawn or      amended without the consent of the Facility Agent and the amount specified      in the prepayment notice shall become due and payable by the Borrowers on      the date for prepayment specified in the prepayment  notice. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 7.6 | Notification to Lenders of      notice of prepayment.  The Facility Agent shall notify      the Lenders promptly upon receiving a prepayment notice, and shall provide      any Lender which so requests with a copy of any document delivered by the      Borrowers under Clause 7.4(c). |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 7.7 | Mandatory      prepayment.  If a Ship is sold or becomes a Total Loss,      the Borrowers shall prepay the Loan in an amount equal to the net sale or      insurances proceeds (as the case may be) received for such      Ship: |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (a) | in      the case of a sale, on the date on which the sale is completed by delivery      of the Ship to the buyer; or |
|-----|----------------------------------------------------------------------------------------------------------------------|

| (b) | in      the case of a Total Loss, on the earlier of the date falling 120 days      after the Total Loss Date and the date of receipt by the Security Trustee      of the proceeds of insurance relating to such Total  Loss. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (a) | accrued      interest (and any other amount payable under Clause 15.1 below or      otherwise) in respect of the amountprepaid; |
|-----|---------------------------------------------------------------------------------------------------------------------------------|

| (b) | if      the prepayment is not made on the last day of an Interest Period, together      with any sums payable under Clause 15.2;and |
|-----|-------------------------------------------------------------------------------------------------------------------------------------|

| (c) | but      without premium or penalty except in the case of a voluntary prepayment,      for which the Borrowers shall pay a prepayment penalty equal      to: |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (i) | 1.0%      of the amount prepaid if the voluntary prepayment is made prior to or the      first anniversary of the Actual Drawdown Date;  or |
|--------|-----|---------------------------------------------------------------------------------------------------------------------------------------------|

|   | (ii) | 0.5%      of the amount prepaid if the voluntary prepayment is made after the first      anniversary of the Actual Drawdown Date but prior to or on the second      anniversary of the Actual DrawdownDate. |
|--------|------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 7.9 | Application of      prepayment.  Each prepayment shall be applied as required      by Clause 12.1 hereof, provided that      prepayments shall be applied to the remaining repayment installments of      principal and interest in inverse order of  maturity. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 7.11 | Unwinding of Designated      Transactions.  On or prior to any repayment or prepayment      under this Clause 7, the Borrowers shall wholly or partially reverse,      offset, unwind or otherwise terminate one or more of the continuing      Designated Transactions to the extent necessary to ensure that the      aggregate notional principal amount of the continuing Designated      Transactions thereafter remaining does not and will not in the future      (taking into account the scheduled amortization thereof) exceed the      aggregate amount of the Loan scheduled to be outstanding from time to time      hereunder. |
|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 7.12 | Repayment of Swap      Benefit.  If a Designated Transaction is terminated in      circumstances where the Swap Banks would be obliged to pay an amount to      the Borrowers under the Master Agreement, the Borrowers hereby agree that      such payment shall be applied in prepayment of the Loan under Clause 7.9      and authorizes Swap Banks to pay such amount to the Payment Agent for such      purpose. |
|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 8.1 | Documents, fees and no      default.  Each Lender’s obligation to make its Ratable      Portion of the Advance is subject to the following conditions      precedent: |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (a) | that      on or before the service of the Drawdown Notice, the Facility Agent shall      have received: |
|-----|---------------------------------------------------------------------------------------------------------|

|   | (ii) | such      documentation and other evidence as is reasonably requested by the      Facility Agent, a Lender or a Swap Bank in order for each Lender or Swap      Bank, as the case may be, to carry out and be satisfied with the results      of all necessary “know your customer” or other checks which it is required      to carry out in relation to the transactions contemplated by this      Agreement and the other Finance Documents, including without limitation      obtaining, verifying and recording certain information and documentation      that will allow the Facility Agent, each of the Lenders and the Swap Banks      to identify each of the Obligors in accordance with the requirements of      the USA PATRIOT Act (Title III of Pub.: 107-56 (signed into law October      26, 2001)) (the “PATRIOT      Act”); |
|--------|------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | that      on or before the Expected Drawdown Date of the Advance, the Facility Agent      shall have received (i) the documents described in Schedule 3, each to be      in form and substance satisfactory to the Facility Agent and its lawyers,      and (ii) payment of all accrued commitment fees and all other fees and      expenses referred to in Clause 14 that are payable at that      time; |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (c) | that      at the date of the Drawdown Notice, at the Expected Drawdown Date and at      the Actual Drawdown Date: |
|-----|-------------------------------------------------------------------------------------------------------------------|

|   | (i) | no      Event of Default or Potential Event of Default has occurred and is      continuing or would result from the borrowing of the Loan or any part      thereof; |
|--------|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (ii) | the      representations and warranties in Clause 9 and those of any Obligor which      are set out in the other Finance Documents would be true and not      misleading if repeated on each of those dates with reference to the      circumstances then existing; |
|--------|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (iii) | there      has been no material adverse change in the financial condition, operations      or business prospects of any of the Obligors since the date on the      Obligors provided information concerning those topics to the Facility      Agent and/or any Lender; and |
|--------|-------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (iv) | none      of the circumstances contemplated by Clause 4.5 has occurred and is      continuing; |
|--------|------|------------------------------------------------------------------------------------------------|

| (h) | that,      if the Collateral Maintenance Ratio were applied immediately following the      making of the Advance, the Borrowers would not be obliged to provide      additional Collateral or prepay part of the Loan (and if the Borrowers      would be so obliged the amount of the Advance shall be correspondingly      reduced); and |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (i) | that      the Facility Agent shall have received, and found to be acceptable to it,      any further opinions, consents, agreements and documents in connection      with the Finance Documents which the Facility Agent may reasonably request      by notice to the Borrowers prior to the relevant Expected Drawdown      Date. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 8.2 | Waiver of conditions      precedent.  If the Facility Agent, acting upon the      instructions of the Majority Lenders, permits the Loan to be borrowed      before certain of the conditions referred to in Clause 8.1 are satisfied,      the Borrowers shall ensure that those conditions are satisfied within five      (5) Business Days after the Actual Drawdown Date (or such longer period as      the Facility Agent may specify). |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 9.2 | Status.  Each      Obligor is: |
|-----|------------------------------------------|

| (a) | duly      formed and validly existing and in good standing under the law of its      jurisdiction of formation; and |
|-----|---------------------------------------------------------------------------------------------------------------------|

| (b) | duly      qualified and in good standing as a foreign company in each other      jurisdiction in which it owns or leases property or in which the conduct      of its business requires it to so qualify or be licensed except where, in      each case, the failure to so qualify or be licensed and be in good      standing could not reasonably be expected to have a material adverse      effect on its business, assets or financial condition or which may affect      the legality, validity, binding effect or enforceability of the Finance      Documents. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | and      there are no proceedings or actions pending or contemplated by any      Obligor, or to the knowledge of the Obligors contemplated by any third      party, to dissolve, wind-up or terminate any  Obligor. |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 9.3 | Company power;      consents.  Each Obligor has the capacity and has taken      all action, and no consent of any person is required,  for: |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------|

| (a) | it      to own or lease and operate its properties and to carry on its business as      now conducted and as proposed to beconducted; |
|-----|---------------------------------------------------------------------------------------------------------------------------------------|

| (b) | it      to execute the Bareboat Charter, Memorandum of Three Party Agreement and      the Finance Documents to which it is or is to become a    party; |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------|

| (c) | it      to borrow under this Agreement and for it to make all payments      contemplated by, and to comply with, the obligations of the Finance      Documents to which it is or is to become a  party; |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (d) | it      to comply with its obligations under the under the Bareboat Charter and      Memorandum of Three Party Agreement to which it is a  party; |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------|

| (e) | it      to grant the liens granted by it pursuant to the Finance Documents to      which it is a party; |
|-----|---------------------------------------------------------------------------------------------------------|

| (f) | the      perfection or maintenance of the liens created by the Finance Documents      (including the first priority nature thereof);  and |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------|

| (g) | the      exercise by the Facility Agent, Security Trustee, any Swap Bank or any      Lender of their rights under any of the Finance Documents or the remedies      in respect of the Collateral pursuant to the Finance      Documents; |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 9.4 | Consents not liable to      revocation.  Nothing has occurred which makes any of the      consents referred to in Clause 9.3 liable to revocation, and each Obligor      is in compliance with all applicablelaws. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 9.5 | Legal validity; effective      Security Interests. |
|-----|----------------------------------------------------|

| (a) | Each      Bareboat Charter and Finance Document to which each Obligor is a party do      now or, as the case may be, will, upon execution and delivery (and, where      applicable, registration as provided for in the Finance Documents)      constitute such Obligor’s legal, valid and binding obligations enforceable      against it in accordance with their respective terms (subject, in the case      of each Bareboat Charter, to the relevant Memorandum of Three Party      Agreement); and |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | The      Finance Documents to which each Obligor is a party do now or, as the case      may be, will, upon execution and delivery (and, where applicable,      registration as provided for in the Finance Documents) create legal, valid      and binding Security Interests enforceable in accordance with their      respective terms over all the assets to which they, by their terms,      relate; |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 9.6 | No conflicts; no      liens.  The execution by each Obligor of each Finance      Document and the respective Bareboat Charter and Memorandum of Three Party      Agreement to which it is a party, the borrowing by the Borrowers of the      Loan, the compliance by each Obligor with its obligations under the      respective Bareboat Charter and Memorandum of Three Party Agreement and      under each Finance Document to which it is a party, will    not: |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (a) | involve      or lead to a contravention of (i) any law or regulation or order, writ,      judgment, injunction, decree, determination or award applicable to such      Obligor; (ii) the constitutional documents of such Obligor; or (iii) any      contractual or other obligation or restriction which is binding on such      Obligor or any of its assets; and |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | except      for liens created by the Finance Documents, result in or require the      creation or imposition of any lien upon or with respect to any of the      properties of such Obligor. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 9.7 | Taxes. |
|-----|--------|

| (a) | All      payments which an Obligor is liable to make under the Finance Documents to      which it is a party may be made without deduction or withholding for or on      account of any tax payable under any law of any Pertinent      Jurisdiction. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | Each      Obligor has filed or has caused to be filed all tax returns and other      reports that it is required by law or regulation to file in any Pertinent      Jurisdiction, and has paid or caused to be paid all taxes, assessments and      other similar charges that are due and payable in any Pertinent      Jurisdiction, other than taxes and charges (i) which are (x) not yet      delinquent or (y) being contested in good faith by appropriate proceedings      and for which adequate reserves have been established and in a manner that      does not involve any risk of sale, forfeiture, loss, confiscation or      seizure of any of the Ships, or (ii) the non-payment of which could not      reasonably be expect to have a material adverse effect on such      Obligor.  The charges, accruals, and reserves on the books of      each Obligor respecting taxes are adequate in accordance with applicable      accounting principles andpractices. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (c) | No      material claim for any tax has been asserted against any of the Obligors      or any of their Affiliates by any Pertinent Jurisdiction or other taxing      authority other than claims that are included in the liabilities for taxes      in the most recent balance sheet of such Obligor or disclosed in the notes      thereto, if any. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (d) | The      execution, delivery, filing and registration or recording (if applicable)      of the Finance Documents, each Bareboat Charter, and the consummation of      the transactions contemplated thereby, will not cause any of the Credit      Parties to be required to make any registration with, give any notice to,      obtain any license, permit or other authorization from, or file any      declaration, return, report or other document with any governmental      authority in New York, the Marshall Islands, Liberia, the Philippines or      any Pertinent Jurisdiction. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (e) | No      taxes are required by any governmental authority in New York, the Marshall      Islands, Liberia, the Philippines or any Pertinent Jurisdiction to be paid      with respect to or in connection with the execution, delivery, filing,      recording, performance or enforcement of any Finance    Document. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (f) | The      execution, delivery, filing, registration, recording, performance and      enforcement of the Finance Documents by any Credit Party will not cause      such Credit Party to be deemed to be resident, domiciled or carrying on      business in or subject to taxation under any law or regulation of any      governmental authority in the Marshall Islands, Liberia, the Philippines      or any Pertinent Jurisdiction. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (g) | Other      than the recording of each Mortgage in accordance with the laws of the      relevant Approved Primary Flag and the filing of Uniform Commercial Code      Financing Statements in Washington, D.C. in respect of certain of the      Finance Documents, and fees consequent thereto, it is not necessary for      the legality, validity, enforceability or admissibility into evidence of      this Agreement or any other Finance Document that any of them or any      document relating thereto be registered, filed recorded or enrolled with      any court or authority in any relevant jurisdiction or that any stamp,      registration or similar taxes be paid on or in relation to this Agreement      or any of the other FinanceDocuments. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 9.8 | No      default.  No Event of Default or Potential Event of      Default has occurred and is continuing and there are no incipient or other      defaults under any other agreements of any  Obligor. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 9.9 | Information.  All      financial and other information which has been provided in writing by or      on behalf of each of the Obligors to any of the Credit Parties in      connection with any Finance Document was true and accurate at the time it      was given, there are no other facts or matters the omission of which would      have made or make any such information false or misleading and there has      been no material adverse change in the financial condition, operations or      business prospects of any of the Obligors since the date on which such      information was provided. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 9.10 | No      litigation.  No legal or administrative action involving      any Obligor (including any action relating to any alleged or actual breach      of the ISM Code or ISPS Code or any Environmental Law) has been commenced      or taken or, to any Obligor’s knowledge, is likely to be commenced or      taken which, in either case, would be likely to have a material adverse      effect on the business, assets or financial condition of any Obligor or      which may affect the legality, validity, binding effect or enforceability      of the Finance Documents. |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 9.11 | ISM Code and ISPS Code      compliance.  Each Borrower has obtained or will obtain or      will cause the Approved Manager (technical) to obtain all necessary ISM      Code Documentation in connection with the Ship owned by it and its      operation and will be or will cause the Ship owned by it and the Approved      Manager to be in full compliance with the ISM Code and the ISPS      Code. |
|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 9.12 | Validity and completeness of      each Bareboat Charter; delivery of each Ship under the relevant Bareboat      Charter. |
|------|--------------------------------------------------------------------------------------------------------------------------|

| (a) | Each      Borrower has entered into the Bareboat Charter to which it is a party, and      to the best knowledge of such Borrower, each such Bareboat Charter is in      full force and effect (subject to the delivery of the relevant Ship under      the relevant Bareboat Charter and the relevant Memorandum of Three Party      Agreement), and true and complete copies thereof, together with all      agreements, instruments and other documents delivered in connection      therewith and amendments thereto (including the relevant Memorandum of      Three Party Agreement), have been furnished to the Facility Agent and the      Lenders. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | Subject      to the terms of the relevant Memorandum of Three Party Agreement, each      Bareboat Charter constitutes valid, binding and enforceable obligations of      the parties thereto in accordance with its  terms. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (c) | Except      for the relevant Memorandum of Three Party Agreement in respect of each      Bareboat Charter, no amendments or additions to the Bareboat Charters have      been or will be agreed nor have the parties thereto waived any of their      respective rights thereunder save as notified to the Facility Agent in      writing. |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (d) | There      is no default on the part of the relevant Borrower or, to the best      knowledge of such Borrower, on the part of the relevant Bareboat Charterer      with respect to the relevant Bareboat Charter, and there is no accrued      right of any party thereto to terminate any Bareboat    Charter. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (e) | Each      Ship will on the Actual Drawdown Date be delivered by the relevant      Borrower to and accepted by the relevant Bareboat Charterer under the      relevant Bareboat Charter. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 9.13 | Intentionally      omitted. |
|------|-----------------------------|

| 9.14. | Margin      Stock.  None of the Obligors is engaged in the business      of extending credit for the purpose of purchasing or carrying Margin Stock      and no proceeds of the Loan will be used to buy or carry any Margin Stock      or to extend credit to others for the purpose of buying or carrying any      Margin Stock. |
|-------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 9.15. | Compliance with Environmental      Law; Environmentally Sensitive Material.  Except to the      extent the following could not reasonably be expected to have a material      adverse effect on the business, assets or financial condition of the      Obligors or which may affect the legality, validity, binding effect or      enforceability of the FinanceDocuments: |
|-------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (a) | the      operations and properties of each Obligor complies with all Environmental      Law, all necessary Environmental Permits have been obtained and are in      effect for the operations and properties of the Obligors and each Obligor      is in compliance in all material respects with all such Environmental      Permits; and |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | none      of the Obligors has been notified in writing by any person that it or any      of its Affiliates is potentially liable for the remedial or other costs      with respect to treatment, storage, disposal, release, arrangement for      disposal or transportation of any Environmentally Sensitive Material,      except for costs incurred in the ordinary course of business with respect      to treatment, storage, disposal or transportation of such Environmentally      Sensitive Material. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 9.16. | Subsidiaries; Ownership of      Borrowers; Ownership of Westbrook.  None of the Borrowers      has any subsidiaries.  All of the outstanding equity of the      Borrowers has been validly issued, is fully paid, non-assessable and free      and clear of all liens and is owned beneficially and of record by      Westbrook.  All of the outstanding equity of Westbrook has been      validly issued, is fully paid, non-assessable and free and clear of all      liens and is owned beneficially and of record by the      Guarantor. |
|-------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 9.17. | Investment Company, Holding      Company, etc.  None of the Obligors is (i) an “investment      company,” or an “affiliated person” of, or “promoter” or “principal      underwriter” for, an “investment company,” as such terms are defined in      the Investment Company Act of 1940, as amended, or (ii) a “holding      company” or a “subsidiary company” of a “holding company” or an affiliate      of a “holding company” or of a “subsidiary company” of a “holding company”      or a “public utility” within the meaning of the Public Utility Holding      Company of 1935, as amended, or (iii) a “public utility” within the      meaning of the Federal Power Act of 1920, as  amended. |
|-------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 9.18. | Asset Control None of      the Obligors is a “national” of any “designated foreign country”, within      the meaning of the Foreign Assets Control Regulations or the Cuban Asset      Control Regulations of the U.S. Treasury Department, 31 C.F.R., Subtitle      B, Chapter V, as amended, or a “specially designated national” listed by      the Office of Foreign Assets Control (“OFAC”), the U.S.      Department of the Treasury, or any regulations or rulings issued      thereunder.  Neither the making of the Advance nor the use of      the proceeds thereof nor the performance by the Obligors of their      obligations under any of the Finance Documents to which it is a party      violates any statute, regulation or executive order restricting loans to,      investments in, or the export of assets to, foreign countries or entities      doing business there. |
|-------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 9.19. | ERISA.  None      of the Obligors has ever established or maintained any employee benefit      plan subject to Title IV of the Employee Retirement Income Security Act of      1974, as amended. |
|-------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 9.20. | Use of      Proceeds.  The Borrowers are using the proceeds of the      Loan only for the purposes stated in the preamble to this      Agreement. |
|-------|-------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 9.21. | Ownership of the      Ships.  The Borrowers are or will be on      the Actual Drawdown Date the sole owner of the whole of the      Ships. |
|-------|-----------------------------------------------------------------------------------------------------------------------------------------------------------|

| 9.22 | Place of      Business.  The chief place of business of each Obligor      and the office where the records of each Obligor are kept is located      at: |
|------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.1 | Affirmative      covenants.  From the date of this Agreement and      throughout the Security Period (unless otherwise    specified): |
|------|-------------------------------------------------------------------------------------------------------------------------------------------------|

| (a) | each      Obligor shall duly observe and perform its obligations under this      Agreement, the other Finance Documents to which it is a party, and the      Bareboat Charter and Memorandum of Three Party Agreement to which it is a      party, and each Obligor shall promptly notify the Agent of (i) any      material default by any party to the Bareboat Charter or Memorandum of      Three Party Agreement to which it is a party, (ii) any material      interruption in the performance of the Bareboat Charter to which it is a      party, whether or not the same constitutes a default thereunder, and (iii)      any significant damage or injury caused by or to a  Ship; |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | each      Obligor shall promptly inform the Facility Agent, upon becoming aware of      the same, of the occurrence of an Event of Default or of any Potential      Event of Default or any other event (including any litigation) which might      adversely affect its ability to perform its obligations under this      Agreement or any of the other Finance Documents to which it is a party or      its respective Bareboat Charter and Memorandum of Three Party      Agreement; |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (c) | each      Borrower shall be duly qualified and in goodstanding as a foreign maritime      entity under the law of the Republic of Liberia for so long as the Ship      owned by it is registered under Liberianflag; |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (d) | each      Obligor shall obtain or cause to be obtained, maintain in full force and      effect and comply with the conditions and restrictions (if any) imposed in      connection with, every consent and do all other acts and things, which may      from time to time be necessary or required for the continued due      performance of all their obligations under this Agreement and the other      Finance Documents to which it is a party or its respective Bareboat      Charter and Memorandum of Three Party Agreement, and shall deliver a copy      of all such consents to the Facility Agent promptly upon its      request; |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (e) | each      Obligor shall comply in all material respects with all applicable federal,      state, local and foreign laws, ordinances, rules, orders and regulations      now in force or hereafter enacted, including, without limitation, all      Environmental Laws and regulations relating to thereto, the failure to      comply with which would be likely to have a material adverse effect on the      business, assets or financial condition of such Obligor or affect the      legality, validity, binding effect or enforceability of the Finance      Documents to which such borrower is aparty; |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (f) | each      Obligor shall keep proper books of record and account, in which full and      materially correct entries shall be made of all financial transactions and      the assets and business of such Obligor in accordance with accounting      principles and practices acceptable to the Facility Agent, and the      Facility Agent shall have the right to examine the books and records of      the Obligors wherever the same may be kept from time to time as it sees      fit, in its sole discretion, or to cause an examination to be made by a      firm of accountants selected by it; |
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| (g) | [intentionally      omitted]; |
|-----|-------------------------------|

| (h) | the      Guarantor shall deliver to the FacilityAgent: |
|-----|--------------------------------------------------------|

|   | (i) | its      quarterly and annual financial statements and other reports of material      events as soon as practicable but not later than 10 Business Days after      the Guarantor files such financial statements on Forms 10-Q and 10-K and      reports on Form 8-K with the United States Securities and Exchange      Commission (but in no event later than: (1) 120 days after the end of its      fiscal year with respect to its annual financial statements and (2) 90      days after the end of each fiscalquarter); |
|--------|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (ii) | together      with its annual financial statements, reports of and/or updates on all      off-balance sheet financings and time charter hire commitments of the      Guarantor; |
|--------|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (iii) | together      with its quarterly and annual financial statements, a Compliance      Certificate; and |
|--------|-------|------------------------------------------------------------------------------------------------------|

