kl07046_ex10-3.htm


    
      

    

     

    Exhibit
      10.3

     

     

    
      GUARANTY

       

      GUARANTY,
        dated as of July 20, 2007 (as amended, modified, restated and/or supplemented
        from time to time, this “Guaranty”), made by each of the undersigned guarantors
        (each a “Guarantor” and, together with any other entity that becomes a guarantor
        hereunder pursuant to Section 25 hereof, the “Guarantors”).  Except as
        otherwise defined herein, capitalized terms used herein and defined in the
        Credit Agreement (as defined below) shall be used herein as therein
        defined.

       

      WITNESSETH
        :

       

      WHEREAS,
        Genco Shipping & Trading Limited (the “Borrower”), the lenders from time to
        time party thereto (the “Lenders”), DnB Nor Bank ASA, New York Branch, as
        Administrative Agent and as Collateral Agent (in such capacity, together
        with
        any successor Administrative Agent, the “Administrative Agent”), have entered
        into a Credit Agreement, dated as of July 20, 2007 (as amended, modified,
        restated and/or supplemented from time to time, the “Credit Agreement”),
        providing for the making of Loans to the Borrower as contemplated therein
        (the
        Lenders, the Collateral Agent and the Administrative Agent are herein called
        the
“Lender Creditors”);

       

      WHEREAS,
        the Borrower may at any time and from time to time enter into, or guaranty
        the
        obligations of one or more other Guarantors or any of their respective
        Subsidiaries under, one or more Interest Rate Protection Agreements or Other
        Hedging Agreements with respect to the Borrower’s obligations under the Credit
        Agreement with respect to the outstanding Loans and/or Commitment from time
        to
        time with one or more Lenders or any affiliate thereof (each such Lender
        or
        affiliate, even if the respective Lender subsequently ceases to be a Lender
        under the Credit Agree­ment for any reason, together with such Lender’s or
        affiliate’s successors and assigns, if any, collectively, the “Other Creditors”
and, together with the Lender Creditors, the “Secured Creditors”);

       

      WHEREAS,
        each Guarantor is a direct or indirect Subsidiary of the Borrower;

       

      WHEREAS,
        it is a condition to the making of Loan in respect of the Capesize Vessels
        and
        other Loans to the Borrower under the Credit Agreement that each Guarantor
        shall
        have executed and delivered this Guaranty; and

       

      WHEREAS,
        each Guarantor will obtain benefits from the incurrence of Loans to the Borrower
        under the Credit Agreement and the entering into by the Borrower of Interest
        Rate Protection Agreements or Other Hedging Agreements and, accordingly,
        desires
        to execute this Guaranty in order to satisfy the conditions described in
        the
        preceding paragraph;

       

       

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

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      NOW,
        THEREFORE, in consideration of the foregoing and other benefits accruing
        to each
        Guarantor, the receipt and sufficiency of which are hereby acknowledged,
        each
        Guarantor hereby makes the following representations and warranties to the
        Secured Creditors and hereby covenants and agrees with each Secured Creditor
        as
        follows:

       

      1.  Each
        Guarantor, jointly and severally, irrevocably, absolutely and unconditionally
        guarantees:  (i) to the Lender Creditors the full and prompt payment
        when due (whether at the stated maturity, by acceleration or otherwise) of
        (x)
        the principal of, premium, if any, and interest on the Notes issued by, and
        the
        Loans made to, the Borrower under the Credit Agreement, and (y) all other
        obligations (including obligations which, but for the automatic stay under
        Section 362(a) of the Bankruptcy Code, would become due), liabilities and
        indebtedness owing by the Borrower to the Lender Creditors (in the capacities
        referred to in the definition of Lender Creditors) under the Credit Agreement
        and each other Credit Document to which the Borrower is a party (including,
        without limitation, indemnities, fees and interest thereon (including any
        interest accruing after the commencement of any bankruptcy, insolvency,
        receivership or similar proceeding at the rate provided for in the Credit
        Agreement, whether or not such interest is an allowed claim in any such
        proceeding)), whether now existing or hereafter incurred under, arising out
        of
        or in connection with the Credit Agreement and any such other Credit Document
        and the due performance and compliance by the Borrower with all of the terms,
        conditions and agreements contained in all such Credit Documents (all such
        principal, premium, interest, liabilities, indebtedness and obligations being
        herein collectively called the “Credit Document Obligations”); and (ii) to each
        Other Creditor the full and prompt payment when due (whether at the stated
        maturity, by acceleration or otherwise) of all obligations (including
        obligations which, but for the automatic stay under Section 362(a) of the
        Bankruptcy Code, would become due), liabilities and indebtedness (including
        any
        interest accruing after the commencement of any bankruptcy, insolvency,
        receivership or similar proceeding at the rate provided for in the respective
        Interest Rate Protection Agreements or Other Hedging Agreements, whether
        or not
        such interest is an allowed claim in any such proceeding) owing by the Borrower
        under any Interest Rate Protection Agreement or Other Hedging Agreement entered
        into in respect of the Borrower’s obligations with respect to the outstanding
        Loans and/or Commitments from time to time, whether now in existence or
        hereafter arising, and the due performance and compliance by the Borrower
        with
        all of the terms, conditions and agreements contained in each such Interest
        Rate
        Protection Agreement and Other Hedging Agreement to which it is a party (all
        such obligations, liabilities and indebtedness being herein collectively
        called
        the “Other Obligations” and, together with the Credit Document Obligations, the
“Guaranteed Obligations”).  As used herein, the term “Guaranteed
        Party” shall mean the Borrower party to or as guarantor of any Guarantor or its
        Subsidiaries party to any Interest Rate Protection Agreement or Other Hedging
        Agreement with an Other Creditor.  Each Guarantor understands, agrees
        and confirms that the Secured Creditors may enforce this Guaranty up to the
        full
        amount of the Guaranteed Obligations against such Guarantor without proceeding
        against any other Guarantor, the Borrower, any other Guaranteed Party, against
        any security for the Guaranteed Obligations, or under any other guaranty
        covering all or a portion of the Guaranteed Obligations.

