Exhibit
10.12


 


REGISTRATION
RIGHTS AGREEMENT


 


THIS REGISTRATION
RIGHTS AGREEMENT (this “Agreement”) is entered into as of the
           day of
             ,
2004, by and among: International Shipping Enterprises, Inc., a Delaware
corporation (the “Company”); and the undersigned parties listed under Investors
on the signature page hereto (each, an “Investor” and collectively, the
“Investors”).


 


WHEREAS, the
Investors currently hold all of the issued and outstanding securities of the
Company;


 


WHEREAS, the Investors
and the Company desire to enter into this Agreement to provide the Investors
with certain rights relating to the registration of shares of Common Stock held
by them;


 


NOW, THEREFORE, in
consideration of the mutual covenants and agreements set forth herein, and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto agree as follows:


 


1.             DEFINITIONS.  The following
capitalized terms used herein have the following meanings:


 


“Agreement” means this Agreement, as amended, restated,
supplemented, or otherwise modified from time to time.


 


“Commission” means the Securities and Exchange Commission, or
any other federal agency then administering the Securities Act or the Exchange
Act.


 


“Common Stock” means the common stock, par value $0.0001 per
share, of the Company.


 


“Company” is defined in the preamble to this Agreement.


 


“Demand Registration” is defined in Section 2.1.1.


 


“Demanding Holder” is defined in Section 2.1.1.


 


“Exchange Act” means the Securities Exchange Act of 1934, as
amended, and the rules and regulations of the Commission promulgated
thereunder, all as the same shall be in effect at the time.


 


“Form S-3” is defined in Section 2.3.


 


“Indemnified Party” is defined in Section 4.3.


 


“Indemnifying Party” is defined in Section 4.3.


 


“Investor” is defined in the preamble to this Agreement.


 


“Investor Indemnified Party” is defined in Section 4.1.


 

















 


“Maximum Number of Shares” is defined in Section 2.1.4.


 


“Notices” is defined in Section 6.3.


 


“Piggy-Back Registration” is defined in Section 2.2.1.


 


“Register,” “registered” and “registration” mean a
registration effected by preparing and filing a registration statement or
similar document in compliance with the requirements of the Securities Act, and
the applicable rules and regulations promulgated thereunder, and such
registration statement becoming effective.


 


“Registrable Securities” mean all of the shares of Common Stock
owned or held by Investors.  Registrable
Securities include any warrants, shares of capital stock or other securities of
the Company issued as a dividend or other distribution with respect to or in
exchange for or in replacement of such shares of Common Stock.  As to any particular Registrable Securities,
such securities shall cease to be Registrable Securities when:  (a) a Registration Statement with
respect to the sale of such securities shall have become effective under the
Securities Act and such securities shall have been sold, transferred, disposed
of or exchanged in accordance with such Registration Statement; (b) such
securities shall have been otherwise transferred, new certificates for them not
bearing a legend restricting further transfer shall have been delivered by the
Company and subsequent public distribution of them shall not require
registration under the Securities Act; (c) such securities shall have
ceased to be outstanding, or (d) the Securities and Exchange Commission makes a
definitive determination to the Company that the Registrable Securities are
salable under Rule 144(k).


 


“Registration Statement” means a registration statement filed by
the Company with the Commission in compliance with the Securities Act and the
rules and regulations promulgated thereunder for a public offering and sale of
Common Stock (other than a registration statement on Form S-4 or
Form S-8, or their successors, or any registration statement covering only
securities proposed to be issued in exchange for securities or assets of
another entity).


 


“Release Date” means the date on which shares of Common Stock
are disbursed from escrow pursuant to Section 3 of that certain Stock
Escrow Agreement dated as of
                ,
2004 by and among the parties hereto and Continental Stock Transfer & Trust
Company.


 


“Securities Act” means the Securities Act of 1933, as amended,
and the rules and regulations of the Commission promulgated thereunder, all as
the same shall be in effect at the time.


 


“Underwriter” means a securities dealer who purchases any
Registrable Securities as principal in an underwritten offering and not as part
of such dealer’s market-making activities.