|   | (iv) | such      other financial statements, annual budgets, projections and reports as may      be reasonably requested by the Facility Agent, each to be in such form as      the Facility Agent may reasonablyrequest; |
|--------|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (i) | each      Obligor shall prepare and timely file all tax returns required to be filed      by it and pay and discharge all taxes imposed upon it or in respect of any      of its property and assets before the same shall become in default, as      well as all lawful claims (including, without limitation, claims for      labor, materials and supplies) which, if unpaid, might become a lien or      charge upon the Collateral or any part thereof, except in each case, for      any such taxes (i) as are being contested in good faith by appropriate      proceedings or (ii) the failure of which to pay or discharge would not be      likely to have a material adverse effect on the business, assets or      financial condition of such Obligor or to affect the legality, validity,      binding effect or enforceability of the Finance  Documents; |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (j) | each      Borrower shall permit any person designated by the Facility Agent for that      purpose to visit and inspect the Ship owned by it, at the cost of the      Borrowers, at such times and so often as the Facility Agent may reasonably      require, provided that      (i) any visitation and inspection shall be done without undue      interference with the operation of the Ships, (ii) so long as no Event of      Default has occurred and is continuing, the Facility Agent shall not      exercise such visitation and inspection right more than one time per year      for the Ship and (iii) the person designated by the Facility Agent to      visit and inspect the Ship shall execute a release and waiver satisfactory      in form and substance to such Borrower, the relevant Bareboat Charterer      and the Facility Agent; |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (k) | each      Borrower shall procure that the Ship owned by it shall at all times be (i)      kept in a good and safe condition and state of repair that is consistent      with first-class ship ownership and management practice, (ii) in      compliance with all laws and regulations applicable to vessels (A)      registered under the law of the Approved Primary Flag and the Approved      Bareboat Flag in which the Ship is registered and (B) trading to any      jurisdiction to which the Ship may trade from time to time, (iii) managed      by the Approved Managers in accordance with vessel management agreements      acceptable to the Facility Agent, (iv) registered under the law of an      Approved Primary Flag and, so long as such Ship is subject to the Bareboat      Charter, registered under the law of the Approved Bareboat Flag, and (v)      classed with the Classification Society in the highest classification and      rating for vessels of the same age and type without any outstanding      conditions or recommendations affecting class (other than those for which      the time prescribed for curing the condition or recommendation has not      passed); |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (l) | each      Borrower shall procure that the operator of the Ship owned by it will      comply, in all material respects within the requisite applicable time      limits for vessels of the same type, size, age and flag as the Ship, with      the ISM Code and, in particular, without prejudice to the generality of      the foregoing, as and when required to do so by the ISM Code and at all      times thereafter, (i) procure that the operator of its Ship holds a valid      Document of Compliance and Safety Management Certificate, (ii) provide the      Facility Agent with copies of any such Document of Compliance and Safety      Management Certificate promptly following the issuance thereof and after      every renewal and (iii) procure that there is kept, on board its Ship a      copy of any such Document of Compliance and the original of any such      Safety Management Certificate; |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (m) | each      Borrower shall procure that: |
|-----|----------------------------------------|

|   | (i) | the      Ship owned by it maintains for the duration of the Security Period a valid      International Ship SecurityCertificate; |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------|

|   | (ii) | its      Ship’s security system and associated security equipment complies with the      applicable requirements of Chapter XI-2 of SOLAS and Part A of the ISPS      Code; and |
|--------|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (iii) | an      approved ship security plan is inplace; |
|--------|-------|-------------------------------------------------|

| (n) | each      Obligor shall do or cause to be done all things necessary to preserve and      keep its corporate existence in full force and effect and in      goodstanding; |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (o) | each      Borrower shall maintain insurance on the Ship owned by it as required by      the terms of the relevant Mortgage; |
|-----|-----------------------------------------------------------------------------------------------------------------------------|

| (p) | each      Borrower shall maintain insurance on any of its properties other than the      Ship owned by it, payable in United States Dollars, with responsible      companies, in such amounts and against such risks as is usually carried by      owners of similar businesses and properties in the same general areas in      which it operates, and as shall be satisfactory to the Majority      Lenders; |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (q) | except      to the extent the failure to do so could not reasonably be expected to      have a material adverse effect on the business, assets or financial      condition of the Obligors or which may affect the legality, validity,      binding effect or enforceability of the Finance Documents, each Obligor      shall maintain and preserve all of its properties that are used or useful      in the conduct of its business in good working order and condition,      ordinary wear and tear excepted; |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (r) | the      Borrowers shall use the proceeds of the Loan solely for the purposes      stated in the preamble to thisAgreement; |
|-----|-----------------------------------------------------------------------------------------------------------------------------|

| (s) | each      Obligor shall notify promptly the Facility Agent of any change in the      location of its chief place(s) of business or the office(s) where it keeps      records; |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (t) | each      Borrower shall furnish promptly to the Facility Agent each material      amendment or other modification to the Bareboat Charter and Memorandum of      Three Party Agreement in respect of the Ship owned by  it; |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (u) | each      Obligor shall take, or cause to be taken, such actions as may be      reasonably required to mitigate potential liability to it arising out of      pollution incidents or as may be reasonably required to protect the      interests of the Credit Parties with respect  thereto; |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (v) | each      Borrower shall cause all loans made by the Guarantor to it and all sums      and other obligations (financial or otherwise) owed by it to the relevant      Bareboat Charterer or the Approved Managers to be fully subordinated to      all Secured Liabilities of suchBorrower; |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (w) | the      Borrowers shall procure and deliver to the Facility Agent an annual      written appraisal report and such other interim valuations as the Facility      Agent may request, prepared by Broker, at the expense of the Borrowers,      setting forth the Fair Market Value of the  Ships; |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (x) | the      Guarantor shall be in compliance with the TBS Credit Facility Financial      Covenants regardless of whether the TBS Credit Facility is in effect or      not or whether the TBS Credit Facility Financial Covenants are in effect      or not (in which case the TBS Credit Facility Financial Covenants shall      apply in their last form before removal from the TBS Credit Facility), and      shall evidence such compliance by means of delivery of a quarterly      compliance certificate to the Facility Agent;  and |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (y) | from      time to time, at its expense, each Obligor shall duly execute and deliver      to the Facility Agent and the Security Trustee, such further documents and      assurances as the Majority Lenders, the Facility Agent or the Security      Trustee may request to effectuate the purposes of this Agreement, the      other Finance Documents or obtain the full benefit of any of the      Collateral. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2 | Negative      covenants.  Without the prior written consent of the      Majority Lenders, which consent shall not be unreasonably      withheld: |
|------|------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (a) | none      of the Borrowers will create, assume or permit to exist any Security      Interest whatsoever upon any of its properties or assets, whether now      owned or hereafter acquired, except for (i) any Security Interest created      by the Finance Documents to which it is a party, and (ii) any liens that      arise by operation of law in the ordinary course of business, the failure      of which to pay or discharge would not be likely to have a material      adverse effect on the business, assets or financial condition of such      Borroweror to affect the legality, validity, binding effect or      enforceability of the Finance Documents to which such Borrower is a      party; |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | none      of the Borrowers will sell, transfer or lease (except for its respective      Bareboat Charter), all of or a substantial portion of its properties and      assets, or enter into any transaction of merger or consolidation or      liquidate, windup or dissolve itself (or suffer any liquidation or      dissolution), unless: |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (i) | immediately      after giving effect to such transaction, no Event of Default shall have      occurred and be continuing; and |
|--------|-----|-------------------------------------------------------------------------------------------------------------------------------|

|   | (ii) | with      respect to any such sale, transfer, lease or disposition or transaction of      merger or consolidation, the purchaser, transferee or surviving company      (as the case may be) is reasonably acceptable to the Majority Lenders and      assumes all obligations and liabilities (including, without limitation,      any obligations or liabilities under the Finance Documents) of the seller,      transferor or non-surviving entity (as the case may be), such assumption      of obligations and liabilities to be in form and substance satisfactory to      the Majority Lenders; |
|--------|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (c) | none      of the Borrowers will enter into any transaction or series of related      transactions, whether or not in the ordinary course of business, with any      Affiliate, other than on terms and conditions substantially as favorable      to such person as would be obtainable by such person at the time in a      comparable arm’s-length transaction with a person other than an Affiliate,      provided that the      foregoing shall not prohibit or prevent the pooling and sharing of      Earnings by the Borrowers; |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (d) | none      of the Borrowers will change the nature of its business or commence any      business otherwise than in connection with, or for the purpose of,      operating the Ship owned by it; |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (e) | none      of the Borrowers will transfer or change or permit the transfer or change      of the flag of the Ship owned by it from the Approved Primary Flag in      which such Ship is registered on the Actual Drawdown Date (provided that each Ship      may be bareboat registered under the Approved Bareboat Flag by the      relevant Bareboat Charterer pursuant to the terms of the relevant Bareboat      Charter), change the classification or the Classification Society of the      Ship owned by it, or do or allow to be done anything as a result of which      such registration or classification might be imperiled or      cancelled; |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (f) | none      of the Borrowers will change or permit a change of the Approved Managers      for the Ship owned by it or agree or consent to any material amendment or      other modification of the terms of any of technical or commercial      management agreements relating to the Ship owned by it, including any      increase in the rate of compensation payable  thereunder; |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (g) | none      of the Borrowers will permit any act, event or circumstance that would      result in Westbrook holding directly less than 100% of such Borrower’s      equity and the Guarantor will not permit any act, event or circumstance      that would result in the Guarantor holding directly less than 100% of      Westbrook; |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (h) | none      of the Borrowers will incur any Financial Indebtedness other than (i) the      Loan, (ii) in the usual course of business, (iii) as permitted by the      Finance Documents, and (iv) Financial Indebtedness that is fully      subordinated to the Loan; |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (i) | if      an Event of Default shall have occurred and so long as such Event of      Default shall be continuing, none of the Borrowers shall declare or pay      any dividends or return any capital to any equity holder or authorize or      make any other distribution, payment or delivery of property or cash to      any equity holder as such, or redeem, retire, purchase or otherwise      acquire, directly or indirectly, for value, any share of any class of its      capital stock or other form of equity interest (or require any rights,      options or warrants relating thereto but not including convertible debt)      now or hereafter outstanding, or repay any subordinated loans or set aside      any funds for any of the foregoingpurposes; |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (j) | none      of the Borrowers will increase its capital by way of the creation of      preference securities, further common or ordinary securities or otherwise      howsoever, or create any new class of equity; none of the Borrowers will      permit any act, event or circumstance that would result in Westbrook      owning beneficially and of record less than 100% of the equity of each of      the Borrowers; and the Guarantor shall not sell, transfer, pledge, assign      or otherwise convey or dispose of any of the share capital of      Westbrook; |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (k) | none      of the Borrowers shall permit any material amendment of or other      modification to the Bareboat Charter or Memorandum of Three Party      Agreement to which it is a party; |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (l) | none      of the Borrowers will make any loan or advance to, make any investment in,      or enter into any working capital maintenance or similar agreement with      respect to any person, whether by acquisition of stock or indebtedness, by      loan, guarantee or otherwise; |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (m) | none      of the Borrowers will acquire any capital assets (including any vessel      other than the Ship owned by it) by purchase, charter or otherwise; provided that for the      avoidance of doubt nothing in this Clause 10.2(m) shall prevent or be      deemed to prevent capital improvements being made to the Ship owned by      it; |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (n) | none      of the Borrowers will enter into any arrangements, directly or indirectly,      with any person whereby it shall sell or transfer any property, whether      real or personal, and used and useful in its business, whether now owned      or hereafter acquired, if it, at the time of such sale or disposition,      intends to lease or otherwise acquire the right to use or possess (except      by purchase) such property or like property for a substantially similar      purpose; |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (o) | none      of the Borrowers shall make or permit any change in accounting policies      affecting (i) the presentation of financial statements or (ii) reporting      practices, except in either case in accordance with accounting principles      and practices acceptable to the FacilityAgent; |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (p) | none      of the Obligors shall change the jurisdiction of its formation or amend      its constitutional documents except in connection with a merger or      consolidation that is not prohibited by the terms of Clause 10.2(b);      or |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (q) | none      of the Borrowers shall permit the Ship owned by such Borrower to be      employed by a person (other than an Affiliate) if the net time charter      equivalent rate of such employment is less than $14,000 per day and the      Ship is contracted for such employment for a period equal to or in excess      of 18 months. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (a) | If,      at any time, the aggregate Fair Market Value of the Ships shall be less      than 135% of the unpaid principal amount of the Loan (the “Collateral Maintenance      Ratio”), the Facility Agent shall have the right to require the      Borrowers, within 30 Business Days of the date of the written demand of      the Facility Agent, to either (x) prepay the Loan in such amount as may be      necessary to cause such aggregate Fair Market Value of the Ships to equal      or exceed 135% of the unpaid principal amount of the Loan or (y) provide      such additional Collateral as may be acceptable to the Facility Agent in      its sole reasonable discretion so that aggregate Fair Market Value of the      Ships and such additional Collateral equals or exceeds 135% of the unpaid      principal amount of the Loan, and the Borrowers hereby agree to comply      with any such written demand made by the Facility  Agent. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | Any      prepayment made pursuant to this Clause 10.3 shall be applied to the      remaining repayment installments of principal and interest in inverse      order of maturity, may not be re-borrowed, and shall be subject to the      requirements of Clause 7.8, provided that any      prepayment made pursuant to this Clause 10.3 shall not be subject to a      prepayment penalty under Clause7.8(c). |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.4 | Recognition by Philippine      Maritime Industry Authority.  Each Borrower shall with      respect to the Ship owned by it: |
|------|---------------------------------------------------------------------------------------------------------------------------------------|

| (a) | cause      a cautionary notice with respect to the existence of the Mortgage on such      Ship to be filed on the Actual Drawdown Date, or as soon thereafter as is      feasible, in the bareboat registry of the Philippine Maritime Industry      Authority (the “Bareboat      Registry”), such notice to be in form and substance acceptable to      the Facility Agent; and |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | deliver      to the Facility Agent as soon as possible, but in no event later than 60      days, following the Actual Drawdown Date, evidence acceptable to the      Facility Agent that the Philippine Maritime Industry Authority has      recognized the existence of the Mortgage with respect such Ship and that      such Mortgage is governed by the law of the Republic of Liberia, and has      duly noted the same in the BareboatRegistry. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.5 | Deletion from Philippine      Bareboat Registry.  Unless the Facility Agent, acting      upon the instruction of the Majority Lenders, shall otherwise agree, upon      termination of a Bareboat Charter, the Borrower that owns the affected      Ship shall: |
|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (a) | cause      the cancellation and deletion of such Ship from the Philippine flag, and      the Facility Agent shall be entitled to do all such acts and things in the      name of the Borrower that owns such Ship and the relevant Bareboat      Charterer, or either of them, as may be required to effect such      cancellation and deletion and to comply with any requirements of the      Philippine Maritime Industry Authority for the purpose of ensuring that      the registration of such Ship under Liberian law is valid in every      respect; and |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | deliver      or cause to be delivered to the Facility Agent or its designee the      following documents, in each case in form and substance acceptable to the      Facility Agent: |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (i) | a      certificate of deletion in respect of such Ship from the Philippine      Maritime Industry Authority; |
|--------|-----|--------------------------------------------------------------------------------------------------------------|

|   | (ii) | the      original Temporary Certificate of Vessel Registry issued for such Ship by      the Philippine Maritime IndustryAuthority; |
|--------|------|------------------------------------------------------------------------------------------------------------------------------------|

|   | (iii) | the      original of each certificate issued by any governmental entity of the      Republic of the Philippines, including the certificate of the National      Telecommunications Commission of the Republic of the Philippines on such      Ship’s call sign and all SOLAScertificates; |
|--------|-------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (iv) | an      original certificate issued the Bureau of Internal Revenue of the Republic      of the Philippines that all applicable withholding taxes shall have been      paid; and |
|--------|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (v) | such      other documents and instruments as may be necessary or advisable to effect      such cancellation and deletion and to comply with any requirements of the      Philippine Maritime Industry Authority for the purpose of ensuring that      the registration of such Ship under Liberian law is valid in every      respect. |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 11.1 | Currency and method of      payments.  All payments to be made by the Borrowers under      the Finance Documents to which it is a party shall be made to the Payment      Agent: |
|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | in      same day Dollar funds settled through the New York Clearing House      Interbank Payments System (or in such other Dollar funds and/or settled in      such other manner as the Facility Agent shall specify as being customary      at the time for the settlement of international transactions of the type      contemplated by this Agreement);and |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (c) | at      JP Morgan Chase Manhattan Bank, New York, ABA No. 021000021, SWIFT:      CHASUS33, for credit to Bank of Ireland Global Markets (Account No.      0011015815), SWIFT: BIGTIE2D, Reference: Corporate Loans Administration –      TBS Int., or to such other account with such other bank as the Payment      Agent may from time to time notify to the  Borrowers. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 11.2 | Payment on non-Business      Day.  If any payment by a Borrower under the Finance      Documents to which it is a party would otherwise fall due on a day which      is not a Business Day: |
|------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | if      the next succeeding Business Day falls in the next calendar month, the due      date shall be brought forward to the immediately preceding Business      Day; |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 11.3 | Basis for calculation of      periodic payments.  All interest and commitment fee and      any other payments under any Finance Document which are of an annual or      periodic nature shall accrue from day to day and shall be calculated on      the basis of the actual number of days elapsed and a 360 day      year. |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (a) | any      amount received by the Payment Agent under a Finance Document for      distribution or remittance to a Credit Party shall be made available by      the Payment Agent to that Credit Party by payment, with funds having the      same value as the funds received, to such account as such Credit Party may      have notified to the Payment Agent not less than five (5) Business Days      previously; and |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | amounts      to be applied in satisfying amounts of a particular category which are due      to the Lenders generally shall be distributed by the Agent to each Lender      pro rata to the      amount in that category which is due toit. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 11.5 | Permitted deductions by Payment      Agent.  Notwithstanding any other provision of this      Agreement or any other Finance Document, the Payment Agent may, before      making an amount available to a Credit Party, deduct and withhold from      that amount any sum which is then due and payable to the Payment Agent      from that Credit Party under any Finance Document or any sum which the      Payment Agent is then entitled under any Finance Document to require that      Lender to pay on demand. |
|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 11.6 | Agent only obliged to pay when      monies received.  Notwithstanding any other provision of      this Agreement or any other Finance Document, the Payment Agent shall not      be obliged to make available to the Borrowers or any Credit Party any sum      which the Payment Agent is expecting to receive for remittance or      distribution to the Borrowers or that Credit Party until the Payment Agent      has satisfied itself that it has received that  sum. |
|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 11.7 | Refund to Payment Agent of      monies not received. Except as is otherwise provided in Clause      3.4(b) of this Agreement, if and to the extent that the Payment Agent      makes available a sum to the Borrowers or a Credit Party, without first      having received that sum, the Borrowers or (as the case may be) the Credit      Party concerned shall, on demand: |
|------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | pay      to the Payment Agent the amount (as certified by the Payment Agent) which      will indemnify the Payment Agent against any funding or other loss,      liability or expense incurred by the Payment Agent as a result of making      the sum available before receivingit. |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 11.8 | Payment Agent may assume      receipt.  Clause 11.7 shall not affect any claim which      the Payment Agent has under the law of restitution, and applies      irrespective of whether the Payment Agent had any form of notice that it      had not received the sum which it made available (except an express notice      from a Lender that it will not fund its Ratable Portion of the      Advance). |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 11.9 | Credit Party      accounts.  Each Credit Party (other than the Swap Banks)      shall maintain accounts showing the amounts owing to it by the Borrowers      under the Finance Documents and all payments in respect of those amounts      made by the Borrowers. |
|------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 11.10 | Payment Agent’s memorandum      account.  The Payment Agent shall maintain a memorandum      account showing the amounts advanced by the Lenders and all other sums      owing to the Payment Agent, the Security Trustee and each Lender from the      Borrowers under the Finance Documents and all payments in respect of those      amounts made by the Borrowers. |
|-------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 11.11 | Accounts prima facie      evidence.  If any accounts maintained under Clauses 12.9      and 12.10 show an amount to be owing by the Borrowers to a Credit Party,      those accounts shall be prima facie evidence that that amount is owing to      that Credit Party. |
|-------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 12.1 | Normal order of      application.  Except as any Finance Document may      otherwise provide, any sums which are received or recovered by the Payment      Agent, the Facility Agent or the Security Trustee under or by virtue of      any Finance Document shall beapplied: |
|------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 12.2 | Application of credit      balances.  A Lender may with seven (7) days prior notice      or without prior notice if an Event of Default has occurred and is      continuing: |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (a) | apply      any balance (whether or not then due) which at any time stands to the      credit of any account in the name of a Borrower at any office of such      Lender in any country in or towards satisfaction of any sum then due from      the Borrowers to such Lender under any of the Finance Documents;      and |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (ii) | convert      or translate all or any part of a deposit or other credit balance into      Dollars; |
|--------|------|---------------------------------------------------------------------------------------------------|

|   | (iii) | enter      into any other transaction or make any entry with regard to the credit      balance which such Lender considersappropriate. |
|--------|-------|----------------------------------------------------------------------------------------------------------------------------------------|

| 12.3 | Existing rights      unaffected.  A Lender shall not be obliged to exercise      any of its rights under Clause 12.2; and those rights shall be without      prejudice and in addition to any right of set-off, combination of      accounts, charge, lien or other right or remedy to which such Lender is      entitled (whether under the general law or any  document). |
|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 12.4 | Payments in excess of ratable      share.  If any Lender shall obtain any payment (whether      voluntary, involuntary, through the exercise of any right of set-off,      counterclaim or otherwise) on account of its portion of the Loan and in      excess of its ratable share of payments on account of the Loan obtained by      all the Lenders, such Lender shall forthwith purchase from the other      Lenders such participation in their respective portions of the Loan as      shall be necessary to share the excess payment ratably with each of them;      provided that if      all or any portion of such excess payment is thereafter recovered from      such purchasing Lender, such purchase from each Lender shall be rescinded      and such Lender shall repay to the purchasing Lender the purchase price to      the extent of such recovery together with an amount equal to such Lender’s      ratable share (according to the proportion of (a) the amount of such      Lender’s required repayment to (b) the total amount so recovered from the      purchasing Lender) of any interest or other amount paid or payable by the      purchasing Lender in respect of the total amount so      recovered.  Each Borrower agrees that any Lender so purchasing a      participation from another Lender pursuant to this Clause 12.4 may, to the      fullest extent permitted by law, exercise all of its rights of payment      (including the right of set-off) with respect to such participation as      fully as if such Lender were the direct creditor of the Borrowers in the      amount of such participation.  Notwithstanding the preceding      sentences of this Clause 12.4, any Lender which shall have commenced or      joined (as a plaintiff) in an action or proceeding in any court to recover      sums due to it under this Agreement or any other Finance Document and      pursuant to a judgment obtained therein or a settlement or compromise of      that action or proceeding shall have received any amount, shall not be      required to share any proportion of that amount with a Lender which has      the legal right to, but does not, join such action or proceeding or      commence and diligently prosecute a separate action or proceeding to      enforce its rights in the same or another court.  Each Lender      exercising or contemplating exercising any rights giving rise to a receipt      or receiving any payment of the type referred to in this Clause 12.4 or      instituting legal proceedings to recover sums owing to it under this      Agreement shall, as soon as reasonably practicable thereafter, give notice      thereof to the Facility Agent who shall give notice to the other      Lenders. |
|------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (a) | any      sum payable under this Agreement or any of the other Finance Documents is      not paid when due or, only in the case of sums payable on demand, when      first demanded; or |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | an      Obligor or any other party (other than a Credit Party) commits any      material breach of or fails to observe any of its material obligations,      covenants or undertakings under this Agreement or any of the other Finance      Documents, or an event of default, or an event or circumstance which, with      the giving of any notice, the lapse of time or both would constitute an      event of default, has occurred under any of the other Finance Documents,      and such default continues unremedied for 10 Business Days after written      notice from the Facility Agent requesting action to remedy the same;      or |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (c) | any      Financial Indebtedness of an Obligor is not paid when due or, only in the      case of sums payable on demand, when first demanded, and such default      remains uncured for 30 days, except for any such Financial Indebtedness      which is being contested by such Obligor in good faith and through      appropriate proceedings; or |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (d) | any      representation or warranty made by an Obligor or any other party (other      than a Credit Party) in or pursuant to this Agreement or any of the other      Finance Documents or in a Bareboat Charter or Memorandum of Three Party      Agreement shall prove to have been incorrect in any material respect when      made or deemed made or confirmed; |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (e) | any      of the consents referred to in Clause 9.3 is modified in a manner      unacceptable to the Majority Lenders or is not granted or is revoked or      terminated or expires and is not renewed or otherwise ceases to be in full      force and effect; or |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (f) | an      Obligor suspends payment of its debts or is unable or admits inability to      pay its debts as they fall due or shall make a general assignment for the      benefit of creditors or any proceeding shall be instituted by or against      an Obligor seeking to adjudicate it a bankrupt or insolvent, or seeking      liquidation, winding up, reorganization, arrangement, adjustment,      protection, relief, or composition of it or its debts under any law of any      relevant jurisdiction relating to bankruptcy, insolvency or reorganization      or relief of debtors, or seeking the entry of an order for relief or the      appointment of a receiver, trustee, custodian or other similar official      for it or for any substantial part of its property and, in the case of any      such proceeding instituted against it (but not instituted by it), and, in      the case of any such proceeding instituted against it (but not instituted      by it), either such proceeding shall remain undismissed or unstayed for a      period of 45 days, or any of the actions sought in such proceeding      (including, without limitation, the entry of an order for relief against,      or the appointment of a receiver, trustee, custodian or other similar      official for, it or for any substantial part of its property) shall occur;      or an Obligor shall take any company action to authorize any of the      actions set forth above in this Clause 13.1(f);  or |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (g) | the      occurrence of any act, event or circumstance which results in the      Guarantor owning, beneficially and of record, directly or indirectly, less      than 100% of the issued and outstanding equity of Westbrook or Westbrook      owning, beneficially and of record, directly or indirectly, less than 100%      of the issued and outstanding equity of a Borrower;  or |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (h) | an      Obligor ceases or threatens to cease to carry on its business;      or |
|-----|--------------------------------------------------------------------------------|