       

       

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      
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      2.  Additionally,
        each Guarantor, jointly and severally, unconditionally, absolutely and
        irrevocably, guarantees the payment of any and all Guaranteed Obligations
        whether or not due or payable by the Borrower or any other Guaranteed Party
        upon
        the occurrence in respect of the Borrower or any such other Guaranteed Party
        of
        any of the events specified in Section 10.05 of the Credit Agreement, and
        unconditionally and irrevocably, jointly and severally, promises to pay such
        Guaranteed Obligations to the Secured Creditors, or order, on
        demand.  This Guaranty shall constitute a guaranty of payment, and not
        of collection.

       

      3.  The
        liability of each Guarantor hereunder is primary, absolute, joint and several,
        and unconditional and is exclusive and independent of any security for or
        other
        guaranty of the indebtedness of the Borrower or any other Guaranteed Party
        whether executed by such Guarantor, any other Guarantor, any other guarantor
        or
        by any other party, and the liability of each Guarantor hereunder shall not
        be
        affected or impaired by any circumstance or occurrence whatsoever, including,
        without limitation:  (a) any direction as to application of payment by
        the Borrower or any other Guaranteed Party or by any other party, (b) any
        other
        continuing or other guaranty, undertaking or maximum liability of a guarantor
        or
        of any other party as to the Guaranteed Obligations, (c) any payment on or
        in
        reduction of any such other guaranty or undertaking, (d) any dissolution,
        change
        in corporate structure, termination or increase, decrease or change in
        personnel, by the Borrower or any other Guaranteed Party, (e) to the extent
        permitted by applicable law, any payment made to any Secured Creditor on
        the
        indebtedness which any Secured Creditor repays the Borrower or any other
        Guaranteed Party pursuant to court order in any bankruptcy, reorganization,
        arrangement, moratorium or other debtor relief proceeding, and each Guarantor
        waives any right to the deferral or modification of its obligations hereunder
        by
        reason of any such proceeding, (f) any action or inaction by the Secured
        Creditors as contemplated in Section 6 hereof or (g) any invalidity,
        irregularity or unenforceability of all or any part of the Guaranteed
        Obligations or of any security therefor, including, without limitation, any
        such
        invalidity, irregularity or unenforceability caused by a change in
        law.

       

      4.  The
        obligations of each Guarantor hereunder are independent of the obligations
        of
        any other Guarantor, any other guarantor, the Borrower or any other Guaranteed
        Party, and a separate action or actions may be brought and prosecuted against
        each Guarantor whether or not action is brought against any other Guarantor,
        any
        other guarantor, the Borrower or any other Guaranteed Party and whether or
        not
        any other Guarantor, any other guarantor, the Borrower or any other Guaranteed
        Party be joined in any such action or actions.  Each Guarantor waives,
        to the fullest extent permitted by law, the benefits of any statute of
        limitations affecting its liability hereunder or the enforcement
        thereof.  Any payment by the Borrower or any other Guaranteed Party or
        other circumstance which operates to toll any statute of limitations as to
        the
        Borrower or any other Guaranteed Party shall operate to toll the statute
        of
        limitations as to each Guarantor.

       

      5.  Any
        Secured Creditor may at any time and from time to time without the consent
        of,
        or notice to, any Guarantor, without incurring responsibility to such Guarantor,
        without impairing or releasing the obligations of such Guarantor hereunder,
        upon
        or without any terms or conditions and in whole or in part:

       

       

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      
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          4

      

       

      (a)  change
        the manner, place or terms of payment of, and/or change, increase or extend
        the
        time of payment of, renew or alter, any of the Guaranteed Obligations (including
        any increase or decrease in the rate of interest thereon or the principal
        amount
        thereof), any security therefor, or any liability incurred directly or
        indirectly in respect thereof, and the guaranty herein made shall apply to
        the
        Guaranteed Obligations as so changed, extended, renewed or altered;

       

      (b)  take
        and hold security for the payment of the Guaranteed Obligations and sell,
        exchange, release, surrender, impair, realize upon or otherwise deal with
        in any
        manner and in any order any property by whomsoever at any time pledged or
        mortgaged to secure, or howsoever securing, the Guaranteed Obligations or
        any
        liabilities (including any of those hereunder) incurred directly or indirectly
        in respect thereof or hereof, and/or any offset there against;

       

      (c)  exercise
        or refrain from exercising any rights against the Borrower, any
        other  Guaranteed Party, any other Credit Party, any Subsidiary
        thereof or otherwise act or refrain from acting;

       

      (d)  release
        or substitute any one or more endorsers, Guarantors, other guarantors, the
        Borrower, any other Guaranteed Party, or other obligors;

       

      (e)  settle
        or compromise any of the Guaranteed Obligations, any security therefor or
        any
        liability (including any of those hereunder) incurred directly or indirectly
        in
        respect thereof or hereof, and may subordinate the payment of all or any
        part
        thereof to the payment of any liability (whether due or not) of the Borrower
        or
        any other Guaranteed Party to creditors of the Borrower or such other Guaranteed
        Party other than the Secured Creditors;

       

      (f)  apply
        any sums by whomsoever paid or howsoever realized to any liability or
        liabilities of the Borrower or any other Guaranteed Party to the Secured
        Creditors regardless of what liabilities of the Borrower or such other
        Guaranteed Party remain unpaid;

       

      (g)  consent
        to or waive any breach of, or any act, omission or default under, any of
        the
        Interest Rate Protection Agreements or Other Hedging Agreements, the Credit
        Documents or any of the instruments or agreements referred to therein, or
        otherwise amend, modify or supplement (in accordance with their terms) any
        of
        the Interest Rate Protection Agreements or Other Hedging Agreements, the
        Credit
        Documents or any of such other instruments or agreements;

       

      (h)  act
        or fail to act in any manner which may deprive such Guarantor of its right
        to
        subrogation against the Borrower or any other Guaranteed Party to recover
        full
        indemnity for any payments made pursuant to this Guaranty; and/or

       

      (i)  take
        any other action which would, under otherwise applicable principles of common
        law, give rise to a legal or equitable discharge of such Guarantor from its
        liabilities under this Guaranty.