 


2.             REGISTRATION RIGHTS.


 


2.1           Demand Registration.


 


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2.1.1.       Request for Registration.  At any time and from time to time on or
after the Release Date, the holders of a majority-in-interest of the
Registrable Securities held by the Investors or the transferees of the
Investors, may make a written demand for registration under the Securities Act
of all or part of their Registrable Securities (a “Demand Registration”).  Any demand for a Demand Registration shall
specify the number of shares of Registrable Securities proposed to be sold and
the intended method(s) of distribution thereof.  The Company will notify all holders of Registrable Securities of
the demand, and each holder of Registrable Securities who wishes to include all
or a portion of such holder’s Registrable Securities in the Demand Registration
(each such holder including shares of Registrable Securities in such
registration, a “Demanding Holder”) shall so notify the Company within
fifteen (15) days after the receipt by the holder of the notice from the
Company.  Upon any such request, the
Demanding Holders shall be entitled to have their Registrable Securities
included in the Demand Registration, subject to Section 2.1.4 and the
provisos set forth in Section 3.1.1. 
The Company shall not be obligated to effect more than an aggregate of
two (2) Demand Registrations under this Section 2.1.1 in respect of Registrable
Securities.


 


2.1.2.       Effective Registration.  A registration will not count as a Demand
Registration until the Registration Statement filed with the Commission with
respect to such Demand Registration has been declared effective and the Company
has complied with all of its obligations under this Agreement with respect
thereto; provided, however, that if, after such Registration
Statement has been declared effective, the offering of Registrable Securities
pursuant to a Demand Registration is interfered with by any stop order or
injunction of the Commission or any other governmental agency or court, the
Registration Statement with respect to such Demand Registration will be deemed
not to have been declared effective, unless and until, (i) such stop order or
injunction is removed, rescinded or otherwise terminated, and (ii) a
majority-in-interest of the Demanding Holders thereafter elect to continue the
offering; provided, further, that the Company shall not be
obligated to file a second Registration Statement until a Registration
Statement that has been filed is counted as a Demand Registration or is
terminated.


 


2.1.3.       Underwritten Offering.  If a majority-in-interest of the Demanding
Holders so elect and such holders so advise the Company as part of their
written demand for a Demand Registration, the offering of such Registrable
Securities pursuant to such Demand Registration shall be in the form of an
underwritten offering. In such event, the right of any holder to include its
Registrable Securities in such registration shall be conditioned upon such
holder’s participation in such underwriting and the inclusion of such holder’s
Registrable Securities in the underwriting to the extent provided herein.  All Demanding Holders proposing to
distribute their securities through such underwriting shall enter into an
underwriting agreement in customary form with the Underwriter or Underwriters
selected for such underwriting by a majority-in-interest of the holders
initiating the Demand Registration.


 


2.1.4.       Reduction of Offering.  If the managing Underwriter or Underwriters
for a Demand Registration that is to be an underwritten offering advises the
Company and the Demanding Holders in writing that the dollar amount or number
of shares of Registrable Securities which the Demanding Holders desire to sell,
taken together with all other shares of Common Stock or other securities which
the Company desires to sell and the shares of Common Stock, if any, as to which
registration has been requested pursuant to written contractual piggy-back
registration rights held by other shareholders of the Company who desire


 


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to sell, exceeds
the maximum dollar amount or maximum number of shares that can be sold in such
offering without adversely affecting the proposed offering price, the timing,
the distribution method, or the probability of success of such offering (such
maximum dollar amount or maximum number of shares, as applicable, the “Maximum
Number of Shares”), then the Company shall include in such
registration:  (i) first, the
Registrable Securities as to which Demand Registration has been requested by
the Demanding Holders (pro  rata in accordance with the number of
shares of Registrable Securities which such Demanding Holder has requested be
included in such registration, regardless of the number of shares of
Registrable Securities held by each Demanding Holder) that can be sold without
exceeding the Maximum Number of Shares; (ii) second, to the extent that the
Maximum Number of Shares has not been reached under the foregoing clause (i),
the shares of Common Stock or other securities that the Company desires to sell
that can be sold without exceeding the Maximum Number of Shares; (iii) third,
to the extent that the Maximum Number of Shares has not been reached under the
foregoing clauses (i) and (ii), the shares of Common Stock for the account of
other persons that the Company is obligated to register pursuant to written
contractual arrangements with such persons and that can be sold without
exceeding the Maximum Number of Shares; and (v) fourth, to the extent that the
Maximum Number of Shares have not been reached under the foregoing clauses (i),
(ii), and (iii), the shares of Common Stock that other shareholders desire to
sell that can be sold without exceeding the Maximum Number of Shares.