| (i) | all      or a material part of the undertakings, assets, rights or revenues of, or      shares or other ownership interest in, an Obligor are seized,      nationalized, expropriated or compulsorily acquired by or under authority      of any government; or |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (j) | a      creditor attaches or takes possession of, or a distress, execution,      sequestration or process (each an “arrest or attachment”)      is levied or enforced upon or sued out against, a material part of the      undertakings, assets, rights or revenues (the “assets”) of an Obligor      in relation to a claim by such creditor where such Obligor does not or      does not procure that such arrest or attachment is lifted, released or      expunged within 30 Business Days of such action being (A) instituted and      (B) notified to the Obligor; or |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (k) | a      Ship becomes a Total Loss and insurance proceeds are not collected or      received by the Security Trustee from the underwriters within 120 days of      the Total Loss Date; or |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (l) | in      the reasonable determination of the Majority Lenders, it becomes      impossible or unlawful for an Obligor or any other party thereto (other      than a Credit Party) to fulfill any of the covenants and obligations      required to be fulfilled as contained in any Finance Document or any of      the instruments granting or creating rights in any of the Collateral in      any material respect, or for a Credit Party to exercise any of the rights      or remedies vested in it under any Finance Document, any of the Collateral      or any of such instruments in any material  respect; |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (m) | there      occurs, in the reasonable opinion of the Majority Lenders, a material      adverse change in the financial condition of an Obligor;  or |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------|

| (n) | any      other event occurs or circumstance arises which, in the reasonable opinion      of the Majority Lenders, is likely materially and adversely to      affect: |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (i) | the      ability of an Obligor or any other party (other than a Credit Party) to      perform all or any of its respective obligations under or otherwise to      comply with the terms of this Agreement or any of the other Finance      Documents to which it is a party;or |
|--------|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (o) | any      party to a Bareboat Charter or a Memorandum of Three Party Agreement      commits any material breach of or fails to observe any of its material      obligations, covenants or undertakings under such Bareboat Charter or      Memorandum of Three Party Agreement, or an event of default, or an event      or circumstance which, with the giving of any notice, the lapse of time or      both would constitute an event of default, has occurred under such      Bareboat Charter or Memorandum of Three Party Agreement;  or |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (p) | the      results of any inspection of a Ship are deemed unsatisfactory by the      Facility Agent in its sole, reasonable discretion;  or |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------|

| (q) | the      Guarantor fails to comply with the TBS Credit Facility Financial      Covenants; or |
|-----|----------------------------------------------------------------------------------------------|

| (r) | an      event of default, or an event or circumstance which, with the giving of      any notice, the lapse of time or both would constitute an event of      default, has occurred under any contract or agreement (other than the      Finance Documents) to which an Obligor is a  party. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 13.2 | Actions following an Event of      Default.  On, or at any time after, the occurrence of an      Event of Default the Facility Agentmay: |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------|

| (a) | serve      on the Borrowers a notice stating that all obligations of the Lenders to      the Borrowers under this Agreement are terminated;  and/or |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | serve      on the Borrowers a notice stating that the Loan, all accrued interest and      all other amounts accrued or owing under this Agreement are immediately      due and payable or are due and payable on demand; provided that in the      case of an Event of Default under any of Clauses 13.1 (f), the Loan and      all accrued interest and other amounts accrued or owing hereunder shall be      deemed immediately due and payable without notice or demand therefor;      and/or |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (c) | change      the Approved Managers; and/or |
|-----|-------------------------------------------|

| (d) | take      any other action which, as a result of the Event of Default or any notice      served under paragraph (a) or (b) above, a Credit Party is entitled to      take under any Finance Document or any applicable  law. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 13.3 | Termination of      obligations.  On the service of a notice under paragraph      (a) of Clause 13.2, all the obligations of the Lenders to the Borrowers      under this Agreement shallterminate. |
|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 13.4 | Acceleration of      Loan.  On the service of a notice under paragraph (b) of      Clause 13.2, the Loan, all accrued interest and all other amounts accrued      or owing from the Borrowers under this Agreement and every other Finance      Document shall become immediately due and payable or, as the case may be,      payable on demand, and the Security Trustee shall forthwith be entitled to      enforce the Security Interests created by this Agreement and any other      Finance Document in any manner available to it and in such sequence as the      Security Trustee may, in its absolute discretion,    determine. |
|------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 13.5 | Multiple notices; action      without notice.  The Facility Agent may serve notices      under paragraphs (a) and (b) of Clause 13.2 simultaneously or on different      dates and it may take any action referred to in that Clause if no such      notice is served or simultaneously with or at any time after the service      of both or either of such notices. |
|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (a) | to      the Facility Agent, a Facility Agent’s fee of $7,500 per annum, which      shall be non-refundable and payable upon the execution of this Agreement      and annually upon the anniversary of the execution of this      Agreement; |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | to      the Security Trustee, a Security Trustee’s fee of $7,500 per annum, which      shall be non-refundable and payable upon the execution of this Agreement      and annually upon the anniversary of the execution of this      Agreement; |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (c) | to      the Payment Agent, a Payment Agent’s fee of $10,000 per annum, which shall      be non-refundable and payable upon the execution of this Agreement and      annually upon the anniversary of the execution of this Agreement;      and |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (d) | to      each Lender, a commitment fee equal to 0.75% per annum of the undrawn      portion of the Commitment, payable monthly in arrears during the period      from (and including) the date of execution of this Agreement to the Actual      Drawdown Date. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 14.2 | Costs of negotiation,      preparation etc.  The Borrowers shall pay to the Facility      Agent on its demand the amount of all expenses incurred by the Facility      Agent or any other Credit Party in connection with the negotiation,      preparation, execution, registration or enforcement of any Finance      Document or any related document or with any transaction contemplated by a      Finance Document or a related document, including, without limitation, the      reasonable fees and disbursements of the Facility Agent’s legal counsel      and any local counsel retained bythem. |
|------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 14.3 | Costs of variations,      amendments, enforcement etc.  The Borrowers shall pay to      the Facility Agent, on the Facility Agent’s demand, the amount of all      expenses incurred by the Facility Agent in connection  with: |
|------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (a) | any      amendment or supplement to a Finance Document, or any proposal for such an      amendment to be made; |
|-----|----------------------------------------------------------------------------------------------------------------|

| (b) | any      consent or waiver by any Credit Party under or in connection with a      Finance Document, or any request for such a consent or    waiver; |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------|

| (c) | the      valuation of or any other matter relating to the Collateral;      or |
|-----|-------------------------------------------------------------------------------|

| (d) | any      step taken by a Credit Party with a view to the protection, exercise or      enforcement of any right or Security Interest created by a Finance      Document or for any similarpurpose. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 14.4 | Documentary      taxes.  The Borrowers shall promptly pay any tax payable      on or by reference to any Finance Document, and shall, on demand, fully      indemnify any Credit Party against any liabilities and expenses resulting      from any failure or delay by the Borrowers to pay such a    tax. |
|------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 15.1 | Indemnities regarding borrowing      and repayment of Loan.  The Borrowers shall fully      indemnify a Credit Party on such Credit Party’s first demand in respect of      all reasonable expenses, liabilities and losses which are incurred by such      Credit Party, or which such Credit Party reasonably and with due diligence      estimates that it will incur, as a result of or in connection      with: |
|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (a) | the      Advance not being borrowed on the Expected Drawdown Date specified in the      Drawdown Notice for any reason other than a default by the affected      Lender; |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | the      receipt or recovery of all or any part of the Loan or an overdue sum      otherwise than on the last day of an Interest Period or other relevant      period; |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (c) | any      failure (for whatever reason) by the Borrowers to make payment of any      amount due under a Finance Document on the due date or, if so payable, on      demand (after giving credit for any default interest paid by the Borrowers      on the amount concerned under Clause7); |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (d) | the      occurrence and/or continuance of an Event of Default or a Potential Event      of Default and/or the acceleration of repayment of the Loan under Clause      13; |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 15.2 | Breakage      costs.  Without limiting its generality, Clause 15.1      covers any liability, expense or loss incurred by a Credit      Party: |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------------|

| (a) | in      liquidating or employing deposits from third parties acquired or arranged      to fund or maintain all or any part of the Loan and/or any overdue amount      (or an aggregate amount which includes the Loan or any overdue amount);      and |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | in      terminating, or otherwise in connection with, any interest and/or currency      swap or any other transaction entered into (whether with another legal      entity or with another office or department of such Credit Party) to hedge      any exposure arising under this Agreement or that part which such Credit      Party determines is fairly attributable to this Agreement of the amount of      the liabilities, expenses or losses incurred by it in terminating, or      otherwise in connection with, a number of transactions of which this      Agreement is one. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | It      is understood and agreed that unless an Event of Default has occurred and      is continuing any gain realized by a Credit Party under Clause 15.2(b)      shall be for credit against the amount then due from the Borrowers to such      Credit Party. |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 15.3 | Miscellaneous      indemnities.  The Borrowers shall fully indemnify each      Credit Party in respect of all claims, demands, proceedings, liabilities,      taxes, losses and expenses of every kind (“liability items”)      which may be made or brought against, or incurred by, such Credit Party,      in any country, in relation to: |
|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (a) | any      action taken, or omitted or neglected to be taken, under or in connection      with any Finance Document by such Credit Party or by any receiver      appointed under a Finance Document; |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | any      other event, matter or question which occurs or arises at any time during      the Security Period and which has any connection with any payment or other      transaction relating to a Finance Document or any asset covered (or      previously covered) by a Security Interest created (or intended to be      created) by a Finance Document; |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 15.4 | Other      indemnities.  The Borrowers further agree to fully      indemnify each Credit Party on any such Credit Party’s first demand in      respect of all reasonable expenses, liabilities and losses which are      incurred by such Credit Party, or which such Credit Party reasonably and      with due diligence estimates that it will incur, as a result of or in      connection with the enforcement (whether through negotiations, legal      proceedings or otherwise) of the Finance Documents and any other document      to be delivered hereunder. |
|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 15.5 | Currency      indemnity.  If any sum due from a Borrower to any of the      Credit Party under a Finance Document or under any order or judgment      relating to a Finance Document has to be converted from the currency in      which the Finance Document provided for the sum to be paid (the “Contractual Currency”)      into another currency (the “Payment Currency”) for      the purpose of: |
|------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (a) | making      or lodging any claim or proof against the Borrowers, whether in its      liquidation, any arrangement involving it or otherwise;  or |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------|

| 15.6 | Increased      costs.  If a Lender reasonably determines that compliance      with any law or regulation or any guideline or request from any central      bank or other governmental or monetary authority in regard to capital      adequacy (whether or not having the force of law) including, without      limitation, any guideline contemplated by the report dated July 1988      entitled “International Convergence of Capital Management and Capital      Standards” issued by the Bank Committee on Banking Regulations and      Supervisory Practices, in any case in which such law, regulation,      guideline or request became effective or was made after the date hereof,      has or would have the effect of reducing the rate of return on the capital      of, or maintained by, such Lender or any corporation controlling such      Lender as a consequence of such Lender making its Ratable Portion of the      Advance or Commitment hereunder and other commitments of this type, by      increasing the amount of capital required or expected to be maintained by      such Lender or any corporation controlling such Lender, to a level below      that which such Lender or any corporation controlling such Lender could      have achieved but for such adoption, effectiveness, change or compliance      (taking into account such Lender’s or such corporation’s policies with      respect to capital adequacy) then the Borrowers shall, from time to time,      pay such Lender, upon demand by such Lender made within 60 days after the      first date on which such Lender has actual knowledge that it is entitled      to make demand for payment under this Clause 15.6 of such reduction in      return, such additional amount as may be specified by such Lender as being      sufficient to compensate such Lender for such reduction in return, to the      extent that such Lender reasonably determines such reduction to be      attributable to the existence of such Lender’s commitment to lend      hereunder; provided that      if such Lender fails to so notify the Borrowers within such 60-day      period, such amounts shall commence accruing on such later date on which      such Lender notifies the Borrowers.  A certificate as to such      amounts submitted to the Borrowers by a Lender shall be conclusive and      binding for all purposes, absent manifesterror. |
|------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 16.1 | No      deductions.  All amounts due from the Obligors under a      Finance Document shall be paid: |
|------|---------------------------------------------------------------------------------------------------------------|

| (b) | free      and clear of any tax deduction except a tax deduction which the Borrowers      are required by law to make. |
|-----|-----------------------------------------------------------------------------------------------------------------------|

| 16.2 | Grossing-up for      taxes.  If an Obligor is required by law to make a tax      deduction from any payment: |
|------|------------------------------------------------------------------------------------------------------------------------|

| (a) | that      Obligor shall notify the Facility Agent as soon as it becomes aware of the      requirement; |
|-----|--------------------------------------------------------------------------------------------------------|

| (b) | that      Obligor shall pay the tax deducted to the appropriate taxation authority      promptly, and in any event before any fine or penalty    arises; |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------|

| (c) | the      amount due in respect of the payment shall be increased by the amount      necessary to ensure that each of the Lenders receives and retains (free      from any liability relating to the tax deduction) a net amount which,      after the tax deduction, is equal to the full amount which it would      otherwise have received. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 16.3 | Evidence of payment of      taxes.  Within 30 days after making any tax deduction,      the Obligors shall deliver to the Facility Agent documentary evidence      satisfactory to the Facility Agent that the tax had been paid to the      appropriate taxation authority. |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 16.4 | Exclusion of tax on overall net      income.  In this Clause 16 “tax deduction” means      any deduction or withholding for or on account of any present or future      tax except tax on a Lender’s overall net income imposed by a taxing      jurisdiction in which such Lender is organized, holds or books the Loan or      has a principal place of business. |
|------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 17.1 | Illegality.  This      Clause 17 applies if a Lender notifies the Borrowers that it has become,      or will with effect from a specified date,  become: |
|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (a) | unlawful      or prohibited as a result of the introduction of a new law, an amendment      to an existing law or a change in the manner in which an existing law is      or will be interpreted or applied;or |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | contrary      to, or inconsistent with, anyregulation, |
|-----|--------------------------------------------------------|

| 17.2 | Notification and effect of      illegality.  On a Lender notifying the Borrowers under      Clause 17.1, such Lender’s obligation to make available its Commitment      shall terminate; and thereupon or, if later, on the date specified in such      Lender’s notice under Clause 17.1 as the date on which the notified event      would become effective, the Borrowers shall prepay to such Lender that      portion of the Loan then due and payable to such Lender plus all amounts      otherwise payable under Clause 7.8. |
|------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 18.1 | Assignment by      Borrowers.  Except as permitted by Clause 10.2(b), no      Borrower may, without the consent of the Majority  Lenders: |
|------|-----------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | enter      into any merger, de-merger or other reorganization, or carry out any other      act, as a result of which any of its rights or liabilities under any      Finance Document would vest in, or pass to, another  person. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 18.2 | Assignments by      Lender. |
|------|-----------------------------|

| (a) | Each      Lender may at its own expense and with the consent of the Borrowers, such      consent not to be unreasonably withheld, assign to a bank or other entity      all or a portion of its rights and obligations under this Agreement      (including, without limitation, all or a portion of its Commitment or the      Advance(s) owing to it), provided      that: |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (i) | each      such assignment shall be of a uniform, and not a varying, percentage of      all rights and obligations under thisAgreement; |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------|

|   | (ii) | the      amount of the Commitment of the assigning Lender being assigned pursuant      to each such assignment (determined as of the date of the Assignment and      Acceptance with respect to such assignment) shall in no event be less than      $5,000,000 and shall be an integral multiple of $1,000,000 in excess      thereof, or shall be an assignment to another Lender or an assignment of      all of the assigning Lender’s rights and obligations      hereunder; |
|--------|------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (iii) | each      such assignment shall be to (x) another Lender or a financial Affiliate of      the assigning Lender or (y) to an Eligible  Assignee; |
|--------|-------|-------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (v) | at      the time of such assignment, no such assignment shall, without the consent      of the Borrowers, result in increased liability to the Borrowers under      this Agreement; and |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (v) | the      parties to each such assignment shall execute and deliver to the Facility      Agent, for its acceptance and recording in the Register, an Assignment and      Acceptance, together with a processing and recordation fee of $3,000 from      the assignee. |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Upon      such execution, delivery, acceptance and recording, from and after the      effective date specified in each Assignment and Acceptance, (x) the      assignee thereunder shall be a party hereto and, to the extent that rights      and obligations hereunder have been assigned to it pursuant to such      Assignment and Acceptance, have the rights and obligations of a Lender      hereunder and (y) the Lender assignor thereunder shall, to the extent that      rights and obligations hereunder have been assigned by it pursuant to such      Assignment and Acceptance, relinquish its rights and be released from its      further obligations under this Agreement (and, in the case of an      Assignment and Acceptance covering all or the remaining portion of an      assigning Lender’s rights and obligations under this Agreement, such      Lender shall cease to be a partyhereto). |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | By      executing and delivering an Assignment and Acceptance, the Lender assignor      thereunder and the assignee thereunder confirm to and agree with each      other and the other parties hereto asfollows: |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (i) | other      than as provided in such Assignment and Acceptance, such assigning Lender      makes no representation or warranty and assumes no responsibility with      respect to any statements, warranties or representations made in or in      connection with this Agreement or the execution, legality, validity,      enforceability, genuineness, sufficiency or value of this Agreement or any      other instrument or document furnished pursuant  hereto; |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (ii) | such      assigning Lender makes no representation or warranty and assumes no      responsibility with respect to the financial condition of any of the      Obligors or the performance or observance by any of the Obligors of any of      its obligations under this Agreement, any other Finance Document or any      other instrument or document furnished pursuant hereto or      thereto; |
|--------|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (iii) | such      assignee confirms that it has received a copy of this Agreement, together      with copies of such other documents and information as it has deemed      appropriate to make its own credit analysis and decision to enter into      such Assignment and Acceptance; |
|--------|-------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (iv) | such      assignee will, independently and without reliance upon the Facility Agent,      the Security Trustee or the Payment Agent, such assigning Lender or any      other Lender and based on such documents and information as it shall deem      appropriate at the time, continue to make its own credit decisions in      taking or not taking action under this  Agreement; |
|--------|------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (v) | such      assignee confirms that it is an Eligible Assignee or another Lender or a      financial Affiliate of the assigningLender; |
|--------|-----|-------------------------------------------------------------------------------------------------------------------------------------|

|   | (vi) | such      assignee appoints and authorizes the Facility Agent, the Security Trustee      and the Payment Agent to take such action on its behalf and to exercise      such powers under this Agreement as are delegated to such party by the      terms hereof, together with such powers as are reasonably incidental      thereto; |
|--------|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (vii) | such      assignee agrees that it will perform in accordance with their terms all of      the obligations which by the terms of this Agreement are required to be      performed by it as a Lender; and |
|--------|-------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (viii) | such      assigning Lender and such assignee represent and warrant that such      assignment is not in violation of any applicable laws, including      securities laws. |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (c) | The      Facility Agent shall maintain at its address referred to in Clause 20.2 a      copy of each Assignment and Acceptance delivered to and accepted by it and      a register for the recordation of the names and addresses of the Lenders      and the Commitment of, and principal amount of the Advances owing to, each      Lender from time to time (the “Register”).  The      entries in the Register shall be conclusive and binding for all purposes,      absent manifest error, and the Borrowers, the Facility Agent, the Payment      Agent, the Security Trustee and the Lenders may treat each person whose      name is recorded in the Register as a Lender hereunder for all purposes of      this Agreement.  The Register shall be available for inspection      by the Borrowers or any Lender at any reasonable time and from time to      time upon reasonable prior notice. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (d) | Upon      its receipt of an Assignment and Acceptance executed by an assigning      Lender and an assignee, the Facility Agent shall, if such Assignment and      Acceptance has been completed and is in substantially the form of Schedule      4 hereto, (i) accept such Assignment and Acceptance, (ii) record the      information contained therein in the Register and (iii) give prompt notice      thereof to the Borrowers and the other Credit  Parties. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (e) | Notwithstanding      any other provision set forth in this Agreement, any Lender may, at its      own expense, at any time create a security interest in all or any portion      of its rights under this Agreement (including, without limitation, the      Advances owing to it) in favor of any Federal Reserve Bank in accordance      with Regulation A of the Board of Governors of the Federal Reserve      System. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 18.3 | Rights of      assignee.  In respect of any breach of a warranty,      undertaking, condition or other provision of a Finance Document, or any      misrepresentation made in or in connection with a Finance Document, a      direct or indirect assignee of any of a Lender’s rights or interests under      or by virtue of the Finance Documents shall be entitled to recover damages      by reference to the loss incurred by that assignee as a result of the      breach or misrepresentation irrespective of whether the Lender would have      incurred a loss of that kind oramount. |
|------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 18.4 | Subrogation      assignment.  A Lender may assign, in any manner and on      terms agreed by it, all or any part of those rights to an insurer or      surety who has become subrogated tothem. |
|------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 18.5 | Participations.  Each      Lender may, at is own expense, without the Borrowers’ consent, sell      participations to one or more banks or other entities in or to all or a      portion of its rights and obligations under this Agreement (including      without limitation, all or a portion of its Commitment and the Advance(s)      owing to it); provided      that: |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (i) | such      Lender’s obligations under this Agreement (including, without limitation,      its Commitment to the Borrower hereunder) shall remain      unchanged; |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (ii) | such      Lender shall remain solely responsible to the other parties hereto for the      performance of such obligations; |
|--------|------|----------------------------------------------------------------------------------------------------------------------------|