       

      6.  This
        Guaranty is a continuing one and all liabilities to which it applies or may
        apply under the terms hereof shall be conclusively presumed to have been
        created
        in reliance

       

       

       

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      
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      hereon.  No
        failure or delay on the part of any Secured Creditor in exercising any right,
        power or privilege hereunder shall operate as a waiver thereof, nor shall
        any
        single or partial exercise of any right, power or privilege hereunder preclude
        any other or further exercise thereof or the exercise of any other right,
        power
        or privilege hereunder.  The rights and remedies herein expressly
        specified are cumulative and not exclusive of any rights or remedies which
        any
        Secured Creditor would otherwise have hereunder.  No notice to or
        demand on any Guarantor in any case shall entitle such Guarantor to any other
        further notice or demand in similar or other circumstances or constitute
        a
        waiver of the rights of any Secured Creditor to any other or further action
        in
        any circumstances without notice or demand.  It is not necessary for
        any Secured Creditor to inquire into the capacity or powers of the Borrower
        or
        any other Guaranteed Party or the officers, directors, partners or agents
        acting
        or purporting to act on its or their behalf, and any indebtedness made or
        created in reliance upon the professed exercise of such powers shall be
        guaranteed hereunder.

       

      7.  Any
        indebtedness of the Borrower or any other Guaranteed Party now or hereafter
        held
        by any Guarantor is hereby subordinated to the indebtedness of the Borrower
        or
        such other Guaranteed Party to the Secured Creditors, and such indebtedness
        of
        the Borrower or such other Guaranteed Party to any Guarantor, if the
        Administrative Agent or the Collateral Agent, after the occurrence and during
        the continuance of an Event of Default, so requests, shall be collected,
        enforced and received by such Guarantor as trustee for the Secured Creditors
        and
        be paid over to the Secured Creditors on account of the indebtedness of the
        Borrower or the other Guaranteed Parties to the Secured Creditors, but without
        affecting or impairing in any manner the liability of such Guarantor under
        the
        other provisions of this Guaranty.  Without limiting the generality of
        the foregoing, each Guarantor hereby agrees with the Secured Creditors that
        it
        will not exercise any right of subrogation which it may at any time otherwise
        have as a result of this Guaranty (whether contractual, under Section 509
        of the
        Bankruptcy Code or otherwise) until all Guaranteed Obligations have been
        irrevocably paid in full in cash.

       

      8.  (a)  Each
        Guarantor waives any right (except as shall be required by applicable law
        and
        cannot be waived) to require the Secured Creditors to:  (i) proceed
        against the Borrower, any other Guaranteed Party, any other Guarantor, any
        other
        guarantor of the Guaranteed Obligations or any other party; (ii) proceed
        against
        or exhaust any security held from the Borrower, any other Guaranteed Party,
        any
        other Guarantor, any other guarantor of the Guaranteed Obligations or any
        other
        party; or (iii) pursue any other remedy in the Secured Creditors’ power
        whatsoever.  Each Guarantor waives any defense based on or arising out
        of any defense of the Borrower, any other Guaranteed Party, any other Guarantor,
        any other guarantor of the Guaranteed Obligations or any other party other
        than
        payment in full of the Guaranteed Obligations, including, without limitation,
        any defense based on or arising out of the disability of the Borrower, any
        other
        Guaranteed Party, any other Guarantor, any other guarantor of the Guaranteed
        Obligations or any other party, or the unenforceability of the Guaranteed
        Obligations or any part thereof from any cause, or the cessation from any
        cause
        of the liability of the Borrower or any other Guaranteed Party other than
        payment in full of the Guaranteed Obligations.  The Secured Creditors
        may, at their election, foreclose on any security held by the Administrative
        Agent, the Collateral Agent or the other Secured Creditors by one or more
        judicial or nonjudicial sales, whether or not every aspect of any such sale
        is
        commercially

       

       

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

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      reasonable,
        or exercise any other right or remedy the Secured Creditors may have against
        the
        Borrower, any other Guaranteed Party or any other party, or any security,
        without affecting or impairing in any way the liability of any Guarantor
        hereunder except to the extent the Guaranteed Obligations have been paid
        in full
        in cash.  Each Guarantor waives any defense arising out of any such
        election by the Secured Creditors, even though such election operates to
        impair
        or extinguish any right of reimbursement or subrogation or other right or
        remedy
        of such Guarantor against the Borrower, any other Guaranteed Party or any
        other
        party or any security.

       

      (b)  Each
        Guarantor waives all presentments, promptness, diligence, demands for
        performance, protests and notices, including, without limitation, notices
        of
        nonperformance, notices of protest, notices of dishonor, notices of acceptance
        of this Guaranty, and notices of the existence, creation or incurring of
        new or
        additional indebtedness.  Each Guarantor assumes all responsibility
        for being and keeping itself informed of the Borrower’s and each other
        Guaranteed Party’s financial condition and assets, and of all other
        circumstances bearing upon the risk of nonpayment of the Guaranteed Obligations
        and the nature, scope and extent of the risks which such Guarantor assumes
        and
        incurs hereunder, and agrees that the Secured Creditors shall have no duty
        to
        advise any Guarantor of information known to them regarding such circumstances
        or risks.

       

      Each
        Guarantor warrants and agrees that each of the waivers set forth above in
        this
        Section 8 is made with full knowledge of its significance and consequences
        and
        that if any of such waivers are determined to be contrary to any applicable
        law
        or public policy, such waivers shall be effective only to the maximum extent
        permitted by law.