 


2.1.5.       Withdrawal. If a
majority-in-interest of the Demanding Holders disapprove of the terms of any
underwriting or are not entitled to include all of their Registrable Securities
in any offering, such majority-in-interest of the Demanding Holders may elect
to withdraw from such offering by giving written notice to the Company and the
Underwriter or Underwriters of their request to withdraw prior to the
effectiveness of the Registration Statement filed with the Commission with
respect to such Demand Registration.  If
the majority-in-interest of the Demanding Holders withdraws from a proposed
offering relating to a Demand Registration, then such registration shall not
count as a Demand Registration provided for in Section 2.1.1.


 


2.2           Piggy-Back
Registration.


 


2.2.1.       Piggy-Back Rights.  If at any time on or after the Release Date
the Company proposes to file a Registration Statement under the Securities Act
with respect to an offering of equity securities, or securities or other
obligations exercisable or exchangeable for, or convertible into, equity
securities, by the Company for its own account or for shareholders of the
Company for their account (or by the Company and by shareholders of the Company
including, without limitation, pursuant to Section 2.1), other than a
Registration Statement (i) filed in connection with any employee stock option
or other benefit plan, (ii) for an exchange offer or offering of securities
solely to the Company’s existing shareholders, (iii) for an offering of debt
that is convertible into equity securities of the Company or (iv) for a
dividend reinvestment plan, then the Company shall (x) give written notice of
such proposed filing to the holders of Registrable Securities as soon as
practicable but in no event less than ten (10) days before the anticipated
filing date, which notice shall describe the amount and type of securities to
be included in such offering, the intended method(s) of distribution, and the
name of the proposed managing Underwriter or Underwriters, if any, of the
offering, and (y) offer to the holders of Registrable Securities in such notice
the opportunity to register the sale of such number of shares


 


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of Registrable
Securities as such holders may request in writing within fifteen (15) days
following receipt of such notice (a “Piggy-Back Registration”).  The Company shall cause such Registrable
Securities to be included in such registration and shall use its best efforts
to cause the managing Underwriter or Underwriters of a proposed underwritten
offering to permit the Registrable Securities requested to be included in a
Piggy-Back Registration to be included on the same terms and conditions as any
similar securities of the Company and to permit the sale or other disposition
of such Registrable Securities in accordance with the intended method(s) of
distribution thereof.  All holders of
Registrable Securities proposing to distribute their securities through a
Piggy-Back Registration that involves an Underwriter or Underwriters shall
enter into an underwriting agreement in customary form with the Underwriter or
Underwriters selected for such Piggy-Back Registration.


 


2.2.2.       Reduction of Offering.  If the managing Underwriter or Underwriters
for a Piggy-Back Registration that is to be an underwritten offering advises
the Company and the holders of Registrable Securities in writing that the
dollar amount or number of shares of Common Stock which the Company desires to
sell, taken together with shares of Common Stock, if any, as to which
registration has been demanded pursuant to written contractual arrangements
with persons other than the holders of Registrable Securities hereunder, the
Registrable Securities as to which registration has been requested under this
Section 2.2, and the shares of Common Stock, if any, as to which
registration has been requested pursuant to the written contractual piggy-back
registration rights of other shareholders of the Company, exceeds the Maximum
Number of Shares, then the Company shall include in any such registration:


 


(i)            If the registration is
undertaken for the Company’s account: (A) first, the shares of Common Stock or
other securities that the Company desires to sell that can be sold without
exceeding the Maximum Number of Shares; (B) second, to the extent that the
Maximum Number of Shares has not been reached under the foregoing clause (A),
the shares of Common Stock, if any, including the Registrable Securities, as to
which registration has been requested pursuant to written contractual
piggy-back registration rights of security holders (pro rata in accordance with
the number of shares of Common Stock which each such person has actually
requested to be included in such registration, regardless of the number of
shares of Common Stock with respect to which such persons have the right to
request such inclusion) that can be sold without exceeding the Maximum Number
of Shares; and