| (iii) | such      Lender shall remain the Lender for all purposes of this      Agreement; |
|-------|-----------------------------------------------------------------------------------|

|   | (iv) | the      Borrowers, the Facility Agent, the Payment Agent, the Security Trustee and      the other Lenders shall continue to deal solely and directly with such      Lender in connection with such Lender’s rights and obligations under this      Agreement; and |
|--------|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (v) | no      participant under any such participation shall have any right to approve      any amendment or waiver of any provision of any Finance Document, or any      consent to any departure by an Obligor  therefrom. |
|--------|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 18.6 | Disclosure of      information.  The Lenders may disclose to a potential      assignee or sub-participant any information which the Lenders have      received in relation to the Obligors or their affairs under or in      connection with any Finance Document, provided that if the      information is clearly of a confidential nature the potential assignee or      sub-participant shall enter into a confidentiality    agreement. |
|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 18.7 | Change of lending      office.  A Lender may change its lending office by giving      notice to the Borrowers and the change shall become effective on the later      of: |
|------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | the      date, if any, specified in the notice as the date on which the change will      come into effect; |
|-----|------------------------------------------------------------------------------------------------------------|

|   | provided that such      change in lending office does not increase the Borrowers’ cost under this      Agreement. |
|--------|-------------------------------------------------------------------------------------------------------------------------|

| 19.1 | Variations, waivers      etc. |
|------|-------------------------------|

| (a) | A      document shall be effective to vary, waive, suspend or limit any provision      of a Finance Document, or a Credit Party’s rights or remedies under such a      provision or the general law, only if the document is signed, or      specifically agreed to by fax, by the relevant Obligor(s) and the relevant      Credit Party. |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | Except      as otherwise provided in this Agreement, this Agreement or any term hereof      may be amended, modified, waived, discharged or terminated only by an      instrument in writing, signed by the Majority Lenders or by the Facility      Agent acting with the consent of the Majority Lenders; provided that so long as      this Agreement remains in effect or there are any Designated Transactions      continuing, no amendment, modification or waiver shall, unless by an      instrument signed by all the Lenders or the Swap Banks, or by the Facility      Agent acting with the consent of all the Lenders and the Swap      Banks: |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (i) | increase      the Commitment of any Lender, or increase or extend the term, or extend      the time or waive any requirement for the reduction or termination, of the      Advance; |
|--------|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (iii) | reduce      the amount of any payment of principal thereof or the rate at which      interest is payable thereon or any fee is payable    hereunder; |
|--------|-------|------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (vi) | release      any Collateral, except as contemplated in this Agreement or by a Finance      Document; or |
|--------|------|---------------------------------------------------------------------------------------------------------|

| 19.2 | Exclusion of other or implied      variations.  Except for a document which satisfies the      requirements of Clause 19.1, no document, and no act, course of conduct,      failure or neglect to act, delay or acquiescence on the part of a Credit      Party (or any person acting on its behalf) shall result in such Credit      Party (or any person acting on its behalf) being taken to have varied,      waived, suspended or limited, or being precluded (permanently or      temporarily) from enforcing, relying on or  exercising: |
|------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (c) | a      breach by an Obligor of an obligation under a Finance Document or the      general law; or |
|-----|---------------------------------------------------------------------------------------------------|

| (d) | any      right or remedy conferred by any Finance Document or by the general      law; |
|-----|----------------------------------------------------------------------------------------|

| 20.1 | General.  Unless      otherwise specifically provided, any notice under or in connection with      any Finance Document shall be given by registered mail (with a copy by fax      sent the same day) or by fax; and references in the Finance Documents to      written notices, notices in writing and notices signed by particular      persons shall be construedaccordingly. |
|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (a) | a      notice which is delivered personally shall be deemed to be served, and      shall take effect, at the time when it is  delivered; |
|-----|------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | a      notice which is sent by post shall be deemed to be served, and shall take      effect, three (3) days after the date of posting;  and |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------|

| (c) | a      notice which is sent by fax shall be deemed to be served, and shall take      effect, two (2) hours after its successful transmission is      completed. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 20.4 | Service outside business      hours.  However, if under Clause 20.3 a notice would be      deemed to be served: |
|------|---------------------------------------------------------------------------------------------------------------------------|

| 20.5 | Illegible      notices.  Clauses 20.3 and 20.4 do not apply if the      recipient of a notice notifies the sender within one (1) hour after the      time at which the notice would otherwise be deemed to be served that the      notice has been received in a form which is illegible in a material      respect. |
|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 20.6 | Valid      notices.  A notice under or in connection with a Finance      Document shall not be invalid by reason that its contents or the manner of      serving it do not comply with the requirements of this Agreement or, where      appropriate, any other Finance Document under which it is served      if: |
|------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (a) | the      failure to serve it in accordance with the requirements of this Agreement      or other Finance Document, as the case may be, has not caused any party to      suffer any significant loss or prejudice;or |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | in      the case of incorrect and/or incomplete contents, it should have been      reasonably clear to the party on which the notice was served what the      correct or missing particulars should havebeen. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 20.7 | English      language.  Any notice under or in connection with a      Finance Document shall be inEnglish. |
|------|----------------------------------------------------------------------------------------------------------------------|

| 20.8 | Meaning of      “notice”.  In this Clause “notice” includes any demand,      consent, authorization, approval, instruction, waiver or other      communication. |
|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 21 | GUARANTY |
|----|----------|

| 21.1 | Guaranty.  In      order to induce the Lenders to make the Loan to the Borrowers, and to      induce the Swap Banks to enter into Designated Transactions with the      Borrowers, the Guarantor hereby guarantees (this “Guaranty”), as a      primary obligor and not merely as a surety, the performance and punctual      payment when due, whether at stated maturity, by acceleration or      otherwise, of all Secured Liabilities of the Borrowers now or hereafter      existing under this Agreement and any other Finance Document, whether for      principal, interest, fees, expenses or otherwise (collectively, the “Guaranteed      Obligations”) due or owing to any of the Lenders or the Swap Banks      (each, a “Guaranteed      Party”), and agrees to pay any and all expenses (including, without      limitation, counsel fees and expenses) incurred by a Guaranteed Party, the      Security Trustee, the Facility Agent or the Payment Agent in enforcing any      rights under this Guaranty.  The obligations of the Guarantor      under this Guaranty are in addition to and shall not in any way be      prejudiced by any other guaranty or security now or subsequently held by      the Guaranteed Parties.  The Guarantor hereby further agrees      that if the Borrowers shall fail to pay in full when due (whether at      stated maturity, by acceleration or otherwise) any of the Guaranteed      Obligations, the Guarantor will promptly pay the same, on first demand,      and that in the case of any extension of time of payment or renewal of any      of the Guaranteed Obligations, the same will be promptly paid in full when      due (whether at extended maturity, by acceleration or otherwise) in      accordance with the terms of such extension or  renewal. |
|------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 21.2 | Obligations      absolute.  The Guarantor guarantees that the Guaranteed      Obligations will be performed and paid to the Guaranteed Parties strictly      in accordance with the terms of any applicable agreement, express or      implied, of the Borrowers, regardless of any law, regulation or order of      any jurisdiction affecting any term of any Guaranteed Obligation or the      rights of the Guaranteed Parties with respect thereto, including, without      limitation, any law, rule or policy which is now or hereafter promulgated      by any governmental authority (including, without limitation, any central      bank) or regulatory body any of which may adversely affect the Borrowers’      ability or obligation to make, or right of the Guaranteed Parties to      receive, such payments, including, without limitation, any sovereign act      or circumstance which might otherwise constitute a defense to, or a legal      or equitable discharge of, theBorrowers. |
|------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 21.3 | Guaranty      Unconditional.  The liability of the Guarantor hereunder      shall be unconditional irrespective of, and the Guarantor hereby waives      any defenses it may assert with respectto: |
|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (a) | any      lack of validity or enforceability of any Guaranteed Obligation or      agreement or instrument relatingthereto; |
|-----|---------------------------------------------------------------------------------------------------------------------------|

| (b) | any      change in the time, manner or place of payment of, or in any other term      of, any Guaranteed Obligation; |
|-----|----------------------------------------------------------------------------------------------------------------------|

| (c) | any      exchange, release or non-perfection of any other Collateral securing      payment of any GuaranteedObligation; |
|-----|-------------------------------------------------------------------------------------------------------------------------|

| (d) | any      moratorium, bankruptcy, insolvency or other similar law or any other law,      regulation or order of any jurisdiction affecting any term of any      Guaranteed Obligation or a Guaranteed Party’s rights with respect thereto;      or |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (e) | any      other circumstance which might otherwise constitute a defense available      to, or the discharge of, any of the Borrowers, or the      Guarantor. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 21.4 | Waiver of subrogation;      Contribution.  Notwithstanding any other provision of      this Guaranty, until payment in full of the Guaranteed Obligations in cash      after termination of any of the Guaranteed Parties’ commitments with      respect thereto: |
|------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (a) | the      Guarantor hereby irrevocably waives any right to assert, enforce, or      otherwise exercise any right of subrogation to any of the rights, security      interests, claims, or liens which the Guaranteed Parties have against the      Borrowers in respect of the Guaranteed  Obligations; |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | the      Guarantor shall not have any right of recourse, reimbursements,      contribution, indemnification, or similar right (by contract or otherwise)      against the Borrowers in respect of the Guaranteed Obligations;      and |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (c) | the      Guarantor hereby irrevocably waives any and all of the foregoing rights      and also irrevocably waives the benefit of, and any right to participate      in, any Collateral or other security given to the Guaranteed Parties to      secure payment of the GuaranteedObligations. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 21.5 | Subordination.  The      Guarantor agrees that, so long as the Borrowers remain under any actual or      contingent liability under this Agreement or any other Finance Document,      any rights which the Guarantor may have at any time by reason of the      performance by the Guarantor of the Guaranteed Obligations to take the      benefit (in whole or in part) of any security taken pursuant to this      Agreement or any of the other Finance Documents shall be subject and      subordinate to the rights of the Guaranteed Parties hereunder and shall be      exercised by the Guarantor in such manner and upon such terms as the      Guaranteed Parties may require and further agree to hold any monies at any      time received by the Guarantor as a result of the exercise of any such      rights or otherwise for and on behalf of the Guaranteed Parties for      application in or towards payment of any sums at any time owed by the      Borrowers under the Agreement or the other Finance    Documents. |
|------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 21.6 | Reinstatement.  This      Guaranty shall continue to be effective or be reinstated, as the case may      be, if at any time any payment of any of the Guaranteed Obligations is      rescinded or must otherwise be returned by a Guaranteed    Party. |
|------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 21.7 | Waiver.  The      Guarantor waives promptness, diligence and notices with respect to any      Guaranteed Obligation and this Guaranty and any requirement that a      Guaranteed Party exhaust any right or take any action against the      Borrowers or any other entity or any or their  property. |
|------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (a) | All      payments under this Guaranty shall be made in accordance with Clauses 11,      15 and 16 of this Agreement. |
|-----|----------------------------------------------------------------------------------------------------------------------|

| (b) | The      Guarantor agrees to pay any taxes which arise from any payment made      hereunder or from the execution, delivery or registration by such      Guarantor of, or otherwise with respect to, this  Agreement. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (c) | The      Guarantor will indemnify a Guaranteed Party in accordance with Clause 15      upon demand. |
|-----|-----------------------------------------------------------------------------------------------------|

| (d) | Within      30 days after the date of any payment of taxes, the Guarantor will furnish      to each Guaranteed Party at its address for notices, the original or a      certified copy of a receipt evidencing payment thereof.  If no      taxes are payable in respect of any payment, the Guarantor will furnish to      each Guaranteed Party a certificate from each appropriate taxing      authority, or an opinion of counsel acceptable to each Guaranteed Party,      in either case stating that such payment is exempt from or not subject to      taxes. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 21.9 | Continuing      Guarantee.  This Guaranty is a continuing guaranty, is      joint and several with any other guarantee given in respect of the      Guaranteed Obligations, and shall remain in full force and effect until      the later of the termination of any Commitment of the Lenders under this      Agreement and the payment in full of the Guaranteed Obligations and all      other amounts payable hereunder and shall be binding upon the Guarantor,      its successors and permitted assigns.  The obligations of the      Guarantor under this Guaranty shall rank pari passu with all      other unsecured obligations of theGuarantor. |
|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 22.1 | General.  All      liabilities and obligations of the Borrowers under this Agreement shall be      joint and several, whether expressed to be so or  not. |
|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 22.2 | No impairment of Borrowers’      obligations.  The joint and several liabilities and      obligations of a Borrower shall not be impaired  by: |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (a) | this      Agreement or any other Finance Document being or later becoming void,      unenforceable or illegal as regards any other  Borrower; |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | any      Lender or the Security Trustee entering into any rescheduling, refinancing      or other arrangement of any kind with any other  Borrower; |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------|

| (c) | any      Lender or the Security Trustee releasing any other Borrower or any      Security Interest created by a Finance Document;  or |
|-----|---------------------------------------------------------------------------------------------------------------------------------------|

| (e) | any      combination of the foregoing. |
|-----|----------------------------------------|

| 22.3 | Principal      debtors.  Each Borrower declares that it is and will,      throughout the Security Period, remain a principal debtor for all amounts      owing under this Agreement and the other Finance Documents to which it is      a party and no Borrower shall in any circumstances be construed to be a      surety for the obligations of any other Borrower under this Agreement or      the other Finance Documents. |
|------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 22.4 | Subordination.  Subject      to Clause 22.5, during the Security Period, no Borrower    shall: |
|------|----------------------------------------------------------------------------------------------------------|

| (a) | claim      by way of any legal or administrative action any amount which may be due      to it from any other Borrower whether in respect of a payment made, or      matter arising out of, this Agreement or the other Finance Documents, or      any matter unconnected with this Agreement or the other Finance Documents;      or |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | take      or enforce any form of security from any other Borrower for such an      amount, or in any other way seek to have recourse in respect of such an      amount against any asset of any other Borrower;  or |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (c) | set      off such an amount against any sum due from it to any other Borrower;      or |
|-----|----------------------------------------------------------------------------------------|

| (d) | prove      or claim for such an amount in any liquidation, administration,      arrangement or similar procedure involving any other Borrower or any      Security Party; or |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (e) | exercise      or assert any combination of theforegoing. |
|-----|----------------------------------------------------------|

| 22.5 | Borrowers’ required      action.  If during the Security Period, the Security      Trustee, by notice to a Borrower, requires it to take any action referred      to in paragraphs (a) to (d) of Clause 22.4, in relation to any other      Borrower, that Borrower shall take that action as soon as practicable      after receiving the Agent’s notice. |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 23.1 | Rights cumulative,      non-exclusive.  The rights and remedies which the Finance      Documents give to the CreditParties: |
|------|---------------------------------------------------------------------------------------------------------------------------------------|

| (c) | shall      not, unless a Finance Document explicitly and specifically states so, be      taken to exclude or limit any right or remedy conferred by any      law. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 23.2 | Severability of      provisions.  If any provision of a Finance Document is or      subsequently becomes void, unenforceable or illegal, that shall not affect      the validity, enforceability or legality of the other provisions of that      Finance Document or of the provisions of any other Finance      Document. |
|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 24 | THE      FACILITY AGENT, THE PAYMENT AGENT AND THE SECURITY  TRUSTEE |
|----|----------------------------------------------------------------------|

| 24.1 | Appointment and      Granting. |
|------|--------------------------------|