       

      9.  
        (a)      The Secured Creditors agree that this
        Guaranty may be enforced only by the action of the Administrative Agent or
        the
        Collateral Agent, in each case acting upon the instructions of the Lenders
        (or,
        after the date on which all Credit Document Obligations have been paid in
        full,
        the holders of at least a majority of the outstanding Other Obligations)
        and
        that no other Secured Creditors shall have any right individually to seek
        to
        enforce or to enforce this Guaranty, it being understood and agreed that
        such
        rights and remedies may be exercised by the Administrative Agent or the
        Collateral Agent or, after all the Credit Document Obligations have been
        paid in
        full, by the holders of at least a majority of the outstanding Other
        Obligations, as the case may be, for the benefit of the Secured Creditors
        upon
        the terms of this Guaranty.  The Secured Creditors further agree that
        this Guaranty may not be enforced against any director, officer, employee,
        partner, member or stockholder of any Guarantor (except to the extent such
        partner, member or stockholder is also a Guarantor hereunder).

       

           
        (b)     The Administrative Agent and Collateral Agent
        will hold in accordance with this Guaranty all collateral at any time received
        under this Guaranty.  It is expressly understood and agreed by each
        Secured Creditor that by accepting the benefits of this Guaranty each such
        Secured Creditor acknowledges and agrees that the obligations of the
        Administrative Agent and Collateral Agent as enforcer of this Guaranty and
        interests herein are only those expressly set forth in this Guaranty and
        in
        Section 12 of the Credit Agreement.  The Administrative Agent and the
        Collateral Agent shall act hereunder on the terms and conditions set forth
        herein and in Section 12 of the Credit Agreement.

       

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

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      10.  In
        order to induce the Lenders to make Loans to the Borrower pursuant to the
        Credit
        Agreement, and in order to induce the Other Creditors to execute, deliver
        and
        perform the Interest Rate Protection Agreements and Other Hedging Agreements,
        each Guarantor represents, warrants and covenants that:

       

      (a)  Such
        Guarantor (i) is a duly organized and validly existing corporation, limited
        partnership or limited liability company, as the case may be, in good standing
        under the laws of the jurisdiction of its incorporation or formation, (ii)
        has
        the corporate or other applicable power and authority, as the case may be,
        to
        own its property and assets and to transact the business in which it is
        currently engaged and presently proposes to engage and (iii) is duly qualified
        and is authorized to do business and is in good standing in each jurisdiction
        where the conduct of its business as currently conducted requires such
        qualification, except for failures to be so qualified which, individually
        or in
        the aggregate, could not reasonably be expected to have a Material Adverse
        Effect.

       

      (b)  Such
        Guarantor has the corporate or other applicable power and authority to execute,
        deliver and perform the terms and provisions of this Guaranty and each other
        Credit Document to which it is a party and has taken all necessary corporate
        or
        other applicable action to authorize the execution, delivery and performance
        by
        it of this Guaranty and each such other Credit Document.  Such
        Guarantor has duly executed and delivered this Guaranty and each other Credit
        Document to which it is a party, and this Guaranty and each such other Credit
        Document constitutes the legal, valid and binding obligation of such Guarantor
        enforceable against such Guarantor in accordance with its terms, except to
        the
        extent that the enforceability hereof or thereof may be limited by applicable
        bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium
        or
        other similar laws generally affecting creditors’ rights and by equitable
        principles (regardless of whether enforcement is sought in equity or at
        law).

       

      (c)  Neither
        the execution, delivery or performance by such Guarantor of this Guaranty
        or any
        other Credit Document to which it is a party, nor compliance by it with the
        terms and provisions hereof and thereof, will (i) contravene any provision
        of
        any applicable law, statute, rule or regulation or any applicable order,
        writ,
        injunction or decree of any court or governmental instrumentality, (ii) conflict
        with or result in any breach of any of the terms, covenants, conditions or
        provisions of, or constitute a default under, or result in the creation or
        imposition of (or the obligation to create or impose) any Lien (except pursuant
        to the Security Documents) upon any of the material properties or assets
        of such
        Guarantor or any of its Subsidiaries pursuant to the terms of any indenture,
        mortgage, deed of trust, loan agreement or credit agreement, or any other
        material agreement, contract or instrument, to which such Guarantor or any
        of
        its Subsidiaries is a party or by which it or any of its material property
        or
        assets is bound or to which it may be subject or (iii) violate any provision
        of
        the Certificate of Incorporation or By-Laws (or equivalent organizational
        documents) of such Guarantor or any of its Subsidiaries.

       

      (d)  No
        order, consent, approval, license, authorization or validation of, or filing,
        recording or registration with (except as have been obtained or made or,
        in the
        case of any filings or recordings of the Security Documents (other than the
        Vessel Mortgages) executed on or before 

       

       

       

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

       

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      the
        Initial Borrowing Date, will be made within 10 days of the Initial Borrowing
        Date), or exemption by, any governmental or public body or authority, or
        any
        subdivision thereof, is required to authorize, or is required in connection
        with, (i) the execution, delivery and performance of this Guaranty by such
        Guarantor or any other Credit Document to which such Guarantor is a party
        or
        (ii) the legality, validity, binding effect or enforceability of this Guaranty
        or any other Credit Document to which such Guarantor is a party.

       

      (e)  There
        are no actions, suits, investigations or proceedings pending or, to such
        Guarantor’s knowledge, threatened (i) with respect to this Guaranty or any other
        Credit Document to which such Guarantor is a party or (ii) with respect to
        such
        Guarantor or any of its Subsidiaries that, either individually or in the
        aggregate, could reasonably be expected to have a Material Adverse
        Effect.

       

      11.  Each
        Guarantor covenants and agrees that on and after the Effective Date and until
        the termination of the Commitments and all Interest Rate Protection Agreements
        and Other Hedging Agreements entered into with respect to the Loans and until
        such time as no Term Notes and no Revolving Notes remain outstanding and
        all
        Guaranteed Obligations have been paid in full, such Guarantor will comply,
        and
        will cause each of its Subsidiaries to comply, with all of the applicable
        provisions, covenants and agreements contained in Sections 8 and 9 of the
        Credit
        Agreement, and will take, or will refrain from taking, as the case may be,
        all
        actions that are necessary to be taken or not taken so that it is not in
        violation of any provision, covenant or agreement contained in Section 8
        or 9 of
        the Credit Agreement, and so that no Default or Event of Default is caused
        by
        the actions of such Guarantor or any of its Subsidiaries.