 


(ii)           If the registration is
a “demand” registration undertaken at the demand of persons other than the
holders of Registrable Securities pursuant to written contractual arrangements
with such persons, (A) first, the shares of Common Stock for the account of the
demanding persons that can be sold without exceeding the Maximum Number of
Shares; (B) second, to the extent that the Maximum Number of Shares has not
been reached under the foregoing clause (A), the shares of Common Stock or
other securities that the Company desires to sell that can be sold without
exceeding the Maximum Number of Shares; and (C) third, to the extent that the
Maximum Number of Shares has not been reached under the foregoing clauses (A)
and (B), the Registrable Securities as to which registration has been requested
under this Section 2.2 (pro  rata in accordance with the
number of shares of Registrable Securities held by each such holder); and
(D) fourth, to the extent that the Maximum Number of Shares has not been
reached under the foregoing clauses (A), (B) and (C), the shares of Common
Stock, if any, as to which registration has been requested pursuant to written
contractual piggy-


 


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back registration
rights which other shareholders desire to sell that can be sold without exceeding
the Maximum Number of Shares.


 


2.2.3.       Withdrawal.  Any holder of Registrable Securities may
elect to withdraw such holder’s request for inclusion of Registrable Securities
in any Piggy-Back Registration by giving written notice to the Company of such
request to withdraw prior to the effectiveness of the Registration
Statement.  The Company may also elect
to withdraw a registration statement at any time prior to the effectiveness of
the Registration Statement. 
Notwithstanding any such withdrawal, the Company shall pay all expenses
incurred by the holders of Registrable Securities in connection with such
Piggy-Back Registration as provided in Section 3.3.


 


2.3           Registrations on
Form S-3.  The holders of
Registrable Securities may at any time and from time to time, request in
writing that the Company register the resale of any or all of such Registrable
Securities on Form S-3 or any similar short-form registration which may be
available at such time (“Form S-3”); provided, however,
that the Company shall not be obligated to effect such request through an
underwritten offering.  Upon receipt of
such written request, the Company will promptly give written notice of the
proposed registration to all other holders of Registrable Securities, and, as
soon as practicable thereafter, effect the registration of all or such portion
of such holder’s or holders’ Registrable Securities as are specified in such
request, together with all or such portion of the Registrable Securities of any
other holder or holders joining in such request as are specified in a written
request given within fifteen (15) days after receipt of such written notice
from the Company; provided, however, that the Company shall not
be obligated to effect any such registration pursuant to this Section 2.3:
(i) if Form S-3 is not available for such offering; or (ii) if the holders of
the Registrable Securities, together with the holders of any other securities
of the Company entitled to inclusion in such registration, propose to sell
Registrable Securities and such other securities (if any) at any aggregate
price to the public of less than $500,000. Registrations effected pursuant to
this Section 2.3 shall not be counted as Demand Registrations effected
pursuant to Section 2.1.


 


3.             REGISTRATION
PROCEDURES.


 


3.1           Filings; Information.  Whenever the Company is required to effect
the registration of any Registrable Securities pursuant to Section 2, the
Company shall use its best efforts to effect the registration and sale of such
Registrable Securities in accordance with the intended method(s) of
distribution thereof as expeditiously as practicable, and in connection with
any such request:


 


3.1.1.       Filing Registration
Statement.  The Company shall, as
expeditiously as possible and in any event within sixty (60) days after receipt
of a request for a Demand Registration pursuant to Section 2.1, prepare
and file with the Commission a Registration Statement on any form for which the
Company then qualifies or which counsel for the Company shall deem appropriate and
which form shall be available for the sale of all Registrable Securities to be
registered thereunder in accordance with the intended method(s) of distribution
thereof, and shall use its best efforts to cause such Registration Statement to
become and remain effective for the period required by Section 3.1.3; provided,
however, that the Company shall have the right to defer any Demand
Registration for up to thirty (30) days, and


 


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any Piggy-Back
Registration for such period as may be applicable to deferment of any demand
registration to which such Piggy-Back Registration relates, in each case if the
Company shall furnish to the holders a certificate signed by the Chief
Executive Officer of the Company stating that, in the good faith judgment of
the Board of Directors of the Company, it would be materially detrimental to
the Company and its shareholders for such Registration Statement to be effected
at such time; provided  further, however, that the Company
shall not have the right to exercise the right set forth in the immediately
preceding proviso more than once in any 365-day period in respect of a Demand
Registration hereunder.