| (a) | The Facility      Agent.  Each Lender and each Swap Bank irrevocably      appoints and authorizes the Facility Agent to act as its agent hereunder      and under any of the other Finance Documents with such powers as are      specifically delegated to the Facility Agent by the terms of this      Agreement and of any of the other Finance Documents, together with such      other powers as are reasonably incidental  thereto. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (d) | The Payment      Agent.  Each Lender and each Swap Bank irrevocably      appoints and authorizes the Payment Agent to act as its agent hereunder      and under any of the other Finance Documents with such powers as are      specifically delegated to the Payment Agent by the terms of this Agreement      and of any of the other Finance Documents, together with such other powers      as are reasonably incidentalthereto. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (i) | Authorization of Security      Trustee.  Each of the Lenders, the Facility Agent, the      Payment Agent and the Swap Banks irrevocably appoints and authorizes the      Security Trustee to act as security trustee hereunder and under the other      Finance Documents (other than the Notes) with such powers as are      specifically delegated to the Security Trustee by the terms of this      Agreement and such other Finance Documents, together with such other      powers as are reasonably incidentalthereto. |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (ii) | Granting      Clause.  To secure the payment of all sums of money from      time to time owing (i) to the Lenders under this Agreement, the Note, and      the other Finance Documents in the maximum principal amount of $75,000,000      plus accrued interest thereon and (ii) to the Swap Banks under this      Agreement, the Master Agreement and the other Finance Documents in the      maximum principal amount of $18,750,000 plus accrued interest thereon, and      all other amounts owing to the Lenders, the Facility Agent, the Payment      Agent, the Security Trustee or the Swap Banks pursuant to this Agreement,      the Notes, the Master Agreements and the other Finance Documents, and the      performance of the covenants of the Borrowers and any other obligor herein      and therein contained, and in consideration of the premises and of the      covenants herein contained and of the extensions of credit by the Lenders,      the Security Trustee does hereby declare that it will hold as such trustee      in trust for the benefit of the Lenders, the Facility Agent, the Payment      Agent and the Swap Banks, from and after the execution and delivery      thereof, all of its right, title and interest as mortgagee in, to and      under the Mortgages and its right, title and interest as assignee and      secured party under the other Finance Documents (the right, title and      interest of the Security Trustee in and to the property, rights and      privileges described above, from and after the execution and delivery      thereof, and all property hereafter specifically subjected to the lien of      the indenture created hereby and by the Finance Documents by any amendment      hereto or thereto are herein collectively called the “Estate”); TO HAVE AND TO      HOLD the Estate unto the Security Trustee and its successors and assigns      forever, BUT IN TRUST, NEVERTHELESS, for the equal and proportionate      benefit and security of the Lenders, the Facility Agent, the Payment      Agent, and the Swap Banks and their respective successors and assigns      without any priority of any one over any other, UPON THE CONDITION that,      unless and until an Event of Default under this Agreement shall have      occurred and be continuing, the Borrowers shall be permitted, to the      exclusion of the Security Trustee, to possess and use the      Ships.  IT IS HEREBY COVENANTED, DECLARED AND AGREED that all      property subject or to become subject hereto is to be held, subject to the      further covenants, conditions, uses and trusts hereinafter set forth, and      each Borrower, for itself and its respective successors and assigns,      hereby covenants and agrees to and with the Security Trustee and its      successors in said trust, for the equal and proportionate benefit and      security of the Lenders, the Facility Agent, the Payment Agent and the      Swap Banks as hereinafter setforth. |
|--------|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (iii) | Acceptance of      Trusts.  The Security Trustee hereby accepts the trusts      imposed upon it as Security Trustee by this Agreement, and the Security      Trustee covenants and agrees to perform the same as herein expressed and      agrees to receive and disburse all monies constituting part of the Estate      in accordance with the termshereof. |
|--------|-------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 24.2 | Scope of      Duties.  None of the Facility Agent, the Payment Agent,      or the Security Trustee (which terms as used in this sentence and in      Section 24.5 hereof shall include reference to their respective affiliates      and their own respective and their respective affiliates’ officers,      directors, employees, agents and attorneys-in-fact): (a) shall have any      duties or responsibilities except those expressly set forth in this      Agreement and in any of the Finance Documents, and shall not by reason of      this Agreement or any of the Finance Documents be (except, with respect to      the Security Trustee, as specifically stated to the contrary in this      Agreement) a trustee for a Lender or a Swap Bank; (b) shall be responsible      to the Lenders or the Swap Banks for any recitals, statements,      representations or warranties contained in this Agreement or in any of the      Finance Documents, or in any certificate or other document referred to or      provided for in, or received by any of them under, this Agreement or any      of the Finance Documents, or for the value, validity, effectiveness,      genuineness, enforceability or sufficiency of this Agreement or any of the      Finance Documents or any other document referred to or provided for herein      or therein or for any failure by the Borrowers or any other person to      perform any of its obligations hereunder or thereunder or for the      location, condition or value of any property covered by any lien under any      of the Finance Documents or for the creation, perfection or priority of      any such lien; (c) shall be required to initiate or conduct any litigation      or collection proceedings hereunder or under any of the Finance Documents      unless expressly instructed to do so in writing by the Majority Lenders;      or (d) shall be responsible for any action taken or omitted to be taken by      it hereunder or under any of the Finance Documents or under any other      document or instrument referred to or provided for herein or therein or in      connection herewith or therewith, except for its own gross negligence or      willful misconduct.  Each of the Security Trustee, the Facility      Agent and the Payment Agent may employ agents and attorneys-in-fact and      none of the Security Trustee, the Facility Agent or the Payment Agent      shall be responsible for the negligence or misconduct of any such agents      or attorneys-in-fact selected by it in good faith.  Each of the      Security Trustee, the Facility Agent and the Payment Agent may deem and      treat the payee of a Note as the holder thereof for all purposes hereof      unless and until a written notice of the assignment or transfer thereof      shall have been filed with the Facility Agent, together with the written      consent of the Borrowers to such assignment or  transfer. |
|------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 24.3 | Reliance.  Each      of the Security Trustee, the Facility Agent and the Payment Agent shall be      entitled to rely upon any certification, notice or other communication      (including any thereof by telephone, telex, telefacsimile, telegram or      cable) believed by it to be genuine and correct and to have been signed or      sent by or on behalf of the proper person or persons, and upon advice and      statements of legal counsel, independent accountants and other experts      selected by the Security Trustee, the Facility Agent or the Payment Agent,      as the case may be.  As to any matters not expressly provided      for by this Agreement or any of the Finance Documents, each of the      Security Trustee, the Facility Agent and the Payment Agent shall in all      cases be fully protected in acting, or in refraining from acting,      hereunder or thereunder in accordance with instructions signed by the      Majority Lenders, and such instructions and any action taken or failure to      act pursuant thereto shall be binding on all of the    Lenders. |
|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 24.4 | Knowledge.  None      of the Security Trustee, the Facility Agent or the Payment Agent shall be      deemed to have knowledge or notice of the occurrence of a Potential Event      of Default or Event of Default (other than, in the case of the Payment      Agent, the non-payment of principal of or interest on the Loan or any      Advance) unless each of the Security Trustee, the Facility Agent and the      Payment Agent has received notice from a Lender or a Borrower specifying      such Potential Event of Default or Event of Default and stating that such      notice is a “Notice of Default”.  If the Facility Agent receives      such a notice of the occurrence of such Potential Event of Default or      Event of Default, the Facility Agent shall give prompt notice thereof to      the Security Trustee, the Payment Agent, the Swap Banks and the Lenders      (and shall give each Lender prompt notice of each such      non-payment).  Subject to Section 24.8 hereof, the Security      Trustee, the Facility Agent and the Payment Agent shall take such action      with respect to such Potential Event of Default or Event of Default or      other event as shall be directed by the Majority Lenders, except that,      unless and until the Security Trustee, the Facility Agent and the Payment      Agent shall have received such directions, each of the Security Trustee,      the Facility Agent and the Payment Agent may (but shall not be obligated      to) take such action, or refrain from taking such action, with respect to      such Potential Event of Default or Event of Default or other event as it      shall deem advisable in the best interest of the Lenders and the Swap      Banks. |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 24.5 | Security Trustee, Facility      Agent and Payment Agentas      Lenders.  Each of the Security Trustee, the Facility      Agent and the Payment Agent (and any successor acting as Security Trustee,      Facility Agent or Payment Agent, as the case may be) in its individual      capacity as a Lender hereunder shall have the same rights and powers      hereunder as any other Lender and may exercise the same as though it were      not acting as the Security Trustee, Facility Agent or Payment Agent, as      the case may be, and the term “Lender” or “Lenders” shall, unless the      context otherwise indicates, include each of the Security Trustee, the      Facility Agent and the Payment Agent in their respective individual      capacities.  Each of the Security Trustee, the Facility Agent      and the Payment Agent (and any successor acting as Security Trustee,      Facility Agent and Payment Agent, as the case may be) and their respective      affiliates may (without having to account therefor to a Lender) accept      deposits from, lend money to and generally engage in any kind of banking,      trust or other business with a Borrower and any of its subsidiaries or      affiliates as if it were not acting as the Security Trustee, Facility      Agent or Payment Agent, as the case may be, and each of the Security      Trustee, the Facility Agent and the Payment Agent and their respective      affiliates may accept fees and other consideration from such Borrower for      services in connection with this Agreement or otherwise without having to      account for the same to theLenders. |
|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 24.6 | Indemnification of Security      Trustee, Facility Agent and Payment Agent.  The Lenders      agree to indemnify each of the Security Trustee, the Facility Agent and      the Payment Agent (to the extent not reimbursed under other provisions of      this Agreement, but without limiting the obligations of the Borrowers      under said other provisions, ratably in accordance with the aggregate      principal amount of each Lenders’ participation in the Loan), for any and      all liabilities, obligations, losses, damages, penalties, actions,      judgments, suits, costs, expenses or disbursements of any kind and nature      whatsoever which may be imposed on, incurred by or asserted against the      Security Trustee, the Facility Agent or the Payment Agent in any way      relating to or arising out of this Agreement or any of the Finance      Documents or any other documents contemplated by or referred to herein or      therein or the transactions contemplated hereby (including, without      limitation, the costs and expenses which the Borrowers are to pay      hereunder, but excluding, unless an Event of Default has occurred and is      continuing, normal administrative costs and expenses incident to the      performance of their respective agency duties hereunder) or the      enforcement of any of the terms hereof or thereof or of any such other      documents, except that no Lender shall be liable for any of the foregoing      to the extent they arise from the gross negligence or wilful misconduct of      the party to be indemnified. |
|------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 24.7 | Reliance on Security Trustee,      Facility Agent or Payment Agent.  Each Lender agrees that      it has, independently and without reliance on the Security Trustee, the      Facility Agent or the Payment Agent or any other Lender, and based on such      documents and information as it has deemed appropriate, made its own      credit analysis of the Obligors and decision to enter into this Agreement      and that it will, independently and without reliance upon the Security      Trustee, the Facility Agent or the Payment Agent or any other Lender, and      based on such documents and information as it shall deem appropriate at      the time, continue to make its own analysis and decisions in taking or not      taking action under this Agreement or any of the Finance      Documents.  None of the Security Trustee, the Facility Agent or      the Payment Agent shall be required to keep itself informed as to the      performance or observance by the Borrowers of this Agreement or any of the      Finance Documents or any other document referred to or provided for herein      or therein or to inspect the properties or books of the      Borrowers.  Except for notices, reports and other documents and      information expressly required to be furnished to the Lenders by the      Security Trustee, the Facility Agent or the Payment Agent hereunder, none      of the Security Trustee, the Facility Agent or the Payment Agent shall      have any duty or responsibility to provide a Lender with any credit or      other information concerning the affairs, financial condition or business      of the Obligors or any of their respective parents, subsidiaries or      affiliates which may come into the possession of the Security Trustee, the      Facility Agent or the Payment Agent or any of their respective      affiliates. |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 24.8 | Actions by Security Trustee,      Facility Agent and Payment Agent.  Except for action      expressly required of the Security Trustee, the Facility Agent or the      Payment Agent hereunder and under the other Finance Documents, each of the      Security Trustee, the Facility Agent and the Payment Agent shall in all      cases be fully justified in failing or refusing to act hereunder and      thereunder unless it shall receive further assurances to its satisfaction      from the Lenders of their indemnification obligations under Section 24.5      hereof against any and all liability and expense which may be incurred by      it by reason of taking or continuing to take any such    action. |
|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 24.9 | Resignation and      Removal.  Subject to the appointment and acceptance of a      successor Security Trustee, Facility Agent or Payment Agent (as the case      may be) as provided below, each of the Security Trustee, the Facility      Agent and the Payment Agent may resign at any time by giving notice      thereof to the Lenders and the Borrowers, and the Security Trustee, the      Facility Agent or the Payment Agent may be removed at any time with or      without cause by the Majority Lenders.  Upon any such      resignation or removal, the Majority Lenders shall have the right to      appoint a successor Security Trustee, Facility Agent or Payment Agent, as      the case may be, which shall be a Lender, or a Lender with an Affiliate,      which has an office in New York, New York.  If no successor      Security Trustee, Facility Agent or Payment Agent, as the case may be,      shall have been so appointed by the Lenders or, if appointed, shall not      have accepted such appointment within 30 days after the retiring Security      Trustee’s, Facility Agent’s, or Payment Agent’s, as the case may be,      giving of notice of resignation or the Majority Lenders’ removal of the      retiring Security Trustee, Facility Agent or Payment Agent, as the case      may be, then the retiring Security Trustee, Facility Agent or Payment      Agent, as the case may be, may, on behalf of the Lenders, appoint a      successor Security Trustee, Facility Agent or Payment Agent, as the case      may be, which shall be a Lender, or a Lender with an Affiliate, which has      an office in New York, New York.  Upon the acceptance of any      appointment as Security Trustee, Facility Agent or Payment Agent hereunder      by a successor Security Trustee, Facility Agent or Payment Agent, such      successor Security Trustee, Facility Agent or Payment Agent, as the case      may be, shall thereupon succeed to and become vested with all the rights,      powers, privileges and duties of the retiring Security Trustee, Facility      Agent or Payment Agent, as the case may be, and the retiring Security      Trustee, Facility Agent or Payment Agent shall be discharged from its      duties and obligations hereunder.  After any retiring Security      Trustee’s, Facility Agent’s or Payment Agent’s resignation or removal      hereunder as Security Trustee, Facility Agent or Payment Agent, as the      case may be, the provisions of this Clause 24 shall continue in effect for      its benefit in respect of any actions taken or omitted to be taken by it      while it was acting as Security Trustee, Facility Agent or Payment Agent,      as the case may be. |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 24.10 | Release of      Collateral.  Without the prior written consent of the      Lenders and the Swap Banks, none of the Security Trustee, the Facility      Agent or the Payment Agent will consent to any modification, supplement or      waiver under any of the Finance Documents nor without the prior written      consent of all of the Lenders and the Swap Banks release any Collateral or      otherwise terminate any lien under the Finance Documents, except that no      such consent is required, and each of the Security Trustee, the Facility      Agent and the Payment Agent is authorized, to release any lien covering      property if the obligations have been paid and performed in full or which      is the subject of a disposition of property permitted hereunder or to      which the Lenders and the Swap Banks have  consented. |
|-------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 25.1 | Governing      law.  THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED      IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW  YORK. |
|------|------------------------------------------------------------------------------------------------------------------------------------------------|

| (a) | Each      Obligor hereby irrevocably submits to the jurisdiction of any New York      State or Federal court sitting in New York County and any appellate court      from any thereof in any action or proceeding arising out of or relating to      this Agreement or any other Finance Document, and each Obligor hereby      irrevocably agrees that all claims in respect of any such action or      proceeding may be heard and determined in such New York State or in such      Federal court.  Each Obligor hereby irrevocably waives, to the      fullest extent that it may effectively do so, any objection it may now or      hereafter have to the laying of the venue of any action or proceeding      arising out of or relating to this Agreement or any other Finance Document      and the defense of an inconvenient forum to the maintenance of any such      action or proceeding.  Each Obligor also irrevocably consents to      the service of any and all process in any such action or proceeding by the      mailing of copies of such process to its address specified in Clause      20.2.  Each Obligor hereby agrees to appoint Cardillo &      Corbett, with offices currently located at 29 Broadway, New York, New York      10006, Attention: Tulio R. Prieto, as its designated agent for service of      process for any action or proceeding arising out of or relating to this      Agreement or any other Finance Document.  Each Obligor agrees      that a final judgment in any such action or proceeding shall be conclusive      and may be enforced in other jurisdictions by suit on the judgment or in      any other manner provided by law. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | Nothing      in this Clause 25.2 shall affect the right of a Credit Party to serve      legal process in any other manner permitted by law or affect the right of      such person to bring any action or proceeding against an Obligor or its      property in the courts of any other jurisdictions where such action or      proceeding may be heard. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 25.3 | Rights      unaffected.  Nothing in this Clause 25 shall exclude or      limit any right a Credit Party may have (whether under the law of any      country, an international convention or otherwise) with regard to the      bringing of proceedings, the service of process, the recognition or      enforcement of a judgment or any similar or related matter in any      jurisdiction. |
|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 25.4 | Meaning of      “proceedings”.  In this Clause 25, “proceedings” means      proceedings of any kind, including an application for a provisional or      protective measure. |
|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 26.1 | WAIVER.  THE      OBLIGORS AND THE CREDIT PARTIES MUTUALLY AND IRREVOCABLY WAIVE ANY AND ALL      RIGHT TO TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING ARISING OUT OF OR      RELATING TO THIS AGREEMENT, THE OTHER FINANCE DOCUMENTS OR THE      TRANSACTIONS CONTEMPLATED HEREBY ORTHEREBY. |
|------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 27.1 | PATRIOT Act      Notice.  The Facility Agent hereby notifies the Obligors      that pursuant to the requirements of the PATRIOT Act and the Credit      Parties’ policies and practices, each of the Credit Parties is required to      obtain, verify and record certain information and documentation that      identifies the Obligors, which information includes the name and address      of the Obligors and such other information that will allow the Credit      Parties to identify the Obligors in accordance with the PATRIOT      ACT. |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 27.2 | OFAC and Bank Secrecy      Act. |
|------|---------------------------------|

| (a) | Each      Obligor shall ensure that no person who owns a controlling interest in or      otherwise controls such Obligor or any subsidiary thereof is or shall be      listed on the Specially Designated Nationals and Blocked Person List or      other similar lists maintained by the Office of Foreign Assets Control      (“OFAC”), the U.S.      Department of the Treasury or included in any Executive      Orders. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | The      Obligors shall not use or permit the use of the proceeds of the Loan to      violate any of the foreign asset control regulations of OFAC or any      enabling statute or Executive Order relating  thereto. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (c) | The      Obligors shall comply, and shall cause each of its subsidiaries to comply,      with all applicable Bank Secrecy Act laws and regulations, as      amended. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 28 | POSITION      OF THE LENDERS AND THE SWAP BANKS |
|----|-------------------------------------------------|

| 28.1 | Interests of Credit Parties      several.  The rights of the Credit Parties under this      Agreement are several. |
|------|------------------------------------------------------------------------------------------------------------------------------|

| 28.2 | Individual Credit Parties’      right of action.  Each Lender and each of the Swap Banks      shall be entitled to sue for any amount which has become due and payable      by the Borrowers to it under this Agreement, any Master Agreement or any      other Finance Document without joining the Facility Agent, the Security      Trustee or any other Credit Party as additional parties in the      proceedings, provided      that neither any of the Swap Banks nor any Lender may commence      proceedings against the Borrowers or any other Obligor in connection with      a Finance Document without the prior consent of the Majority      Lenders. |
|------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 28.3 | Obligations of Credit Parties      several.  The obligations of the Lenders and the Swap      Banks under this Agreement are several, and a failure of a Lender or the      Swap Banks to perform its obligations under this Agreement shall not      result in: |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (a) | the      obligations of the other Lenders or the Swap Banks being increased;      or |
|-----|--------------------------------------------------------------------------------------|

| (b) | the      Borrowers, any other Obligor, any other Lender or the Swap Banks being      discharged (in whole or in part) from its obligations under any Finance      Document; |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 22.4 | Swap Pari      Passu.  At all times during the Security Period, each of      the Swap Banks and the Lender agree that the rights of the Swap Banks      under the Master Agreements (including, without limitation, any right of      repayment) shall be pari      passu with the rights of the Lenders under this Agreement and the      other Finance Documents. |
|------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|   | [SIGNATURE      PAGE FOLLOWS ON NEXT PAGE] |
|--------|--------------------------------------------|

| BEDFORD      MARITIME CORP., as Borrower  By:  /s/ Tara DeMakes    Tara      DeMakes    Attorney-in-Fact              | DVB      GROUP MERCHANT BANK (ASIA) LTD., as Lender By:      /s/ Evan Cohen      Evan CohenManaging Director                                                                                                                                             |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| BRIGHTON      MARITIME CORP., as Borrower   By:        /s/ Tara      DeMakes    Tara      DeMakes    Attorney-in-Fact | DVB      GROUP MERCHANT BANK (ASIA) LTD., as Facility Agent and Security      Trustee By:      /s/ Evan Cohen      Evan CohenManaging Director                                                                                                           |
| HARI      MARITIME CORP., as Borrower    By: /s/ Tara DeMakes     Tara      DeMakes    Attorney-in-Fact               | THE      GOVERNOR AND COMPANY OF THE BANK OF IRELAND, as Payment Agent  By:      /s/ Paul      PackardPaul PackardHead of Maritime      Industries By:      /s/ JohnO'DeaJohn O’DeaSenior Manager                                        |
| PROSPECT      NAVIGATION CORP., as Borrower  By:  /s/ Tara DeMakes     Tara      DeMakes     Attorney-in-Fact              | DVB      BANK AG, as Swap Bank  By:      /s/ Daniel C.      Rodgers    Daniel      C. Rodgers    Attorney-in-Fact                                                                                           |
| HANCOCK      NAVIGATION CORP., as Borrower   By:  /s/ Tara DeMakes     Tara      DeMakes    Attorney-in-Fact          | THE      GOVERNOR AND COMPANY OF THE BANK OF IRELAND, as Swap Bank  By:      /s/ Paul      PackardPaul PackardHead of Maritime      Industries By:      /s/ JohnO'DeaJohn O’DeaSenior Manager                                            |
| COLUMBUS      MARITIME CORP., as Borrower  By: /s/ Tara DeMakes     Tara      DeMakes    Attorney-in-Fact                  | NATIXIS,      as Swap Bank  By:      /s/ Guillaume de      Beaucorps    Guillaume de      Beaucorps    Authorized      Signatory By:      /s/ Franck      ChambrasFranck ChambrasAuthorized Signatory  |
| WHITEHALL      MARINE TRANSPORT CORP.,as      Borrower  By: /s/ Tara DeMakes     Tara      DeMakes    Attorney-in-Fact     | MOUNT      WASHINGTON LLCas      Arranger  By:      /s/ Carol Ann Malinowski          Carol      Ann Malinowski    Attorney-in-Fact                                                                              |
| TBS      INTERNATIONAL LIMITED, as Guarantor  By:  /s/ Tara DeMakes     Tara      DeMakes    Attorney-in-Fact:             |                                                                                                                                                                                                                                                               |

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|   | 77      Robinson Road 30-02 |
|--------|-----------------------------|

|   | Singapore |
|--------|-----------|

| 1 | We      refer to the loan agreement (the “Loan Agreement”) dated      as of January 16, 2008 and made between ourselves, as Borrowers, and the      other parties named therein in connection with a loan facility of up to      the lesser of $75,000,000 and 59% of the aggregate Fair Market Value of      the Ships.  Terms defined in the Loan Agreement have their      defined meanings when used in this Drawdown  Notice. |
|---|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (a) | the      representations and warranties in Clause 9 of the Loan Agreement would      remain true and not misleading if repeated on the date of this Drawdown      Notice with reference to the circumstances now existing;    and |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | no      Event of Default or Potential Event of Default has occurred or will result      from the borrowing of the Loan. |
|-----|-------------------------------------------------------------------------------------------------------------------------|

| 5 | We      authorize you to deduct any balance of the upfront fee referred to in      Clause 14 outstanding on the Expected Drawdown Date from the amount of the      Advance. |
|---|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| BEDFORD      MARITIME CORP., BRIGHTON MARITIME CORP., HARI MARITIME CORP., PROSPECT      NAVIGATION CORP., HANCOCK NAVIGATION CORP., COLUMBUS MARITIME CORP. and      WHITEHALL MARINE TRANSPORT CORP. as Borrowers  By:      Name:      Title:        |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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| 1. | An      original of: |
|----|----------------------|

|   | (a) | each      Finance Document and each document required to be delivered by each      Finance Document, each duly executed by each party thereto, and      documentary evidence that the Security Interests created by such Finance      Documents have been duly perfected; |
|--------|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (b) | each      Manager’s Undertaking and each document required to be delivered by each      Manager’s Undertaking, each duly executed by each party      thereto; |
|--------|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (d) | each      Deletion Power of Attorney, duly executed in counterparts by each party      thereto (and, if executed by any party thereto outside of the Republic of      the Philippines, duly consularized before a consulate of the Republic of      the Philippines in the jurisdiction of  execution). |
|--------|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 2. | Copies      of the constitutional documents, and each amendment thereto, of each      Obligor, certified as of a date reasonably near the date of the relevant      Drawdown Notice by the president or the secretary (or equivalent officer)      of such party as being a true and correct copy  thereof. |
|----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3. | Copies      of certificates dated as of a date reasonably near the date of the      Drawdown Notice, certifying that each Obligor is duly incorporated (or      formed) and in goodstanding under the laws of such party’s jurisdiction of      incorporation (or formation) and, in respect of each Borrower, that such      Borrower is duly qualified and in goodstanding as a foreign maritime      entity under the law of the Republic ofLiberia. |
|----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 4. | Copies      of resolutions of the directors (or equivalent governing body) (and where      required, the shareholders or equivalent equity holders)    of: |
|----|------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (a) | each      Obligor authorizing the execution of each of the Finance Documents to      which such Obligor is or is to be a party (and additionally, in the case      of each Borrower, the Bareboat Charter and Memorandum of Three Party      Agreement to which such Borrower is or is to be a party) and authorizing      named officers or attorneys-in-fact to execute such documents and, in the      case of the Borrowers, to give the Drawdown Notice and other notices      required by the Finance Documents;and |
|--------|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (b) | the      relevant Bareboat Charterer and Pacific Rim authorizing the execution of      the relevant Bareboat Charter(s) and Memorandum of Three Party Agreement      to which it is a party and authorizing named officers or attorneys-in-fact      to execute such documents and to give any notices required      thereunder, |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 5. | The      original of any power of attorney under which a Bareboat Charter,      Memorandum of Three Party Agreement or any Finance Document is to be      executed on behalf of an Obligor. |
|----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 6. | Copies      of all consents which any of the Obligors requires to enter into, or make      any payment or perform any of its obligations under or in connection with      the transactions contemplated by this Agreement, each certified as of a      date reasonably near the date of the relevant Drawdown Notice by the      president or the secretary (or equivalent officer) of such party as being      a true and correct copy thereof, or certification by such president or      secretary (or equivalent officer) that no such consents are      required. |
|----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 7. | Copies      of each Bareboat Charter and Memorandum of Three Party Agreement,      certified as of a date reasonably near the date of the relevant Drawdown      Notice by the president or the secretary (or equivalent officer) of the      respective Borrower thereto as being a true and correct copy thereof, each      Bareboat Charter and Memorandum of Three Party Agreement to be in form and      substance acceptable to the FacilityAgent. |
|----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 8. | Documentary      evidence that the agent for service of process named in Clause 25.2 has      accepted its appointment in respect of the  Obligors. |
|----|-----------------------------------------------------------------------------------------------------------------------------------------------------|

| 9. | A      certificate of each Obligor, signed on behalf of each such party by the      president or the secretary (or equivalent officer) of the Guarantor, dated      as of the Expected Drawdown Date (the statements made in such certificate      shall be true on and as of the Expected Drawdown Date), certifying as      to: |
|----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (a) | the      absence of any proceeding for the dissolution or liquidation of such      party; |
|--------|-----|-------------------------------------------------------------------------------------------|

|   | (b) | the      veracity in all material respects of the representations and warranties      contained in this Agreement as though made on and as of the Expected      Drawdown Date; |
|--------|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (c) | the      absence of any material misstatement of fact in any information provided      by the Borrowers to the Facility Agent or any Lender and that such      information did not omit to state any material fact necessary to make the      statements therein, in the light of the circumstances under which they      were made, not misleading; and |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (d) | the      absence of any event occurring and continuing, or resulting from the      making of the Advance, that constitutes a Potential Event of Default or an      Event of Default. |
|--------|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (a) | [intentionally      omitted] |
|--------|-----|------------------------------|