       

      12.  The
        Guarantors hereby jointly and severally agree to pay all reasonable
        out-of-pocket costs and expenses of (i) each Secured Creditor in connection
        with
        the enforcement of this Guaranty (including, without limitation, the reasonable
        fees and disbursements of counsel employed by each Secured Creditor) and
        (ii)
        the Administrative Agent in connection with any amendment, waiver or consent
        relating hereto (including, without limitation, the reasonable fees and
        disbursements of counsel employed by the Administrative Agent).

       

      13.  This
        Guaranty shall be binding upon each Guarantor and its successors and assigns
        and
        shall inure to the benefit of the Secured Creditors and their successors
        and
        assigns.

       

      14.  Neither
        this Guaranty nor any provision hereof may be changed, waived, discharged
        or
        terminated except with the written consent of each Guarantor directly affected
        thereby and with the written consent of (x) the Administrative Agent (or,
        to the
        extent required by Section 13.12 of the Credit Agreement, with the written
        consent of the Required Lenders) at all times prior to the time on which
        all
        Credit Document Obligations have been paid in full or (y) the holders of
        at
        least a majority of the outstanding Other Obligations at all times after
        the
        time on which all Credit Document Obligations have been paid in full;
provided, that any change, waiver, modification or variance affecting the
        rights and benefits of a single Class (as defined below) of Secured Creditors
        (and not all Secured Creditors in a like or similar manner) shall also require
        the written consent of the Requisite Creditors (as defined below) of such
        Class
        of Secured Creditors (it being understood that the addition or release of
        any
        Guarantor hereunder

       

       

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      
        page
          9

      

       

      shall
        not
        constitute a change, waiver, discharge or termination affecting any Guarantor
        other than the Guarantor so added or released).  For the purpose of
        this Guaranty, the term “Class” shall mean each class of Secured Creditors,
i.e., whether (x) the Lender Creditors as holders of the Credit Document
        Obligations or (y) the Other Creditors as the holders of the Other
        Obligations.  For the purpose of this Guaranty, the term “Requisite
        Creditors” of any Class shall mean (x) with respect to the Credit Document
        Obligations, the Required Lenders (or, to the extent required by Section
        13.12
        of the Credit Agreement, each Lender) and (y) with respect to the Other
        Obligations, the holders of at least a majority of all obligations outstanding
        from time to time under the Interest Rate Protection Agreements and Other
        Hedging Agreements entered into with respect to the Loans (and/or the
        Commitments).

       

      15.  Each
        Guarantor acknowledges that an executed (or conformed) copy of each of the
        Credit Documents and each existing Interest Rate Protection Agreements or
        Other
        Hedging Agreements has been made available to a senior officer of such Guarantor
        and such officer is familiar with the contents thereof.

       

      16.  In
        addition to any rights now or hereafter granted under applicable law (including,
        without limitation, Section 151 of the New York Debtor and Secured Creditor
        Law)
        and not by way of limitation of any such rights, upon the occurrence and
        during
        the continuance of an Event of Default (such term to mean and include any
“Event
        of Default” as defined in the Credit Agreement and any payment default under any
        Interest Rate Protection Agreement or Other Hedging Agreement continuing
        after
        any applicable grace period), each Secured Creditor is hereby authorized,
        at any
        time or from time to time, without notice to any Guarantor or to any other
        Person, any such notice being expressly waived, to set off and to appropriate
        and apply any and all deposits (general or special) and any other indebtedness
        at any time held or owing by such Secured Creditor to or for the credit or
        the
        account of such Guarantor, against and on account of the obligations and
        liabilities of such Guarantor to such Secured Creditor under this Guaranty,
        irrespective of whether or not such Secured Creditor shall have made any
        demand
        hereunder and although said obligations, liabilities, deposits or claims,
        or any
        of them, shall be contingent or unmatured.

       

      17.  Except
        as otherwise expressly provided herein, all notices and other communications
        provided for hereunder shall be in writing (including telexed, telegraphic
        or
        telecopier communication) and mailed, telexed, telecopied or
        delivered:  if to any Guarantor, at c/o Genco Ship Management LLC., as
        agent, 35 West 56th Street,
        New York,
        New York 10019; if to any Secured Creditor, at its address specified opposite
        its name on Schedule II to the Credit Agreement; and if to the Administrative
        Agent, at its address specified opposite its name on Schedule II to the Credit
        Agreement; or, as to any other Credit Party, at such other address as shall
        be
        designated by such party in a written notice to the other parties hereto
        and, as
        to each Secured Creditor, at such other address as shall be designated by
        such
        Secured Creditor in a written notice to the Borrower and the Administrative
        Agent.  All such notices and communications shall, (i) when mailed, be
        effective three Business Days after being deposited in the mails, prepaid
        and
        properly addressed for delivery, (ii) when sent by overnight courier, be
        effective one Business Day after delivery to the overnight courier prepaid
        and
        properly addressed for delivery on such next Business Day, or (iii) when
        sent by
        telex or telecopier, be effective 

       

       

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

       

      
        page
          10

      

       

      when
        sent
        by telex or telecopier, except that notices and communications to the
        Administrative Agent or any Guarantor shall not be effective until received
        by
        the Administrative Agent or such Guarantor, as the case may be.