 


3.1.2.       Copies.  The Company shall, prior to filing a
Registration Statement or prospectus, or any amendment or supplement thereto,
furnish without charge to the holders of Registrable Securities included in
such registration, and such holders’ legal counsel, copies of such Registration
Statement as proposed to be filed, each amendment and supplement to such
Registration Statement (in each case including all exhibits thereto and
documents incorporated by reference therein), the prospectus included in such
Registration Statement (including each preliminary prospectus), and such other
documents as the holders of Registrable Securities included in such
registration or legal counsel for any such holders may request in order to
facilitate the disposition of the Registrable Securities owned by such holders.


 


3.1.3.       Amendments and
Supplements.  The Company shall
prepare and file with the Commission such amendments, including post-effective
amendments, and supplements to such Registration Statement and the prospectus
used in connection therewith as may be necessary to keep such Registration
Statement effective and in compliance with the provisions of the Securities Act
until all Registrable Securities and other securities covered by such
Registration Statement have been disposed of in accordance with the intended
method(s) of distribution set forth in such Registration Statement (which
period shall not exceed the sum of one hundred eighty (180) days plus any
period during which any such disposition is interfered with by any stop order
or injunction of the Commission or any governmental agency or court) or such
securities have been withdrawn.


 


3.1.4.       Notification.  After the filing of a Registration
Statement, the Company shall promptly, and in no event more than two (2)
business days after such filing, notify the holders of Registrable Securities
included in such Registration Statement of such filing, and shall further
notify such holders promptly and confirm such advice in writing in all events
within two (2) business days of the occurrence of any of the following:  (i) when such Registration Statement becomes
effective; (ii) when any post-effective amendment to such Registration
Statement becomes effective; (iii) the issuance or threatened issuance by
the Commission of any stop order (and the Company shall take all actions
required to prevent the entry of such stop order or to remove it if entered);
and (iv) any request by the Commission for any amendment or supplement to
such Registration Statement or any prospectus relating thereto or for
additional information or of the occurrence of an event requiring the
preparation of a supplement or amendment to such prospectus so that, as
thereafter delivered to the purchasers of the securities covered by such
Registration Statement, such prospectus will not contain an untrue statement of
a material fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein not misleading, and
promptly make available to the holders of Registrable Securities included in
such Registration Statement any such supplement or amendment; except that
before filing with the Commission a Registration Statement or 


 


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prospectus or any
amendment or supplement thereto, including documents incorporated by reference,
the Company shall furnish to the holders of Registrable Securities included in
such Registration Statement and to the legal counsel for any such holders,
copies of all such documents proposed to be filed sufficiently in advance of
filing to provide such holders and legal counsel with a reasonable opportunity
to review such documents and comment thereon, and the Company shall not file
any Registration Statement or prospectus or amendment or supplement thereto,
including documents incorporated by reference, to which such holders or their
legal counsel shall object.


 


3.1.5.       State Securities Laws
Compliance.  The Company shall use
its best efforts to (i) register or qualify the Registrable Securities
covered by the Registration Statement under such securities or “blue sky” laws
of such jurisdictions in the United States as the holders of Registrable
Securities included in such Registration Statement (in light of their intended
plan of distribution) may request and (ii) take such action necessary to
cause such Registrable Securities covered by the Registration Statement to be
registered with or approved by such other Governmental Authorities as may be
necessary by virtue of the business and operations of the Company and do any
and all other acts and things that may be necessary or advisable to enable the
holders of Registrable Securities included in such Registration Statement to
consummate the disposition of such Registrable Securities in such
jurisdictions; provided, however, that the Company shall not be
required to qualify generally to do business in any jurisdiction where it would
not otherwise be required to qualify but for this paragraph (e) or subject
itself to taxation in any such jurisdiction.