|   | (b) | each      Ship has been delivered by the relevant Borrower to the relevant Bareboat      Charterer in accordance with all of the terms and conditions of the      relevant Bareboat Charter, free and clear of all liens and encumbrances      other than the relevant Mortgage, together with a copy of the Protocol of      Delivery and Acceptance for such Ship, duly executed by the relevant      Borrower and the relevant Bareboat Charterer, certified as of the Expected      Drawdown Date by the president or the secretary (or equivalent officer) of      the relevant Borrower as being a true and correct copy of the      original; |
|--------|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (c) | there      is/are no pending dispute(s) or arbitration proceedings arising out of or      in connection with a Bareboat Charter or Memorandum of Three Party      Agreement (which may be established by a certificate dated as of the      Expected Drawdown Date by the president or the secretary (or equivalent      officer) of the relevant Borrower); |
|--------|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (d) | each      Ship is registered in the name of the relevant Borrower under Liberian      registry, free of all recorded liens and encumbrances, save as      contemplated by the Finance Documents (which shall be established by a      Certificate of Ownership and Encumbrance issued by the appropriate      Liberian authorities stating that such Ship is owned by the relevant      Borrower and that there are on record no other mortgages, liens or other      encumbrances on such Ship except the relevant  Mortgage); |
|--------|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (e) | each      Mortgage has been preliminarily registered against the relevant Ship as a      valid first priority ship mortgage in accordance with the laws of the      Republic of Liberia and the Security Interests created by the Finance      Documents shall have been dulyperfected; |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (f) | the      Government of the Republic of Liberia has authorized each Ship to be      temporarily registered under Philippine flag without loss of Liberian      registry; |
|--------|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (g) | each      Ship is bareboat registered in the name of the relevant Bareboat Charterer      under Philippine bareboat registry, free of all recorded liens and      encumbrances, save as contemplated by the Finance Documents (which shall      be established by a Certificate of Ownership and Encumbrance (or similar      instrument) issued by the Philippine Maritime Industry Authority stating      that such Ship is bareboat registered in the name of the relevant Bareboat      Charterer and that there are on record no other mortgages, liens or other      encumbrances on such Ship except the relevant Mortgage), provided that, with      respect to the Mortgage, it shall be acceptable for the relevant Borrower      to deliver to the Facility Agent as soon as possible, but in no event      later than 60 days, following the Actual Drawdown Date, evidence      acceptable to the Facility Agent that the Philippine Maritime Industry      Authority has recognized that the existence of the Mortgage with respect      such Ship and that such Mortgage is governed by the law of the Republic of      Liberia, and has duly noted the same in the Bareboat    Registry; |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (h) | a      cautionary notice of the Mortgage with respect to each Ship has been filed      in the Bareboat Registry, such notice to be in form and substance      acceptable to the Facility Agent, provided that such      notice may be filed as soon as is feasible after the Actual Drawdown Date      if such notice cannot be filed on or before the Actual Drawdown      Date; |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (i) | each      Ship is classed with the Classification Society in the highest      classification and rating for vessels of the same age and type without any      outstanding conditions or recommendations affecting class (other than      those for which the time prescribed for curing the condition or      recommendation has not passed), which shall be established by a      Confirmation of Class Certificate issued by the Classification Society and      dated a date reasonably near the Expected Drawdown Date; a “Class      Statement” or similar instrument shall not be acceptable for purposes of      this clause; and |
|--------|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (i) | is      insured in compliance with the terms of the relevant Mortgage, including      mortgagee’s interest insurance; |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------------|

|   | (ii) | is      or will be managed by the Approved Manager in accordance with management      agreements acceptable to the Majority Lenders;  and |
|--------|------|-------------------------------------------------------------------------------------------------------------------------------------------|

|   | (iii) | has      been inspected and found to be in a satisfactory condition by an inspector      appointed by the Facility Agent at the cost of the    Borrowers. |
|--------|-------|-----------------------------------------------------------------------------------------------------------------------------------------------------------|

| 11. | A      certificate by the president or the secretary (or equivalent officer) of      each Borrower, or a certificate of the Approved Manager (technical),      identifying and giving the address and other communication details of the      ISM Responsible Person(s). |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 12. | Copies      of the Document of Compliance and Safety Management Certificate for each      Ship referred to in paragraph (a) of the definition of the ISM Code      Documentation, certified as true and in effect by the relevant Borrower or      the Approved Manager (technical). |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 13. | Copies      of such other ISM Code Documentation as the Facility Agent may have      requested by written notice to the Borrowers not later than 2 days before      the Expected Drawdown Date, certified as true and complete in all material      respects by the Borrowers or the Approved Manager    (technical). |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 14. | Certification      by each Borrower or the Approved Manager (technical)  that: |
|-----|--------------------------------------------------------------------------------|

|   | (i) | the      Ship owned by will maintain for the duration of the Security Period a      valid International Ship SecurityCertificate; |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------------------|

|   | (ii) | the      security system of the Ship owned by it and associated security equipment      complies with the applicable requirements of Chapter XI-2 of SOLAS and      Part A of the ISPS Code; and |
|--------|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (iii) | an      approved ship security plan is inplace. |
|--------|-------|-------------------------------------------------|

| 16. | A      favorable report from an insurance consultant nominated by the Facility      Agent confirming that the insurance placed on the Ships is in compliance      with the Mortgage thereon (and all costs associated with such report shall      be payable by the Borrowers). |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 17. | A      favorable opinion of Watson, Farley & Williams (New York) LLP, New      York counsel for the Credit Parties, in form, scope and substance      satisfactory to the Credit Parties. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 18. | A      favorable opinion of Cardillo & Corbett, New York, Liberian and      Marshall Islands counsel to the Obligors, in form, scope and substance      satisfactory to the Credit Parties. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 19. | A      favorable opinion of Conyers Dill & Pearman, Bermuda counsel to the      Guarantor, in form, scope and substance satisfactory to the Credit      Parties. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 20. | A      favorable opinion of Sycip, Salazar, Hernandez & Gatmaitman,      Philippine counsel to the Credit Parties, in form, scope and substance      satisfactory to the Credit Parties. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|   | To: | Maritime      Industry Authority |
|--------|-----|----------------------------------|

|   | Date: |
|--------|-------|

| Re: | m.v.      “__________________” (the “Ship”) |
|-----|---------------------------------------------------------------------|

|   | Dear      Sirs: |
|--------|-----------------|

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|   | IRREVOCABLE      POWER OF ATTORNEY |
|--------|------------------------------------|

|   | IN      FAVOR OF |
|--------|------------------|

----

| [1. | Attached      hereto are: |
|-----|---------------------------|

|   | (a) | true,      correct and complete copies of the annual financial statements of the      Company, and the audit thereof prepared by [●];  and |
|--------|-----|--------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (b) | a      written appraisal report setting forth the Fair Market Value of the      Ship.] |
|--------|-----|----------------------------------------------------------------------------------------|

| [1. | Attached      hereto are true, correct and complete copies of the quarterly unaudited      financial results of the Company for the quarter ended [date], including the      balance sheet, profit and loss account and quarterly management      accounts.] |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 2. | I      have reviewed such financial statements and they fairly present the      financial condition and the results of operations of the Company for the      period indicated. |
|----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3. | As      per the calculation stated in Annex A attached hereto, as at the date      hereof the Collateral Maintenance Ratio is not less than 135% and at all      times during the accounting period covered by the financial statements      referred to above the Collateral Maintenance Ratio was not less than      135%. |
|----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 4. | I      have reviewed the Loan Agreement and each of the other Finance Documents      and have made, or caused to be made under my supervision, a review in      reasonable detail of the transactions contemplated by the Loan Agreement      and each of the other Finance Documents for the accounting period covered      by the financial statements referred to above, and such review has not      disclosed the existence during or at the end of such accounting period of      an Event of Default or of any Potential Event of Default or any other      event which might adversely affect any Obligor’s ability to perform its      obligations under the Loan Agreement or any of the other Finance Documents      to which it is a party, and I do not have knowledge of the existence of      any such event or condition as at the date of this Certificate [except [●]      - describe the event or      condition, the period of its existence and what action is being taken to      remedy the same]. |
|----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 5. | The      Company maintains in full force and effect, and complies with the      conditions and restrictions (if any) imposed in connection with, every      consent, authorization, license or approval which may from time to time be      necessary or required for the continued due performance of all its      obligations under the Loan Agreement and the other Finance Documents to      which it is a party. |
|----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 6. | The      Company is in compliance with all of the covenants set forth in the Loan      Agreement and the other Finance Documents to which it is a      party. |
|----|---------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 7. | The      representations and warranties stated in Clause 9 of the Loan Agreement      (updated mutatis      mutandis) are true and correct as of the date    hereof. |
|----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

| 1. | Attached      hereto is a true, correct and complete copy of [insert text below as      appropriate] |
|----|------------------------------------------------------------------------------------------------------|

| 2. | Each      of the Obligors is in compliance with all of the covenants set forth in      the Loan Agreement and the other Finance Documents to which it is a party      and the Guarantor is in compliance with all of the TBS Credit Facility      Financial Covenants regardless of whether the TBS Credit Facility is in      effect or not. |
|----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3. | As      per the calculation stated in Annex A attached hereto, as at the date      hereof the Collateral Maintenance Ratio is not less than 135% and at all      times during the accounting period covered by the financial statements      referred to above the Collateral Maintenance Ratio was not less than      135%. |
|----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 4. | I      have reviewed the Loan Agreement and each of the other Finance Documents      and have made, or caused to be made under my supervision, a review in      reasonable detail of the transactions contemplated by the Loan Agreement      and each of the other Finance Documents for the accounting period covered      by the financial statements referred to above, and such review has not      disclosed the existence during or at the end of such accounting period of      an Event of Default or of any Potential Event of Default or any other      event which might adversely affect any Obligor’s ability to perform its      obligations under the Loan Agreement or any of the other Finance Documents      to which it is a party, and I do not have knowledge of the existence of      any such event or condition as at the date of this Certificate [except [●]      - describe the event or      condition, the period of its existence and what action is being taken to      remedy the same]. |
|----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 5. | Each      of the Obligors maintains in full force and effect, and complies with the      conditions and restrictions (if any) imposed in connection with, every      consent, authorization, license or approval which may from time to time be      necessary or required for the continued due performance of all its      obligations under the Loan Agreement and the other Finance Documents to      which it is a party. |
|----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 6. | The      representations and warranties stated in Clause 9 of the Loan Agreement      (updated mutatis      mutandis) are true and correct as of the date    hereof. |
|----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

----

|   | (a) | all      freight, hire and passage moneys, compensation payable to the Assignor in      the event of requisition of the Ship for hire, remuneration for salvage      and 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 theShip; |
|--------|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (b) | all      moneys which are at any time payable under insurances in respect of loss      of earnings; and |
|--------|-----|---------------------------------------------------------------------------------------------------------|

|   | (c) | if      and whenever the Ship is employed on terms whereby any moneys falling      within paragraphs (a) or (b) above are pooled or shared with any other      person, that proportion of the net receipts of the relevant pooling or      sharing arrangement which is attributable to the  Ship. |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

----

----

----

----

| From: | TBS      SHIPPING SERVICES, INC. |
|-------|----------------------------------|

| To: | DVB      GROUP MERCHANT BANK (ASIA) LTD., as Facility  Agent |
|-----|--------------------------------------------------------------|

| Date: | [●] |
|-------|-----------|

| 1. | Loan      Agreement |
|----|---------------------|

| 2. | Confirmation      of Appointment |
|----|----------------------------------|

| 3. | Representation      and Warranty |
|----|----------------------------------|

| 4. | Undertaking |
|----|-------------|

| (a) | all      claims of whatsoever nature which we have or may at any time hereafter      have against or in connection with the Ship, its earnings, insurances or      requisition compensation, or against the Shipowner, as the case may be,      shall rank after and be in all respects subordinate to all of the rights      and claims of the Credit Parties against such property or      persons; |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | we      shall not institute any legal or quasi-legal proceedings under any      jurisdiction at any time hereafter against the Ship, its earnings,      insurances or requisition compensation, or against the Shipowner, as the      case may be, in any capacity without your express, prior written      consent; |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (c) | we      shall not compete with the Credit Parties in a liquidation or other      winding-up or bankruptcy of the Shipowner, or in any proceedings in      connection with the Ship or its earnings, insurances or requisition      compensation; |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (d) | we      will not agree or purport to agree to any amendment or variation of the      Management Agreement without your prior written consent, which consent      shall not be unreasonably withheld, save where the amendment or variation      is required to comply with applicable laws or  regulations; |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (e) | we      will procure that any sub-manager appointed by us will, on or before the      date of such appointment, enter into an undertaking in your favor in      substantially the same form as thisundertaking; |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (f) | we      will immediately advise you in writing if the Ship’s Safety Management      Certificate is withdrawn; |
|-----|---------------------------------------------------------------------------------------------------------------------|

| (g) | we      shall use best efforts not do, or omit to do, or cause anything to be done      or omitted, which might be contrary to or incompatible with the      obligations undertaken by the Shipowner under the Loan Agreement and the      other Finance Documents; |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (h) | we      shall upon your first written request deliver to you all documents of      whatever nature held by us or any sub-manager appointed by us in      connection with the Shipowner, the Ship, its earnings, insurances or      requisition compensation; |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (i) | we      will advise you in writing prior to our ceasing to be the commercial      manager of the Ship; and |
|-----|------------------------------------------------------------------------------------------------------------|

| (j) | if      we are named as a co-assured on any insurances respecting the Ship, we      will seek to enforce such co assured status only in respect of our      provable, casualty related, out of pocket expenses that are collected from      underwriters. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 5. | Law      and Jurisdiction |
|----|---------------------------|

----

| From: | ROYMAR      SHIP MANAGEMENT, INC. |
|-------|-----------------------------------|

| To: | DVB      GROUP MERCHANT BANK (ASIA) LTD., as Facility  Agent |
|-----|--------------------------------------------------------------|

| Date: | [●] |
|-------|-----------|

| 1. | Loan      Agreement |
|----|---------------------|

| 2. | Confirmation      of Appointment |
|----|----------------------------------|

| 3. | Representation      and Warranty |
|----|----------------------------------|

| 4. | Undertaking |
|----|-------------|

| (a) | all      claims of whatsoever nature which we have or may at any time hereafter      have against or in connection with the Ship, its earnings, insurances or      requisition compensation, or against the Shipowner, as the case may be,      shall rank after and be in all respects subordinate to all of the rights      and claims of the Credit Parties against such property or      persons; |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | we      shall not institute any legal or quasi-legal proceedings under any      jurisdiction at any time hereafter against the Ship, its earnings,      insurances or requisition compensation, or against the Shipowner, as the      case may be, in any capacity without your express, prior written      consent; |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (c) | we      shall not compete with the Credit Parties in a liquidation or other      winding-up or bankruptcy of the Shipowner, or in any proceedings in      connection with the Ship or its earnings, insurances or requisition      compensation; |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (d) | we      will not agree or purport to agree to any amendment or variation of the      Management Agreement without your prior written consent, which consent      shall not be unreasonably withheld, save where the amendment or variation      is required to comply with applicable laws or  regulations; |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (e) | we      will procure that any sub-manager appointed by us will, on or before the      date of such appointment, enter into an undertaking in your favor in      substantially the same form as thisundertaking; |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (f) | we      will immediately advise you in writing if the Ship’s Safety Management      Certificate is withdrawn; |
|-----|---------------------------------------------------------------------------------------------------------------------|

| (g) | we      shall use best efforts not do, or omit to do, or cause anything to be done      or omitted, which might be contrary to or incompatible with the      obligations undertaken by the Shipowner under the Loan Agreement and the      other Finance Documents; |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (h) | we      shall upon your first written request deliver to you all documents of      whatever nature held by us or any sub-manager appointed by us in      connection with the Shipowner, the Ship, its earnings, insurances or      requisition compensation; |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (i) | we      will advise you in writing prior to our ceasing to be the technical      manager of the Ship; and |
|-----|-----------------------------------------------------------------------------------------------------------|

| (j) | if      we are named as a co-assured on any insurances respecting the Ship, we      will seek to enforce such co assured status only in respect of our      provable, casualty related, out of pocket expenses that are collected from      underwriters. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 5. | Law      and Jurisdiction |
|----|---------------------------|

----

----

| Clause |                                                    | Page |
|--------|---------------------------------------------------------|------|
| 1      | DEFINITIONS      AND INTERPRETATION                     | 2    |
| 2      | MORTGAGE                                                | 4    |
| 3      | PAYMENT      COVENANTS                                  | 6    |
| 4      | REPRESENTATIONS      AND WARRANTIES                     | 7    |
| 5      | INSURANCE      COVENANTS                                | 7    |
| 6      | SHIP      COVENANTS                                     | 12   |
| 7      | PROTECTION      OF SECURITY                             | 17   |
| 8      | ENFORCEABILITY      AND SECURITY TRUSTEE’S POWERS | 18   |
| 9      | APPLICATION      OF MONEYS                              | 19   |
| 10     | FURTHER      ASSURANCES                                 | 19   |
| 11     | POWER      OF ATTORNEY                                  | 20   |
| 12     | INCORPORATION      OF LOAN AGREEMENT PROVISIONS         | 21   |
| 13     | TOTAL      AMOUNT, ETC.                                 | 21   |
| 14     | SUPPLEMENTAL                                            | 22   |
| 15     | LAW      AND JURISDICTION                               | 22   |

----

| (1) | [●], a corporation      organized and existing under the law of the Republic of The Marshall      Islands and duly registered as a Foreign Maritime Entity under the law of      the Republic of Liberia, whose registered office is at The Trust Company      Complex, Ajeltake Island, PO Box 1405, Majuro, Marshall Islands MH96960      (the “Owner”) |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | IN      FAVOR OF |
|--------|------------------|

| (2) | DVB GROUP MERCHANT BANK (ASIA)      LTD., with offices at 77 Robinson Road 30-02 Singapore (the “Security Trustee”, which      expression includes its successors andassigns). |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | BACKGROUND |
|--------|------------|

| (A) | The      Owner is the sole owner of the whole of the m.v. “[●]” documented under      the laws and flag of the Republic of Liberia with Official Number [●] of      [●] gross registered tons and [●] net registered  tons. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (B) | Pursuant      to and subject to the conditions contained in a loan agreement dated as of      January 16, 2008 (the “Loan Agreement”) among      (i) the Owner and the other borrowers named therein, as joint and several      borrowers (collectively, the “Borrowers”), (ii) TBS      International Limited as Guarantor, (iii) the banks and financial      institutions named therein as lenders (collectively, the “Lenders”), (iv) DVB      Group Merchant Bank (Asia) Ltd. as Facility Agent, (v) The Governor and      Company of the Bank of Ireland (“BOI”), as Payment Agent,      (vi) DVB Bank AG, BOI and Natixis as Swap Banks, (vii) Mount      Washington LLC as Arranger and (viii) the Security Trustee, the Lenders      agreed to make available to the Borrowers a loan facility in an aggregate      principal amount of up to SEVENTY-FIVE MILLION UNITED STATES DOLLARS      (US$75,000,000) (the “Loan”).  The      Loan, interest thereon, fees and all expenses, costs and charges otherwise      from time to time payable by the Borrowers under the Loan Agreement are to      be repaid and paid, as the case may be, as provided in the Loan Agreement      and such provisions in the Loan Agreement are incorporated herein by      reference and made a part of this Mortgage.  A copy of the form      of Loan Agreement, without attachments, is annexed to this Mortgage as an      integral part hereof and marked as ExhibitA. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (C) | The      obligation of the Borrowers to repay the Loan is evidenced by a secured      promissory note (the “Note”) of the Borrowers,      a copy of the form of which is annexed to this Mortgage as an integral      part hereof and marked as ExhibitB. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (D) | Pursuant      to Master Agreements on the 2002 ISDA Master Agreement      (Multicurrency-Crossborder) form dated January [●], 2008 made between the      Borrowers and the Swap Banks, the Swap Banks agreed to enter into certain      Transactions pursuant to separate Confirmations from time to time to hedge      the exposure of the Borrower to interest rate fluctuations under the Loan      Agreement.  A copy of the form of the Master Agreements and the      Schedules thereto (collectively, with any amending, supplemental or      replacement agreements, and the Confirmations exchanged thereunder, the      “Master      Agreements”) is annexed to this Mortgage as an integral part hereof      and marked as Exhibit C.  The Borrowers and the Swap Banks      estimate that the aggregate maximum amount payable by the Borrowers under      the Master Agreements in event all Transactions entered into thereunder      are terminated will not exceed EIGHTEEN MILLION SEVEN HUNDRED FIFTY      THOUSAND UNITED STATES DOLLARS(US$18,750,000). |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (E) | Pursuant      to Clause 24.1(c) of the Loan Agreement, it was agreed that the Security      Trustee would hold the Estate in trust for the Lenders and the Swap      Banks. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (F) | It      is one of the conditions precedent to the availability of the facility      under the Loan Agreement that the Owner executes and delivers this      Mortgage in favor of the Security Trustee as security for the Secured      Liabilities and the performance and observance of and compliance with the      covenants, terms and conditions contained in the Finance      Documents. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (G) | The      Owner has authorized the execution and delivery of this Mortgage under and      pursuant to Chapter 3 of Title 21 of the Liberian Code of Laws of 1956 as      amended. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | IT IS AGREED as      follows: |
|--------|-------------------------------|

| 1 | DEFINITIONS      AND INTERPRETATION |
|---|-------------------------------------|

| 1.1 | Defined      expressions.  Words and expressions defined in the Loan      Agreement shall have the same meanings when used in this Mortgage unless      the context otherwise requires. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 1.2 | Definitions.  In      this Mortgage, unless the contrary intention  appears: |
|-----|----------------------------------------------------------------------------------------|

|   | (a) | any      claim by any governmental, judicial or regulatory authority which arises      out of an Environmental Incident or an alleged Environmental Incident or      which relates to any Environmental Law;or |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (b) | any      claim by any other person which relates to an Environmental Incident or to      an alleged Environmental Incident, |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------------|

|   | (a) | any      release of Environmentally Sensitive Material from the Ship;      or |
|--------|-----|-------------------------------------------------------------------------------|

|   | (b) | any      incident in which Environmentally Sensitive Material is released from a      vessel other than the Ship and which involves a collision between the Ship      and such other vessel or some other incident of navigation or operation,      in either case, in connection with which the Ship is actually or      potentially liable to be arrested, attached, detained or enjoined and/or      the Ship or the Owner and/or any operator or manager of the Ship is at      fault or allegedly at fault or otherwise liable to any legal or      administrative action; or |
|--------|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (c) | any      other incident in which Environmentally Sensitive Material is released      otherwise than from the Ship and in connection with which the Ship is      actually or potentially liable to be arrested and/or where the Owner      and/or any operator or manager of the Ship is at fault or allegedly at      fault or otherwise liable to any legal or administrative      action; |
|--------|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 1.3 | References to Majority      Lenders.  References in this Mortgage to an approval,      consent, or requirement of the Majority Lenders include references to an      approval, consent or requirementof: |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (a) | the      Facility Agent or the Security Trustee acting with the authority of the      Majority Lenders; or |
|-----|------------------------------------------------------------------------------------------------------------|

| (b) | the      Security Trustee acting with the authority of the Facility Agent acting,      in turn, with the authority of the Majority  Lenders. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------|

| 1.4 | Application of construction and      interpretation provisions of Loan Agreement.  Clauses 1.2      and 1.5 of the Loan Agreement apply, with any necessary modifications, to      this Mortgage. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 1.5 | Inconsistency between Loan      Agreement provisions and this Mortgage.  This Mortgage      shall be read together with the Loan Agreement, but in case of any      conflict between the Loan Agreement and this Mortgage, the provisions of      the Loan Agreement shall prevail, providedthat this Mortgage shall      always be governed by Liberian law. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 2 | MORTGAGE |
|---|----------|

| 2.1 | Mortgage.  In      consideration of the premises and other good and valuable consideration,      the Owner grants, conveys, mortgages, pledges, confirms, assigns,      transfers and sets over the whole of the Ship to the Security Trustee as      security for: |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (a) | the      due and punctual payment of the Secured Liabilities;  and |
|-----|--------------------------------------------------------------------|