      


      18.  If
        claim is ever made upon any Secured Creditor for repayment or recovery of
        any
        amount or amounts received in payment or on account of any of the Guaranteed
        Obligations and any of the aforesaid payees repays all or part of said amount
        by
        reason of (i) any judgment, decree or order of any court or administrative
        body
        having jurisdiction over such payee or any of its property or (ii) any
        settlement or compromise of any such claim effected by such payee with any
        such
        claimant (including the Borrower or any other Guaranteed Party) then and
        in such
        event each Guarantor agrees that any such judgment, decree, order, settlement
        or
        compromise shall be binding upon such Guarantor, notwithstanding any revocation
        hereof or other instrument evidencing any liability of the Borrower or any
        other
        Guaranteed Party, and such Guarantor shall be and remain liable to the aforesaid
        payees hereunder for the amount so repaid or recovered to the same extent
        as if
        such amount had never originally been received by any such payee.

       

      19.  (a)  THIS
        SUBSIDIARIES GUARANTY AND THE OTHER CREDIT DOCUMENTS AND THE RIGHTS AND
        OBLIGATIONS OF THE PARTIES HEREUNDER AND THEREUNDER SHALL, EXCEPT AS OTHERWISE
        PROVIDED IN CERTAIN OF THE VESSEL MORTGAGES, BE CONSTRUED IN ACCORDANCE WITH
        AND
        BE GOVERNED BY THE LAW OF THE STATE OF NEW YORK WITHOUT REGARD TO ITS CONFLICT
        OF LAWS RULES (OTHER THAN TITLE 14 OF ARTICLE 5 OF THE GENERAL OBLIGATIONS
        LAW).  Any legal action or proceeding with respect to this
        Guaranty or any other Credit Document to which any Guarantor is a party may
        be
        brought in the courts of the State of New York or of the United States of
        America for the Southern District of New York in each case which are located
        in
        the City of New York, and, by execution and delivery of this Guaranty, each
        Guarantor hereby irrevocably accepts for itself and in respect of its property,
        generally and unconditionally, the jurisdiction of the aforesaid
        courts.  Each Guarantor hereby further irrevocably waives (to the
        fullest extent permitted by applicable law) any claim that any such court
        lacks
        personal jurisdiction over such Guarantor, and agrees not to plead or claim
        in
        any legal action or proceeding with respect to this Guaranty or any other
        Credit
        Document to which such Guarantor is a party brought in any of the aforesaid
        courts that any such court lacks personal jurisdiction over such
        Guarantor.  Each Guarantor further irrevocably consents to the service
        of process out of any of the aforementioned courts in any such action or
        proceeding by the mailing of copies thereof by registered or certified mail,
        postage prepaid, to such Guarantor at its address set forth in Section 17
        hereof, such service to become effective 30 days after such
        mailing.  Each Guarantor hereby irrevocably waives (to the fullest
        extent permitted by applicable law) any objection to such service of process
        and
        further irrevocably waives and agrees not to plead or claim in any action
        or
        proceeding commenced hereunder or under any other Credit Document to which
        such
        Guarantor is a party that such service of process was in any way invalid
        or
        ineffective. Nothing herein shall affect the right of any of the Secured
        Creditors to serve process in any other manner permitted by law or to commence
        legal proceedings or otherwise proceed against each Guarantor in any other
        jurisdiction.

       

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      
        page
          11

      

       

      (b)  Each
        Guarantor hereby irrevocably waives (to the fullest extent permitted by
        applicable law) any objection which it may now or hereafter have to the laying
        of venue of any of the aforesaid actions or proceedings arising out of or
        in
        connection with this Guaranty or any other Credit Document to which such
        Guarantor is a party brought in the courts referred to in clause (a) above
        and
        hereby further irrevocably waives (to the fullest extent permitted by applicable
        law) and agrees not to plead or claim in any such court that such action
        or
        proceeding brought in any such court has been brought in an inconvenient
        forum.

       

      (c)  EACH
        GUARANTOR AND EACH SECURED CREDITOR (BY ITS ACCEPTANCE OF THE BENEFITS OF
        THIS
        GUARANTY) HEREBY IRREVOC­ABLY WAIVES ALL RIGHTS TO A TRIAL BY JURY IN ANY
        ACTION, PRO­CEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS
        GUARANTY, THE OTHER CREDIT DOCUMENTS TO WHICH SUCH GUARANTOR IS A PARTY OR
        THE
        TRANSACTIONS CONTEMPLATED HERE­BY OR THEREBY.

       

      20.  In
        the event that all of the capital stock or other equity interests of one
        or more
        Guarantors is sold or otherwise disposed of or liquidated in compliance with
        the
        requirements of Section 11.02 of the Credit Agreement (or such sale or other
        disposition has been approved in writing by the Required Lenders (or all
        the
        Lenders if required by Section 15.12 of the Credit Agreement)) and the proceeds
        of such sale, disposition or liquidation are applied in accordance with the
        provisions of the Credit Agreement, to the extent applicable, such Guarantor
        shall upon consummation of such sale or other disposition (except to the
        extent
        that such sale or disposition is to the Borrower or another Subsidiary thereof)
        be released from this Guaranty automatically and without further action and
        this
        Guaranty shall, as to each such Guarantor or Guarantors, terminate, and have
        no
        further force or effect (it being understood and agreed that the sale of
        one or
        more Persons that own, directly or indirectly, all of the capital stock or
        other
        equity interests of any Guarantor shall be deemed to be a sale of such Guarantor
        for the purposes of this Section 20).

       

      21.  At
        any time a payment in respect of the Guaranteed Obligations is made under
        this
        Guaranty, the right of contribution of each Guarantor against each other
        Guarantor shall be determined as provided in the immediately following sentence,
        with the right of contribution of each Guarantor to be revised and restated
        as
        of each date on which a payment (a “Relevant Payment”) is made on the Guaranteed
        Obligations under this Guaranty.  At any time that a Relevant Payment
        is made by a Guarantor that results in the aggregate payments made by such
        Guarantor in respect of the Guaranteed Obligations to and including the date
        of
        the Relevant Payment exceeding such Guarantor’s Contribution Percentage (as
        defined below) of the aggregate payments made by all Guarantors in respect
        of
        the Guaranteed Obligations to and including the date of the Relevant Payment
        (such excess, the “Aggregate Excess Amount”), each such Guarantor shall have a
        right of contribution against each other Guarantor who has made payments
        in
        respect of the Guaranteed Obligations to and including the date of the Relevant
        Payment in an aggregate amount less than such other Guarantor’s Contribution
        Percentage of the aggregate payments made to and including the date of the
        Relevant Payment by all Guarantors in respect of the Guaranteed Obligations
        (the
        aggregate amount of such deficit, the “Aggregate Deficit Amount”) in an amount
        equal to (x) a fraction the numerator of which is the Aggregate

       

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      
        page
          12

      

       

      Excess
        Amount of such Guarantor and the denominator of which is the Aggregate Excess
        Amount of all Guarantors multiplied by (y) the Aggregate Deficit Amount of
        such
        other Guarantor.  A Guarantor’s right of contribution pursuant to the
        preceding sentences shall arise at the time of each computation, subject
        to
        adjustment to the time of each computation; provided, that no Guarantor
        may take any action to enforce such right until the Guaranteed Obligations
        have
        been paid in full in cash, it being expressly recognized and agreed by all
        parties hereto that any Guarantor’s right of contribution arising pursuant to
        this Section 21 against any other Guarantor shall be expressly junior and
        subordinate to such other Guarantor’s obligations and liabilities in respect of
        the Guaranteed Obligations and any other obligations owing under this
        Guaranty.  As used in this Section 21:  (i) each Guarantor’s
“Contribution Percentage” shall mean the percentage obtained by dividing (x) the
        Adjusted Net Worth (as defined below) of such Guarantor by (y) the aggregate
        Adjusted Net Worth of all Guarantors; (ii) the “Adjusted Net Worth” of each
        Guarantor shall mean the greater of (x) the Net Worth (as defined below)
        of such
        Guarantor and (y) zero; and (iii) the “Net Worth” of each Guarantor shall mean
        the amount by which the fair saleable value of such Guarantor’s assets on the
        date of any Relevant Payment exceeds its existing debts and other liabilities
        (including contingent liabilities, but without giving effect to any Guaranteed
        Obligations arising under this Guaranty or any guaranteed obligations arising
        under any guaranty of the Senior Notes) on such date.  All parties
        hereto recognize and agree that, except for any right of contribution arising
        pursuant to this Section 21, each Guarantor who makes any payment in respect
        of
        the Guaranteed Obligations shall have no right of contribution or subrogation
        against any other Guarantor in respect of such payment until all of the
        Guaranteed Obligations have been irrevocably paid in full in
        cash.  Each of the Guarantors recognizes and acknowledges that the
        rights to contribution arising hereunder shall constitute an asset in favor
        of
        the party entitled to such contribution.  In this connection, each
        Guarantor has the right to waive its contribution right against any Guarantor
        to
        the extent that after giving effect to such waiver such Guarantor would remain
        solvent, in the determination of the Required Lenders.

       

      22.  Each
        Guarantor and each Secured Creditor (by its acceptance of the benefits of
        this
        Guaranty) hereby confirms that it is its intention that this Guaranty not
        constitute a fraudulent transfer or conveyance for purposes of the Bankruptcy
        Code, the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent Transfer
        Act
        or any similar Federal, state or other law.  To effectuate the
        foregoing intention, each Guarantor and each Secured Creditor (by its acceptance
        of the benefits of this Guaranty) hereby irrevocably agrees that the Guaranteed
        Obligations guaranteed by such Guarantor shall be limited to such amount
        as
        will, after giving effect to such maximum amount and all other (contingent
        or
        otherwise) liabilities of such Guarantor that are relevant under such laws
        and
        after giving effect to any rights to contribution pursuant to any agreement
        providing for an equitable contribution among such Guarantor and the other
        Guarantors, result in the Guaranteed Obligations of such Guarantor in respect
        of
        such maximum amount not constituting a fraudulent transfer or
        conveyance.

       

      23.  This
        Guaranty may be executed in any number of counterparts and by the different
        parties hereto on separate counterparts, each of which when so executed and
        delivered shall be an original (including if delivered by facsimile
        transmission), but all of which shall 

       

       

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      page
        13

       

       

      together
        constitute one and the same instrument.  A set of counterparts
        executed by all the parties hereto shall be lodged with the Guarantors and
        the
        Administrative Agent.

       

      24.  (a)
        All payments made by any Guarantor hereunder will be made without setoff,
        counterclaim or other defense, will be made in the currency or currencies
        in
        which the respective Guaranteed Obligations are then due and payable and
        will be
        made on the same basis as payments are made by the Borrower under Sections
        4.04
        and 4.05 of the Credit Agreement.

       

      (b)
        The
        Guarantors’ obligations hereunder to make payments in the respective currency or
        currencies in which the respective Guaranteed Obligations are required to
        be
        paid (such currency being herein called the “Obligation Currency”) shall not be
        discharged or satisfied by any tender or recovery pursuant to any judgment
        expressed in or converted into any currency other than the Obligation Currency,
        except to the extent that such tender or recovery results in the effective
        receipt by the Administrative Agent, the Collateral Agent or the respective
        other Secured Creditor of the full amount of the Obligation Currency expressed
        to be payable to the Administrative Agent, the Collateral Agent or such other
        Secured Creditor under this Guaranty or the other Credit Documents or any
        Interest Rate Protection Agreement or Other Hedging Agreement, as
        applicable.  If for the purpose of obtaining or enforcing judgment
        against any Guarantor in any court or in any jurisdiction, it becomes necessary
        to convert into or from any currency other than the Obligation Currency (such
        other currency being hereinafter referred to as the “Judgment Currency”) an
        amount due in the Obligation Currency, the conversion shall be made, at the
        rate
        of exchange (quoted by the Administrative Agent, determined, in each case,
        as of
        the date immediately preceding the day on which the judgment is given (such
        Business Day being hereinafter referred to as the “Judgment Currency Conversion
        Date”).