| (b) | the      performance and observance of and compliance with the covenants, terms and      conditions contained in the Finance Documents to which the Owner is or is      to be a party. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 2.2 | Extent of property      mortgaged.  This Mortgage shall not cover property other      than the Ship as the term “Vessel” is used in Subdivision 1 of Section 106      of Chapter 3 of the Liberian Code of Laws of 1956 as    amended. |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 2.3 | Void      provisions.  Any provision of this Mortgage construed as      waiving the preferred status of this Mortgage shall, to such extent, be      void and of no effect. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 2.4 | Continuing      security.  This Mortgage shall remain in force until the      end of the Security Period as a continuing security and, in      particular: |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (a) | the      Security Interests created by Clause 2.1 shall not be satisfied by any      intermediate payment or satisfaction of the Secured      Liabilities; |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | the      Security Interests created by Clause 2.1, and the rights of the Security      Trustee under this Mortgage, are only capable of being extinguished,      limited or otherwise adversely affected by an express and specific term in      a document signed by or on behalf of the Security  Trustee; |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (c) | no      failure or delay by or on behalf of the Security Trustee to enforce or      exercise a Security Interest created by Clause 2.1 or a right of the      Security Trustee under this Mortgage, and no act, course of conduct,      acquiescence or failure to act (or to prevent the Owner from taking      certain action) which is inconsistent with such a Security Interest or      such a right shall preclude or estop the Security Trustee (either      permanently or temporarily) from enforcing or exercising it;      and |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (d) | this      Mortgage shall be additional to, and shall not in any way impair or be      impaired by: |
|-----|----------------------------------------------------------------------------------------------------|

|   | (i) | any      other Security Interest whether in relation to property of the Owner or      that of a third party; or |
|--------|-----|-----------------------------------------------------------------------------------------------------------------|

|   | (ii) | any      other right of recourse as against the Owner or any third      party, |
|--------|------|--------------------------------------------------------------------------------|

| 2.5 | No obligations imposed on      Security Trustee.  The Owner shall remain liable to      perform all obligations connected with the Ship and the Security Trustee      shall not, in any circumstances, have or incur any obligation of any kind      in connection with the Ship. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 2.6 | Waiver of rights and      defenses.  The Owner shall neither be discharged by, nor      have any claim against, any Credit Party in respect  of: |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (a) | any      amendment or supplement being made to the Finance    Documents; |
|-----|--------------------------------------------------------------------------|

| (b) | any      arrangement or concession (including a rescheduling or acceptance of      partial payments) relating to, or affecting, the Finance      Documents; |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (c) | any      release or loss of any right or Security Interest created by the Finance      Documents; |
|-----|---------------------------------------------------------------------------------------------------|

| (d) | any      failure promptly or properly to exercise or enforce any such right or      Security Interest, including a failure to realize for its full market      value an asset covered by such a Security Interest;  or |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (e) | any      other Finance Document or any Security Interest now being or later      becoming void, unenforceable, illegal or invalid or otherwise defective      for any reason, including a neglect to register  it. |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 2.7 | Subordination of rights of      Owner.  All rights which the Owner at any time has with      respect to this Mortgage against any other Obligor or their respective      assets shall be fully subordinated to the rights of the Credit Parties      under the Finance Documents, and in particular the Owner shall      not: |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (a) | claim,      or in a bankruptcy of another Obligor prove for, any amount payable to the      Owner by such Obligor, in respect of this  Mortgage; |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | take      or enforce any Security Interest for any such  amount; |
|-----|------------------------------------------------------------------|

| (c) | claim      to set-off any such amount against any amount payable by the Owner to      another; or |
|-----|---------------------------------------------------------------------------------------------------|

| (d) | claim      any subrogation or other right in respect of any Finance Document or any      sum received or recovered by any Credit Party under a Finance      Document. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 2.8 | Negative pledge; disposal of      assets.  The Owner shall not sell, create any Security      Interest not exclusively securing the Secured Liabilities over, or      otherwise dispose of, the Ship or any right relating to the      Ship. |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 2.9 | Release of      security.  At the end of the Security Period, the      Security Trustee shall, at the request and cost of the Owner, discharge      this Mortgage. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3 | PAYMENT      COVENANTS |
|---|------------------------|

| 3.1 | General.  The      Owner shall comply with the following provisions of this Clause 3 at all      times during the Security Period provided that every      payment which the Owner makes in accordance with the Loan Agreement shall      pro tanto satisfy the Owner’s liability under this Clause    3. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3.2 | Covenant to repay      Loan.  The Owner shall repay the Loan in accordance with      the terms of the Loan Agreement. |
|-----|---------------------------------------------------------------------------------------------------------------------------------|

| 3.3 | Covenant to pay interest on      Loan.  The Owner shall pay to the Security Trustee      interest on the whole or any part of the Loan in accordance with the terms      of the Loan Agreement. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3.4 | Covenant to pay expenses      etc.  The Owner shall pay to the Security Trustee all      such expenses, claims, liabilities, losses, costs, duties, fees, charges      or other moneys as are stated in this Mortgage to be payable by the Owner      to or recoverable from the Owner by the Security Trustee (or in respect of      which the Owner agrees in this Mortgage to indemnify the Security Trustee)      at the times and in the manner specified in this  Mortgage. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3.5 | Covenant to pay default      interest.  The Owner shall pay to the Security Trustee      interest on any expenses, claims, liabilities, losses, costs, duties,      fees, charges or other moneys referred to in Clause 3.4 from the date on      which the relevant expense, claim, liability, loss, cost, duty, fee,      charge or other money is paid or incurred by the Security Trustee (as well      after as before judgment): |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (a) | at      the rate described in clause 6.2 of the Loan  Agreement; |
|-----|------------------------------------------------------------------|

| (b) | compounded      in accordance with clause 6.5 of the Loan Agreement;  and |
|-----|---------------------------------------------------------------------------|

| (c) | on      demand. |
|-----|-----------------|

| 3.6 | Covenant to pay other      sums.  The Owner shall pay to the Security Trustee each      and every other sum of money which may be or become owing to the Security      Trustee under the Loan Agreement, this Mortgage and the other Finance      Documents to which the Owner is or is to be a party at the times and in      the manner specified in this Mortgage or in the other Finance      Documents. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 4 | REPRESENTATIONS      AND WARRANTIES |
|---|-------------------------------------|

| 4.1 | General.  The      Owner represents and warrants to the Security Trustee as      follows. |
|-----|-----------------------------------------------------------------------------------------------------|

| 4.2 | Repetition of Loan Agreement      representations and warranties.  The representations and      warranties in Clause 9 of the Loan Agreement remain true and not      misleading as if repeated on the date of this Mortgage with reference to      the circumstances now existing. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 5 | INSURANCE      COVENANTS |
|---|--------------------------|

| 5.1 | General.  The      Owner undertakes with the Security Trustee to comply with the following      provisions of this Clause 5 at all times during the Security Period except      as the Security Trustee may otherwisepermit. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 5.2 | Maintenance of obligatory      insurances.  The Owner shall keep the Ship insured at its      own expense against: |
|-----|------------------------------------------------------------------------------------------------------------------------------|

| (a) | fire      and usual marine risks (including hull and machinery and excess      risks); |
|-----|----------------------------------------------------------------------------------------|

| (b) | war      risks; |
|-----|-----------------|

| (c) | protection      and indemnity risks (including pollution risks and freight, demurrage and      defense cover); and |
|-----|--------------------------------------------------------------------------------------------------------------------|

| (d) | any      other risks against which the Security Trustee may advise or, on      instruction of the Majority Lenders shall advise, having regard to      practices and other circumstances prevailing at the relevant time and with      the Charterer’s consent, such consent not to be unreasonably withheld,      that it would be reasonable for the Owner to insure, as specified by the      Security Trustee by notice to theOwner. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 5.3 | Terms of obligatory      insurances.  The Owner shall effect such      insurances: |
|-----|----------------------------------------------------------------------------------------------|

| (a) | in      Dollars; |
|-----|------------------|

| (b) | in      the case of fire and usual marine risks, war risks and port risks, in an      amount on an agreed value basis equal at all times to the greater of (i)      the Fair Market Value of the Ship and (ii) an amount which, when added to      the amounts of such insurance on the other vessels identified in the Loan      Agreement and mortgaged to the Mortgagee as security for the Secured      Liabilities, is 120% of the aggregate outstanding principal amount of the      Secured Liabilities; |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (c) | in      the case of oil pollution liability risks, for an aggregate amount equal      to the highest level of cover from time to time available under basic      protection and indemnity club entry and the international marine insurance      market; |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (d) | in      relation to protection and indemnity risks in respect of the full tonnage      of the Ship; |
|-----|-----------------------------------------------------------------------------------------------------|

| (e) | on      approved terms; and |
|-----|-----------------------------|

| (f) | through      well known marine insurance brokers and with insurance companies and/or      underwriters with a Standard & Poor’s Rating of not less than A- or,      in the case of war risks and protection and indemnity risks, in approved      war risks and protection and indemnity risks associations, and without      prejudice to the Owner’s obligation to obtain the prior approval of the      Security Trustee, at all times with reputable international brokers,      companies, underwriters and mutual insurance  associations. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 5.4 | Further protections for the      Credit Parties.  In addition to the terms set out in      Clause 5.3, the Owner shall procure that the obligatory insurances      shall: |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (a) | if      so required by the Security Trustee (i) except in relation to risks      referred to in Clause 5.2(c), name (or be amended to name) the Security      Trustee and/or any other Credit Party as an additional named assured for      its rights and interests, warranted no operational interest and with full      waiver of rights of subrogation against the Security Trustee (and/or such      other Credit Party), and (ii) in relation to risks referred to in Clause      5.2(c), name (or be amended to name) the Security Trustee and/or any other      Credit Party as a co-assured or a co-assured under a misdirected arrows      clause, but in all cases without the Security Trustee (and/or such other      Credit Party) thereby being liable to pay (but having the right to pay)      premiums, calls or other assessments in respect of such      insurance; |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | name      the Security Trustee as loss payee in accordance with the loss payable      clause referred to in Clause 5.6(b) below and with such directions for      payment as the Security Trustee mayspecify; |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (c) | provide      that all payments by or on behalf of the insurers under the obligatory      insurances to the Security Trustee shall be made without set-off,      counterclaim or deductions or condition  whatsoever; |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (d) | provide      (on a reasonable efforts basis) that the insurers shall waive, to the      fullest extent permitted by applicable law, their entitlement (if any)      (whether by statute, common law, equity, or otherwise) to be subrogated to      the rights and remedies of the Security Trustee in respect of any rights      or interests (secured or not) held by or available to the Security Trustee      under the Finance Documents, until the Secured Liabilities shall have been      fully repaid and discharged, except that the insurers shall not be      restricted by the terms of this paragraph (d) from making personal claims      against persons (other than the Owner or any Credit Party) in      circumstances where the insurers have fully discharged their liabilities      and obligations under the relevant obligatory  insurances; |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (e) | provide      that such obligatory insurances shall be primary without right of      contribution from other insurances which may be carried by the Security      Trustee; |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (f) | provide      that the Security Trustee may make proof of loss if the Owner fails to do      so; |
|-----|-------------------------------------------------------------------------------------------------|

| (g) | provide      that if any obligatory insurance is cancelled, or if any substantial      change is made in the coverage which adversely affects the interest of the      Security Trustee, or if any obligatory insurance is allowed to lapse for      non-payment of premium, such cancellation, charge or lapse shall not be      effective with respect to the Security Trustee for 14 days (or 7 days in      the case of war risks) after receipt by the Security Trustee of prior      written notice from the insurers of such cancellation, change or lapse;      and |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (h) | apply      all sums receivable under the Insurances (other than in respect of a Total      Loss and any Major Casualty, which shall be payable to the Security      Trustee in accordance with the provisions of the Insurance Assignment) as      are paid to the Owner for the purpose of making good the loss and fully      repairing all damage in respect of which such sums shall have been      received. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 5.5 | Renewal of obligatory      insurances.  The Ownershall: |
|-----|-------------------------------------------------------------------|

| (a) | at      least 14 days before the expiry of any obligatory insurance effected by      it: |
|-----|------------------------------------------------------------------------------------------|

|   | (i) | notify      the Security Trustee of (1) the brokers (or insurers) and any protection      and indemnity or war risks association through or with whom the Owner      proposes to renew that insurance and (2) the proposed terms of renewal;      and |
|--------|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (ii) | obtain      the approval of the Security Trustee such consent not to be unreasonably      withheld, to the matters referred to in paragraph (i)    above; |
|--------|------|-----------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | at      least 7 days before the expiry of any obligatory insurance effected by it,      renew the insurance in accordance with the Security Trustee’s approval      pursuant to paragraph (a)(ii) above;and |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (c) | procure      that the approved brokers and/or the war risks and protection and      indemnity associations with which such a renewal is effected shall notify      the Security Trustee in writing of the terms and conditions of the renewal      promptly after the renewal. |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 5.6 | Copies of policies; letters of      undertaking.  The Owner shall ensure that all approved      brokers provide the Security Trustee with pro forma copies of all policies      relating to the obligatory insurances which they are to effect or renew      and of a letter or letters of undertaking in a form required by the      Security Trustee including undertakings by the approved brokers      that: |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (a) | they      will have endorsed on each policy, immediately upon issue, a loss payable      clause and a notice of assignment in such form as the Security Trustee may      require and complying with the provisions of Clause  5.4; |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | they      will hold such policies, and the benefit of such insurances, to the order      of the Security Trustee in accordance with the said loss payable      clause; |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (c) | they      will advise the Security Trustee immediately of any material change to the      terms of the obligatory insurances; |
|-----|-------------------------------------------------------------------------------------------------------------------------------|

| (d) | they      will notify the Security Trustee, not less than 7 days before the expiry      of the obligatory insurances, in the event of their not having received      notice of renewal instructions from the Owner or its agents and, in the      event of their receiving instructions to renew, they will promptly notify      the Security Trustee of the terms of the instructions;  and |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (e) | they      will not set off against any sum recoverable in respect of a claim      relating to the Ship under such obligatory insurances any premiums or      other amounts due to them or any other person whether in respect of the      Ship or otherwise, they waive any lien on the policies or, any sums      received under them, which they might have in respect of such premiums or      other amounts, and they will not cancel such obligatory insurances by      reason of non-payment of such premiums or other amounts, and will arrange      for a separate policy to be issued in respect of the Ship forthwith upon      being so requested by the SecurityTrustee. |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 5.7 | Copies of certificates of      entry.  The Owner shall ensure that any protection and      indemnity and/or war risks associations in which the Ship is entered      provides the Security Trustee with: |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (a) | a      certified copy of the certificate of entry for the  Ship; |
|-----|------------------------------------------------------------------|

| (b) | a      letter or letters of undertaking in such form as may be required by the      Security Trustee; and |
|-----|-----------------------------------------------------------------------------------------------------------|

| (c) | where      required to be issued under the terms of insurance/indemnity provided by      the Owner’s protection and indemnity association, but only if and when so      requested by the Security Trustee, a certified copy of each United States      of America voyage quarterly declaration (or other similar document or      documents) made by the Owner in relation to the Ship in accordance with      the requirements of such protection and indemnity association;      and |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (d) | a      certified copy of each certificate of financial responsibility for      pollution by oil or other Environmentally Sensitive Material issued by the      relevant certifying authority in relation to such Ship, but only if and      when so requested by the SecurityTrustee. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 5.8 | Deposit of original      policies.  The Owner shall ensure that all policies      relating to obligatory insurances effected by it are deposited with the      approved brokers through which the insurances are effected or      renewed. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 5.9 | Payment of      premiums.  The Owner shall punctually pay all premiums or      other sums payable in respect of the obligatory insurances effected for      the Ship and produce all relevant receipts when so required by the      Security Trustee. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 5.10 | Guarantees.  The      Owner shall ensure that any guarantees required by a protection and      indemnity or war risks association are promptly issued and remain in full      force and effect. |
|------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 5.11 | Restrictions on      employment.  The Owner shall not employ the Ship, nor      permit her to be employed, outside the cover provided by any obligatory      insurances. |
|------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 5.12 | Compliance with terms of      insurances.  The Owner shall not do nor omit to do (nor      permit to be done or not to be done) any act or thing which would or might      render any obligatory insurance invalid, void, voidable or unenforceable      or render any sum payable thereunder repayable in whole or in part; and,      in particular: |
|------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (a) | the      Owner shall take all necessary action and comply with all requirements      which may from time to time be applicable to the obligatory insurances,      and (without limiting the obligation contained in Clause 5.7(c)) ensure      that the obligatory insurances are not made subject to any exclusions or      qualifications to which the Security Trustee has not given its prior      approval; |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | the      Owner shall not make any changes relating to the classification or      classification society or manager or operator of the Ship unless approved      by the underwriters of the obligatory  insurances; |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (c) | the      Owner shall make all quarterly or other voyage declarations which may be      required by the protection and indemnity risks association to maintain      cover for trading to the United States of America and Exclusive Economic      Zone (as defined in the United States Oil Pollution Act 1990 or any other      applicable legislation); and |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (d) | the      Owner shall not employ the Ship, nor allow it to be employed, otherwise      than in conformity with the terms and conditions of the obligatory      insurances, without first obtaining the consent of the insurers and      complying with any requirements (as to extra premium or otherwise) which      the insurers specify. |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 5.13 | Alteration to terms of      insurances.  The Owner shall not make nor agree to any      alteration to the terms of any obligatory insurance nor waive any right      relating to any obligatoryinsurance. |
|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 5.14 | Settlement of      claims.  The Owner shall not settle, compromise or      abandon any claim under any obligatory insurance for Total Loss or for a      Major Casualty, and shall do all things necessary and provide all      documents, evidence and information to enable the Security Trustee to      collect or recover any moneys which at any time become payable in respect      of the obligatory insurances. |
|------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 5.15 | Provision of copies of      communications.  The Owner shall provide the Security      Trustee at the time of each such communication, with copies of all written      communications between the Ownerand: |
|------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (a) | the      brokers; and |
|-----|-----------------------|

| (b) | the      protection and indemnity and/or war risks associations;  and |
|-----|-----------------------------------------------------------------------|

| (c) | the      insurance companies and/orunderwriters, |
|-----|--------------------------------------------------|

| 5.16 | Provision of      information.  In addition, the Owner shall promptly      provide the Security Trustee (or any persons which it may designate) with      any information which the Security Trustee (or any such designated person)      requests from time to time for the purposeof: |
|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (a) | obtaining      or preparing any report from an independent marine insurance broker or the      Security Trustee’s in-house insurance consultant as to the adequacy of the      obligatory insurances effected or proposed to be effected;      and/or |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | effecting,      maintaining or renewing any such insurances as are referred to in Clause      5.17 below or dealing with or considering any matters relating to any such      insurances, |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 5.17 | Mortgagee’s interest and      additional perils insurance.  The Security Trustee shall      (unless required otherwise by the Majority Lenders) from time to time to      subscribe and thereafter maintain and renew all of the following      insurances in such amounts (but, in the case of the insurances referred to      in both Clause 5.17(a) and (b), an amount equal to 120 percent of the      principal amount of the Secured Liabilities), on such terms, through such      insurers and generally in such manner as the Security Trustee may from      time to time consider appropriate: |
|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (a) | a      mortgagee’s interest marine insurance covering the Ship and providing for      the indemnification of the Credit Parties for any losses under or in      connection with any Finance Document which directly or indirectly result      from loss of or damage to the Ship covered by such insurance or a      liability of such Ship or of the Owner, being a loss or damage which is      prima facie covered by an obligatory insurance but in respect of which      there is a non-payment (or reduced payment) by the underwriters by reason      of, or on the basis of an allegation concerning, among other      things: |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (i) | any      act or omission on the part of the Owner, of any operator, charterer,      manager or sub-manager of such Ship or of any officer, employee or agent      of the Owner or of any such person, including any breach of warranty or      condition or any non-disclosure relating to such obligatory      insurance; |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (ii) | any      act or omission, whether deliberate, negligent or accidental, or any      knowledge or privity of the Owner, any other person referred to in      paragraph (i) above, or of any officer, employee or agent of the Owner or      of such a person, including the casting away or damaging of such Ship      and/or such Ship being unseaworthy;and/or |
|--------|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (iii) | any      other matter capable of being insured against under a mortgagee’s interest      marine insurance policy whether or not similar to the foregoing;      and |
|--------|-------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | a      mortgagee’s interest additional perils policy providing for the      indemnification of the Credit Parties against, among other things, any      possible losses or other consequences of any Environmental Claim,      including the risk of expropriation, arrest or any form of detention of      the Ship and/or of any insurance recoveries which are or may be paid or      payable under the obligatory insurances relative to the Ship covered by      such insurance, or the imposition of any Security Interest over such Ship      and/or any such insurances and/or any other matter capable of being      insured against under a mortgagee’s interest additional perils      policy, |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 6 | SHIP      COVENANTS |
|---|---------------------|

| 6.1 | General.  The      Owner undertakes with the Security Trustee to comply with the following      provisions of this Clause 6 at all times during the Security Period except      as the Security Trustee may otherwisepermit. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 6.2 | Ship’s name and      registration.  The Ownershall: |
|-----|---------------------------------------------------------------------|

| (a) | keep      the Ship registered in its ownership under the Liberian    flag; |
|-----|----------------------------------------------------------------------------|

| (b) | not      change the name or port of registry of the Ship;  and |
|-----|----------------------------------------------------------------|

| (c) | not      do or allow to be done anything as a result of which such registration      might be cancelled or imperiled. |
|-----|-----------------------------------------------------------------------------------------------------------------------|

| 6.3 | Repair.  The      Owner shall keep the Ship in a good and efficient state of repair and      procure that all repairs to or replacement of any damaged, worn or lost      parts or equipment are effected in such manner (both as regards      workmanship and quality of materials) as not to materially reduce the      value of the Ship. |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 6.4 | Modification or replacement of      parts; equipment owned by third parties.  The Owner shall      not: |
|-----|-------------------------------------------------------------------------------------------------------------------|