       

      (c)  If
        there is a change in the rate of exchange prevailing between the Judgment
        Currency Conversion Date and the date of actual payment of the amount due,
        the
        Guarantors jointly and severally covenant and agree to pay, or cause to be
        paid,
        such additional amounts, if any (but in any event not a lesser amount), as
        may
        be necessary to ensure that the amount paid in the Judgment Currency, when
        converted at the rate of exchange prevailing on the date of payment, will
        produce the amount of the Obligation Currency which could have been purchased
        with the amount of Judgment Currency stipulated in the judgment or judicial
        award at the rate or exchange prevailing on the Judgment Currency Conversion
        Date.

       

      (d)  For
        purposes of determining the Relevant Currency Equivalent or any other rate
        of
        exchange for this Section 24, such amounts shall include any premium and
        costs
        payable in connection with the purchase of the Obligation Currency.

       

      25.  It
        is understood and agreed that any Subsidiary of the Borrower that is required
        to
        execute a counterpart of this Guaranty after the date hereof pursuant to
        the
        Credit Agreement shall automatically become a Guarantor hereunder by executing
        a
        counterpart hereof and/or a Subsidiary assumption agreement, in each case
        in
        form and substance satisfactory to the Administrative Agent, and delivering
        the
        same to the Administrative Agent.

       

       

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      page
        14


       

      IN
        WITNESS WHEREOF, each Guarantor has caused this Guaranty to be executed and
        delivered as of the date first above written.

       

             
        GENCO AUGUSTUS LIMITED

      
        	
                 

              	
                as
                  Guarantor

              


      

      


      


      
        	
              	
                By:
                  /s/ Robert Gerard Buchanan

              	 


      

      
        	
                 

              	
                Name: 
                  Robert Gerard Buchanan

              


      

      
        	
                 

              	
                Title:
                  President

              


      

       

      
        	
                 

              	
                GENCO
                  CLAUDIUS LIMITED

              


      

      
        	
                 

              	
                as
                  Guarantor

              


      

       

      
        
          	
                	
                  By:
                    /s/ Robert Gerard Buchanan

                	 


        

        
          	
                   

                	
                  Name: 
                    Robert Gerard Buchanan

                


        

        
          	
                   

                	
                  Title:
                    President

                


        

         

      

      
        	
                 

              	
                GENCO
                  COMMODUS LIMITED

              


      

      
        	
                 

              	
                as
                  Guarantor

              


      

       

      
        
          	
                	
                  By:
                    /s/ Robert Gerard Buchanan

                	 


        

        
          	
                   

                	
                  Name: 
                    Robert Gerard Buchanan

                


        

        
          	
                   

                	
                  Title:
                    President

                


        

         

      

      
        	
                 

              	
                GENCO
                  CONSTANTINE LIMITED

              


      

      
        	
                 

              	
                as
                  Guarantor

              


      

       

      
        
          	
                	
                  By:
                    /s/ Robert Gerard Buchanan

                	 


        

        
          	
                   

                	
                  Name: 
                    Robert Gerard Buchanan

                


        

        
          	
                   

                	
                  Title:
                    President

                


        

         

      

      
        	
                 

              	
                GENCO
                  HADRIAN LIMITED

              


      

      
        	
                 

              	
                as
                  Guarantor

              


      

       

      
        
          	
                	
                  By:
                    /s/ Robert Gerard Buchanan

                	 


        

        
          	
                   

                	
                  Name: 
                    Robert Gerard Buchanan

                


        

        
          	
                   

                	
                  Title:
                    President

                


        

         

        
 

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      page
        15

       

      
 

      
        	
                 

              	
                GENCO
                  LONDON LIMITED

              


      

      
        	
                 

              	
                as
                  Guarantor

              


      

       

      
        
          	
                	
                  By:
                    /s/ Robert Gerard Buchanan

                	 


        

        
          	
                   

                	
                  Name: 
                    Robert Gerard Buchanan

                


        

        
          	
                   

                	
                  Title:
                    President

                


        

         

      

      
        	
                 

              	
                GENCO
                  MAXIMUS LIMITED

              


      

      
        	
                 

              	
                as
                  Guarantor

              


      

       

      
        
          	
                	
                  By:
                    /s/ Robert Gerard Buchanan

                	 


        

        
          	
                   

                	
                  Name: 
                    Robert Gerard Buchanan

                


        

        
          	
                   

                	
                  Title:
                    President

                


        

         

      

      
        	
                 

              	
                GENCO
                  TIBERIUS LIMITED

              


      

      
        	
                 

              	
                as
                  Guarantor

              


      

       

      
        
          	
                	
                  By:
                    /s/ Robert Gerard Buchanan

                	 


        

        
          	
                   

                	
                  Name: 
                    Robert Gerard Buchanan

                


        

        
          	
                   

                	
                  Title:
                    President

                


        

      

      


      
        	
                 

              	
                GENCO
                  TITUS LIMITED

              


      

      
        	
                 

              	
                as
                  Guarantor

              


      

       

      
        
          	
                	
                  By:
                    /s/ Robert Gerard Buchanan

                	 


        

        
          	
                   

                	
                  Name: 
                    Robert Gerard Buchanan

                


        

        
          	
                   

                	
                  Title:
                    President

                


        

         

        
 

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

       

       

       

      
        	
                 

              	
                DNB
                  NOR BANK ASA,

              


      

      
        	
              	
                 

              	
                NEW
                  YORK BRANCH

              


      

      


      
        	
                By:
                  /s/ Nikolai A. Nachamkin

              	 


      

      
        	
                 

              	
                Name:
                  Nikolai A. Nachamkin

              


      

      
        	
                 

              	
                Title:
                  Senior Vice President

              


      

       

       

      
        	
                By:
                  /s/ Cathleen Buckley

              	 	 


      

      
        	
                 

              	
                Name:
                  Cathleen Buckley

              


      

      
        	
                 

              	
                Title:
                  Vice President