| (a) | Except      for the conversion of the Ship to a multipurpose carrier, make any      modification to the Ship in consequence of which her structure, type or      performance characteristics could or might be materially altered and/or      her value materially reduced; or |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | remove      or replace any material part of, or any item of equipment installed on,      the Ship unless the part or item so removed is forthwith replaced by a      suitable part or item which is in the same condition as or better      condition than the part or item removed, is free from any Security      Interest or any right in favor of any person other than the Security      Trustee and becomes on installation on the Ship, the property of the Owner      and subject to the security constituted by this Mortgage; provided that the Owner      may install equipment owned by a third party if the equipment can be      removed without any risk of damage to theShip. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 6.5 | Maintenance of class;      compliance with regulations.  The Owner shall maintain      the present class of the Ship with the Classification Society, free from      overdue recommendations and so as to comply with the provisions of all      regulations and requirements (statutory or otherwise) from time to time      applicable to vessels registered under Liberian flag or otherwise      applicable to the Ship. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 6.6 | Surveys.  The      Owner shall submit the Ship to continuous surveys and such periodical or      other surveys as may be required for classification purposes and shall      supply to the Security Trustee, as it may reasonably request, copies of      all survey and class reports issued in respect  thereof. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 6.7 | Inspection.  Upon      reasonable notice, the Owner shall permit the Security Trustee, by      surveyors or other persons appointed by it for such purpose, to board the      Ship at all reasonable times for the purpose of inspecting her condition      and to afford all proper facilities for such inspections, provided that the person      designated by the Security Trustee to visit and inspect the Ship shall      execute a release and waiver satisfactory in form and substance to the      Owner and the Security Trustee; |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 6.8 | Prevention of and release from      arrest.  The Owner shall pay and discharge all debts,      damages, liabilities and outgoings whatsoever which have given or may give      rise to maritime, statutory or possessory liens on, or claims enforceable      against, the Ship and, in the event of a writ or libel being filed against      the Ship or the Ship being arrested pursuant to legal process or purported      legal process or in the event of detention of the Ship in exercise or      purported exercise of any such lien or claim as aforesaid, the Owner shall      procure the discharge of such writ or libel or the release of the Ship      from such arrest or detention within 30 days of receiving notice thereof      by providing bail or procuring the provision of security or otherwise as      the circumstances may require. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 6.9 | Employment.  The      Owner shall not employ the Ship or permit her employment in any manner,      trade or business which is forbidden by international law, or which is      unlawful or illicit under the law of any relevant jurisdiction, or in      carrying illicit or prohibited goods, or in any manner whatsoever which      may render her liable to condemnation in a Prize Court, or to destruction,      seizure, confiscation, penalty or sanctions and, in the event of      hostilities in any part of the world (whether war be declared or not),      shall not employ the Ship or permit her employment in carrying any      contraband goods or entry into or trade in any zone which is declared a      war zone by any government or by the Ship’s war risks insurers unless the      Security Trustee shall have first given its consent thereto in writing and      there shall have been effected by the Owner and at its expense such      special insurance cover as the Security Trustee may    require. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 6.10 | Information.  The      Owner shall furnish the Security Trustee promptly with all such      information as it may front time to time reasonably require regarding the      Ship, her employment, position and engagements, particulars of all towages      and salvages, and copies of charters and other contracts for her      employment, or otherwise whatsoever concerning  her. |
|------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 6.11 | Notification of certain      events.  The Owner shall notify the Security Trustee      forthwith by fax of: |
|------|-----------------------------------------------------------------------------------------------------------------------|

| (a) | any      damage to the Ship requiring repairs the cost of which will or might      exceed five hundred thousand Dollars ($500,000) (or the equivalent in any      other currency); |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | any      occurrence in consequence of which the Ship has or may become a Total      Loss; |
|-----|-------------------------------------------------------------------------------------------|

| (c) | any      requisition of the Ship for hire; |
|-----|--------------------------------------------|

| (d) | any      requirement or recommendation made by any insurer or classification      society or by any competent authority which is not complied or otherwise      dealt with in accordance with itsterms; |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (e) | any      arrest or detention of the Ship or any exercise or purported exercise of a      lien or other claim on the Ship or the Earnings, within 3 Business Days      thereof; |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (f) | any      petition or notice of meeting to consider any resolution to wind up the      Owner (or any event analogous thereto under the laws of the Republic of      The Marshall Islands); |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (g) | the      occurrence of an Event of Default; |
|-----|---------------------------------------------|

| (h) | any      claim for breach of the ISM Code or the ISPS Code in connection with the      Ship being made against the Owner, an ISM Responsible Person, the Approved      Manager or otherwise; and |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (i) | any      other material matter, event or incident, actual or threatened, the effect      of which will or could lead to the ISM Code or the ISPS Code not being      complied with as regards the Ship. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 6.12 | Payment of outgoings and      evidence of payments.  The Owner shall promptly pay all      rolls, dues and other outgoings whatsoever in respect of the Ship and      shall keep or procure there be kept proper books of account in respect of      the Ship and the Earnings and, as and when the Security Trustee may so      require, shall make such books available for inspection on behalf of the      Security Trustee, and shall furnish satisfactory evidence that the wages      and allotments and the insurance and pension contributions of the master      and crew are being promptly and regularly paid and that all deductions      from crew’s wages in respect of any tax liability or otherwise as required      by law are being properly accounted for and that the master has no claim      for disbursements other than those incurred by him in the ordinary course      of trading on the voyage then inprogress. |
|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 6.13 | Encumbrances.  The      Owner shall not without the prior written consent of the Security Trustee      (and then only subject to such conditions as the Security Trustee may      impose) mortgage, charge or otherwise encumber the Ship or any other part      of the Mortgaged Property or permit the creation of any such mortgage,      charge or other encumbrance otherwise than to or in favor of the Security      Trustee (save for such liens incurred in relation with the normal course      of the operations of the Ship). |
|------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 6.14 | Chartering.  The      Owner shall not without the prior written consent of the Security Trustee      (and then only subject to such conditions as the Security Trustee may      impose) let the Ship: |
|------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (a) | on      demise charter for any period, provided that the      foregoing shall not prohibit the Owner from demise chartering the Ship to      a Bareboat Charterer pursuant to the terms of a Bareboat Charter between      the Owner and such BareboatCharterer; |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | by      any time or consecutive voyage charter to a person other than an Affiliate      if the net time charter equivalent rate of such employment is less than      $14,000 per day and the Ship is contracted for such employment for a      period equal to or in excess of 18months; |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (c) | on      terms whereby more than two (2) months’ hire (or the equivalent) is      payable in advance; or |
|-----|---------------------------------------------------------------------------------------------------------------|

| (d) | on      any other than arm’s length terms, |
|-----|--------------------------------------------------|

|   | (i) | in      respect of the matters referred to in paragraphs (a) and (b) of this      Clause 6.14 such consent shall not be unreasonably withheld;      and |
|--------|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (ii) | in      respect of the matters referred to in paragraph (b) of this Clause 6.14,      the Security Trustee’s consent shall be deemed to have been given if the      Owner shall not have been informed by the Security Trustee orally or in      writing that such consent has been refused within two (2) Business Days of      receipt by the Security Trustee of the Owner’s application for such      consent. |
|--------|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 6.15 | Sharing of      earnings.  The Owner shall not without the prior written      consent of the Security Trustee enter into any agreement or arrangement      whereby the Earnings may be shared with any other person, provided that the      foregoing shall not prohibit or prevent the pooling and sharing of      Earnings by the Borrowers. |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 6.16 | Manager.  The      Owner shall not without the prior written consent of the Security Trustee,      such consent not to be unreasonably withheld (and then only on and subject      to such terms as the Security Trustee may approve), replace or change the      Approved Manager. |
|------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 6.17 | Costs, indemnities and      expenses.  The Owner shall pay to the Security Trustee on      its first demand all expenses which the Security Trustee has or will incur      in or in connection with: |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (a) | the      protection, maintenance or enforcement of the security created by this      Mortgage or the exercise by the Security Trustee of any of the powers      vested in it by the Loan Agreement, this Mortgage or any other Finance      Document; and |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | the      preparation, completion and registration or other perfection of this      Mortgage and any other Finance Document or otherwise in connection with      the Secured Liabilities and the security  therefor. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 6.18 | Perfection of      Mortgage.  The Ownershall: |
|------|---------------------------------------------------------|

| (a) | comply      with and satisfy all the requirements and formalities established by the      Chapter 3 of Title 21 of the Liberian Code of Laws of 1956 as amended and      any other pertinent legislation of Liberia to perfect this Mortgage as a      legal, valid and enforceable first preferred mortgage and maritime lien      upon the Ship; and |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | promptly      provide the Security Trustee from time to time with evidence in such form      as the Security Trustee requires that the Owner is complying with Clause      6.18(a). |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 6.19 | Notice of      Mortgage.  The Ownershall: |
|------|-----------------------------------------------------|

| (a) | carry      on board the Ship with its papers a certified copy of this Mortgage and      cause that certified copy of this Mortgage to be exhibited to any person      having business with the Ship which might give rise to a lien or the Ship      other than a lien for crew’s wages and salvage and to any representative      of the Security Trustee on demand;and |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | place      and maintain in a conspicuous place in the navigation room and the      Master’s cabin of the Ship a framed printed notice in plain type in      English of such size that the paragraph of reading matter shall cover a      space not less than 6 inches wide and 9 inches high reading as      follows: |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 6.20 | Conveyance on      default.  The Owner undertakes, where the Ship is (or is      to be) sold in exercise of any power contained in this Mortgage, to      execute, forthwith upon request by the Security Trustee, such form of      conveyance of the Ship as the Security Trustee may  require. |
|------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 6.21 | Compliance with laws,      etc.  The Owner covenants with the Security Trustee that      throughout the Security Period itwill: |
|------|-------------------------------------------------------------------------------------------------------------------------------------------|

| (a) | comply,      or procure compliance with, all Environmental Laws and Environmental      Permits relating to the Ship, its operation or management and the business      of the Owner from time to time, including, without limitation, maintaining      evidence of compliance with the Convention on Civil Liabilities and, if      the Ship should engage in a voyage to the United States of America or      through U.S. waters, maintaining a Certificate of Financial Responsibility      issued by the Office of Homeland Security, National Pollution Funds      Center; |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | notify      the Security Trustee forthwithupon: |
|-----|-------------------------------------------------|

|   | (i) | any      Environmental Claim being made against the Owner, the Approved Manager, an      ISM Responsible Person or otherwise in connection with the Ship;      and |
|--------|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (ii) | the      occurrence of any Environmental Incident;and |
|--------|------|-------------------------------------------------------|

| 7 | PROTECTION      OF SECURITY |
|---|-----------------------------|

| 7.1 | Security Trustee’s right to      protect or maintain security.  The Security Trustee may      take any reasonable action which it may think fit for the purpose of      protecting or maintaining the security created by this Mortgage or for any      similar or related purpose. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 7.2 | Security Trustee’s right to      insure, repair etc.  Without limiting the generality of      Clause 7.1, if the Owner does not comply with Clause 5, the Security      Trustee may: |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (a) | effect,      replace and renew any insurances; |
|-----|------------------------------------------------|

| (b) | arrange      for the carrying out of such surveys and/or repairs of the Ship as it      reasonably deems expedient or necessary;and |
|-----|-------------------------------------------------------------------------------------------------------------------------------------|

| (c) | discharge      any liabilities charged on the Ship, or otherwise relating to or affecting      it, and/or take any measures which the Security Trustee may reasonably      think expedient or necessary for the purpose of securing its      release. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 8 | ENFORCEABILITY      AND SECURITY TRUSTEE’S POWERS |
|---|---------------------------------------------------------|

| 8.1 | Right to enforce      security.  On the occurrence of an Event of Default which      is continuing but without the necessity for any court order in any      jurisdiction to the effect that an Event of Default has occurred or that      the security constituted by this Mortgage has become enforceable, and      irrespective of whether a notice has been served under Clause 13.2 of the      Loan Agreement: |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (a) | the      security constituted by this Mortgage shall immediately become      enforceable; |
|-----|-------------------------------------------------------------------------------------------|

| (b) | the      Security Trustee shall be entitled at any time or times to exercise the      powers set out in Clause 8.2 and in any other Finance      Document; |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (c) | the      Security Trustee shall be entitled at any time or times to exercise the      powers possessed by it as mortgagee of the Ship conferred by the law of      any country or territory the courts of which have or claim any      jurisdiction in respect of the Owner or the Ship;  and |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (d) | the      Security Trustee shall be entitled to exercise all the rights and remedies      in foreclosure and otherwise given to mortgagees by applicable law      including the provisions of Chapter 3 of Title 21 of the Liberian Code of      Laws of 1956, as amended. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 8.2 | Right to take possession, sell      etc.  On the occurrence of an Event of Default and whilst      the same is continuing, the Security Trustee shall be entitled then or at      any later time or times: |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (a) | to      take possession of the Ship whether actually or constructively and/or      otherwise to take control of the Ship wherever the Ship may be and cause      the Owner or any other person in possession of the Ship forthwith upon      demand to surrender the Ship to the Security Trustee without legal process      and without the Security Trustee or any other Credit Party being liable      for any losses thereby caused or to account to the Owner in connection      therewith; |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | to      sell the Ship or any share in the Ship by public auction or private      contract with or without the benefit of any charterparty or other contract      for its employment, at any time, at any place and upon any terms      (including, without limitation, on terms that all or any part or parts of      the purchase price be satisfied by shares, loan stock or other securities      and/or be left outstanding as a debt, whether secured or unsecured and      whether carrying interest or not) which the Security Trustee may think      fit, with power for the Security Trustee to purchase the Ship at any such      public auction and to set off the purchase price against all or any part      of the Secured Liabilities, with notice of such sale, whether by public      auction or private contract, addressed to the Owner at its last known      address, twenty (20) calendar days prior to the date fixed for entering      into the contract for sale and by first publishing notice of any such      public sale for ten (10) consecutive days, in daily newspapers of general      circulation published in the City of New York, State of New York, and if      the place of such sale should not be New York City, then also by      publication of a similar notice in a daily newspaper, if any, published at      the place of sale and in the event that the Vessel shall be offered by      private contract, no newspaper publication of notice shall be required,      nor notice of adjournment of sale;; |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (c) | to      manage, insure, maintain and repair the Ship and to charter, employ, lay      up or in any other manner whatsoever deal with the Ship in any manner,      upon any terms and for any period which the Security Trustee may think      fit, in all respects as if the Security Trustee were the owner of the Ship      and without the Security Trustee or any other Credit Party being      responsible for any loss therebyincurred; |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (d) | to      collect, recover and give good discharge for any moneys or claims arising      in relation to the Ship and to permit any brokers through whom collection      or recovery is effected to charge the usual brokerage      therefor; |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (e) | to      take over or commence or defend (if necessary using the name of the Owner)      any claims or proceedings relating to, or affecting, the Ship which the      Security Trustee may think fit and to abandon, release or settle in any      way any such claims or proceedings;and |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (f) | generally,      to enter into any transaction or arrangement of any kind and to do      anything in relation to the Ship which the Security Trustee may reasonably      think fit. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 8.3 | No liability of Security      Trustee.  The Security Trustee shall not be obliged to      check the nature or sufficiency of any payment received by it under this      Mortgage or to preserve, exercise or enforce any right relating to the      Ship. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 8.4 | No requirement to commence      proceedings.  Neither the Security Trustee nor any other      Credit Party will need to commence any proceedings under, or enforce any      Security Interest created by, the Loan Agreement or any other Finance      Document before commencing proceedings under, or enforcing any Security      Interest created by, this Mortgage. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 9 | APPLICATION      OF MONEYS |
|---|----------------------------|

| 9.1 | General.  All      sums received by the SecurityTrustee: |
|-----|--------------------------------------------------------------------|

| (a) | in      respect of sale of the Ship or any share in the  Ship; |
|-----|----------------------------------------------------------------|

| (b) | in      respect of net profits arising out of the employment of the Ship pursuant      to Clause 8.2(c); or |
|-----|-------------------------------------------------------------------------------------------------------------|

| (c) | in      respect of any other transaction or arrangement under Clauses 8.1 or      8.2, |
|-----|----------------------------------------------------------------------------------------|

| 10 | FURTHER      ASSURANCES |
|----|-------------------------|

| 10.1 | Owner’s obligation to execute      further documents etc.  The Owner  shall: |
|------|----------------------------------------------------------------------------------------------|

| (a) | execute      and deliver to the Security Trustee (or as it may direct) any assignment,      mortgage, power of attorney, proxy or other document, as the Security      Trustee may, in any particular case, reasonably specify;    and |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | effect      any registration or notarisation, give any notice or take any other      step, |
|-----|--------------------------------------------------------------------------------------------|

| 10.2 | Purposes of further      assurances.  The purposes referred to in Clause 10.1      are: |
|------|---------------------------------------------------------------------------------------------------|

| (a) | validly      and effectively to create any Security Interest or right of any kind which      the Security Trustee intended should be created by or pursuant to this      Mortgage; |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | to      protect the priority, or increase the effectiveness, in any jurisdiction      of any Security Interest which is created, or which the Security Trustee      intended should be created, by or pursuant to this    Mortgage; |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (c) | to      enable or assist the Security Trustee to sell or otherwise deal with the      Ship, to transfer title to, or grant any interest or right relating to,      the Ship or to exercise any power which is referred to in Clauses 8.1 or      8.2; or |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (d) | to      enable or assist the Security Trustee to enter into any transaction to      commence, defend or conduct any proceedings and/or to take any other      action relating to the Ship in any country or under the law of any      country. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.3 | Terms of further      assurances.  The Security Trustee may (subject to the      provisions of Clause 10.2) specify the terms of any document to be      executed by the Owner under Clause 10.1, and those terms may include any      covenants, undertakings, powers and provisions which the Security Trustee      reasonably considers appropriate to protect its, and any other Credit      Party’s, interests. |
|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.4 | Obligation to comply with      notice.  The Owner shall comply with a notice under      Clause 10.1 by the date specified in thenotice. |
|------|---------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.5 | Additional company      action.  At the same time as the Owner delivers to the      Security Trustee any document executed under Clause 10.1(a), the Owner      shall also deliver to the Security Trustee a certificate signed by 2 of      the Owner’s officers which shall: |
|------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (a) | set      out the text of a resolution of the Owner’s managing members specifically      authorizing the execution of the document specified by the Security      Trustee; and |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | state      that either the resolution was duly passed at a meeting of the managing      members validly convened and held throughout which a quorum of managing      members entitled to vote on the resolution was present or that the      resolution has been signed by all the managing members and is valid under      the Owner’s organizationaldocuments. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 11 | POWER      OF ATTORNEY |
|----|------------------------|

| 11.1 | Appointment.  For      the purpose of securing the Security Trustee’s interest in the Ship and      the due and punctual performance of the Owner’s obligations to the      Security Trustee under this Mortgage and every other Finance Document to      which the Owner is or is to be a party, the Owner irrevocably and by way      of security appoints the Security Trustee its attorney, on behalf of the      Owner and in its name or otherwise, to execute or sign any document and do      any act or thing which the Owner is obliged to do under any Finance      Document provided that such power shall become exercisable only after the      occurrence of an Event of Default which is  continuing. |
|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 11.2 | Ratification of actions of      attorney.  For the avoidance of doubt and without      limiting the generality of Clause 11.1, the Owner confirms that Clause      11.1 authorizes the Security Trustee to execute on its behalf a document      ratifying any transaction or action which the Security Trustee has      purported to enter into or to take and which the Security Trustee      considers was or might have been outside its powers or otherwise      invalid. |
|------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 11.3 | Delegation.  The      Security Trustee may sub-delegate to any person or persons all or any of      the powers (including the discretions) conferred on the Security Trustee      by Clauses 11.1 and/or 11.2, and may do so on terms authorizing successive      sub-delegations. |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 12 | INCORPORATION      OF LOAN AGREEMENT PROVISIONS |
|----|-------------------------------------------------|

| 12.1 | Incorporation of specific      provisions.  The following provisions of the Loan      Agreement apply to this Mortgage as if they were expressly incorporated in      this Mortgage with any necessarymodifications: |
|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 12.2 | Incorporation of general      provisions.  Clause 12.1 is without prejudice to the      application to this Mortgage of any provision of the Loan Agreement which,      by its terms, applies or relates to the Finance Documents generally or      this Mortgage specifically. |
|------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 13 | TOTAL      AMOUNT, ETC. |
|----|-------------------------|

| 13.1 | Total      amount.  For the purpose of recording this Mortgage as      required by Chapter 3 of Title 21 of the Liberian Code of Laws of 1956, as      amended, the total amount of the direct and contingent obligations secured      by this mortgage is NINETY-THREE MILLION SEVEN HUNDRED FIFTY THOUSAND      UNITED STATES DOLLARS (US$93,750,000) of which (i) SEVENTY-FIVE MILLION      UNITED STATES DOLLARS (US$75,000,000) is in respect of the Loan, and (ii)      EIGHTEEN MILLION SEVEN HUNDRED FIFTY THOUSAND UNITED STATES DOLLARS      (US$18,750,000) is in respect of the Master Agreements, together with      interest, fees, commissions and performance of mortgage      covenants.  The date of maturity of this Mortgage is January      [●], 2013. |
|------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 14 | SUPPLEMENTAL |
|----|--------------|

| 14.1 | No restriction on other      rights.  Nothing in this Mortgage shall be taken to      exclude or restrict any power, right or remedy which the Security Trustee      or any other Credit Party may at any time have  under: |
|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (a) | any      other Finance Document; or |
|-----|-------------------------------------|

| (b) | the      law of any country or territory the courts of which have or claim any      jurisdiction in respect of the Owner or the  Ship. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------|

| 14.2 | Exercise of other      rights.  The Security Trustee may exercise any right      under this Mortgage before it or any other Credit Party has exercised any      right referred to in Clause 15.1(a) or(b). |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 14.3 | Settlement or discharge      conditional.  Any settlement or discharge under this      Mortgage between the Security Trustee or any other Credit Party and the      Owner shall be conditional upon no security or payment to the Security      Trustee or any other Credit Party by the Owner or any other person being      set aside, adjusted or ordered to be repaid, whether under any insolvency      law or otherwise. |
|------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 15 | LAW      AND JURISDICTION |
|----|---------------------------|

| 15.1 | Liberian      law.  This Mortgage shall be governed by, and construed      in accordance with, Liberian law. |
|------|------------------------------------------------------------------------------------------------------------------------|

| 15.2 | Choice of      forum.  The Security Trustee reserves the      rights: |
|------|---------------------------------------------------------------------------------|

| (a) | to      commence proceedings in relation to any matter which arises out of or in      connection with this Mortgage in the courts of any country which have or      claim jurisdiction to that matter;and |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | to      commence such proceedings in the courts of any such country or countries      concurrently with or in addition to proceedings in Liberia or without      commencing proceedings in Liberia. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 15.3 | Action against      Ship.  The rights referred to in Clause 16.2 include the      right of the Security Trustee to arrest and take action against the Ship      at whatever place the Ship shall be found lying and for the purpose of any      action which the Security Trustee may bring before the courts of that      jurisdiction or other judicial authority and for the purpose of any action      which the Security Trustee may bring against the Ship, any writ, notice,      judgment or other legal process or documents may (without prejudice to any      other method of service under applicable law) be served upon the Master of      the Ship (or upon anyone acting as the Master) and such service shall be      deemed good service on the Owner for all  purposes. |
|------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 15.4 | Security Trustee’s rights      unaffected.  Nothing in this Clause 16 shall exclude or      limit any right which any Credit Party may have (whether under the law of      any country, an international convention or otherwise) with regard to the      bringing of proceedings, the service of process, the recognition or      enforcement of a judgment or any similar or related matter in any      jurisdiction. |
|------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 15.5 | Meaning of      “proceedings”.  In this Clause 16, “proceedings” means      proceedings of any kind, including an application for a provisional or      protective measure. |
|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| (a) | not      later than 11:00 a.m. (New York City time) on the due date (any payment      received after 11:00 a.m. New York City time shall be deemed to have been      paid on the next Business Day); |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | in      same day Dollar funds settled through the New York Clearing House      Interbank Payments System (or in such other Dollar funds and/or settled in      such other manner as the Payment Agent shall specify as being customary at      the time for the settlement of international transactions of the type      contemplated by this Agreement);and |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (c) | at      JP Morgan Chase Manhattan Bank, New York, ABA No. 021000021,      SWIFT:  CHASUS33, for credit to Bank of Ireland Global Markets      (Account No. 0011015815), SWIFT:  BIGTIE2D,      Reference:  Corporate Loans Administration – TBS Int., or to      such other account with such other bank as the Payment Agent may from time      to time notify to the Borrowers. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| Date   | Advance | Amount      of Principal Paid or Prepaid | Unpaid      Principal Balance | NotationMade      By |
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