 


3.1.6.       Agreements for
Disposition.  The Company shall
enter into customary agreements (including, if applicable, an underwriting
agreement in customary form) and take such other actions as are reasonably
required in order to expedite or facilitate the disposition of such Registrable
Securities.  The representations,
warranties and covenants of the Company in any underwriting agreement which are
made to or for the benefit of any Underwriters, to the extent applicable, shall
also be made to and for the benefit of the holders of Registrable Securities
included in such registration statement. 
No holder of Registrable Securities included in such registration
statement shall be required to make any representations or warranties in the
underwriting agreement except, if applicable, with respect to such holder’s
organization, good standing, authority, title to Registrable Securities, lack
of conflict of such sale with such holder’s material agreements and
organizational documents, and with respect to written information relating to
such holder that such holder has furnished in writing expressly for inclusion
in such Registration Statement.


 


3.1.7.       Cooperation.  The principal executive officer of the
Company, the principal financial officer of the Company, the principal
accounting officer of the Company and all other officers and members of the
management of the Company shall cooperate fully in any offering of Registrable
Securities hereunder, which cooperation shall include, without limitation, the
preparation of the Registration Statement with respect to such offering and all
other offering materials and related documents, and participation in meetings
with Underwriters, attorneys, accountants and potential investors.


 


3.1.8.       Records.  The Company shall make available for
inspection by the holders of Registrable Securities included in such
Registration Statement, any Underwriter


 


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participating in
any disposition pursuant to such registration statement and any attorney,
accountant or other professional retained by any holder of Registrable
Securities included in such Registration Statement or any Underwriter, all
financial and other records, pertinent corporate documents and properties of
the Company, as shall be necessary to enable them to exercise their due
diligence responsibility, and cause the Company’s officers, directors and
employees to supply all information requested by any of them in connection with
such Registration Statement.


 


3.1.9.       Opinions and Comfort
Letters.  The Company shall furnish
to each holder of Registrable Securities included in any Registration Statement
a signed counterpart, addressed to such holder, of (i) any opinion of
counsel to the Company delivered to any Underwriter and (ii) any comfort
letter from the Company’s independent public accountants delivered to any
Underwriter.  In the event no legal
opinion is delivered to any Underwriter, the Company shall furnish to each
holder of Registrable Securities included in such Registration Statement, at
any time that such holder elects to use a prospectus, an opinion of counsel to
the Company to the effect that the Registration Statement containing such
prospectus has been declared effective and that no stop order is in effect.


 


3.1.10.     Earnings Statement.  The Company shall comply with all applicable
rules and regulations of the Commission and the Securities Act, and make
available to its shareholders, as soon as practicable, an earnings statement
covering a period of twelve (12) months, beginning within three (3) months
after the effective date of the registration statement, which earnings
statement shall satisfy the provisions of Section 11(a) of the
Securities Act and Rule 158 thereunder.


 


3.1.11.     Listing.  The Company shall use its best efforts to
cause all Registrable Securities included in any registration to be listed on
such exchanges or otherwise designated for trading in the same manner as
similar securities issued by the Company are then listed or designated or, if
no such similar securities are then listed or designated, in a manner
satisfactory to the holders of a majority of the Registrable Securities
included in such registration.


 


3.2           Obligation to
Suspend Distribution.  Upon receipt
of any notice from the Company of the happening of any event of the kind
described in Section 3.1.4(iv), or, in the case of a resale registration
on Form S-3 pursuant to Section 2.3 hereof, upon any suspension by the
Company, pursuant to a written insider trading compliance program adopted by
the Company’s Board of Directors, of the ability of all “insiders” covered by
such program to transact in the Company’s securities because of the existence
of material non-public information, each holder of Registrable Securities
included in any registration shall immediately discontinue disposition of such
Registrable Securities pursuant to the Registration Statement covering such
Registrable Securities until such holder receives the supplemented or amended
prospectus contemplated by Section 3.1.4(iv) or the restriction on the
ability of “insiders” to transact in the Company’s securities is removed, as applicable,
and, if so directed by the Company, each such holder will deliver to the
Company all copies, other than permanent file copies then in such holder’s
possession, of the most recent prospectus covering such Registrable Securities
at the time of receipt of such notice.


 


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3.3           Registration
Expenses.  The Company shall bear
all costs and expenses incurred in connection with any Demand Registration
pursuant to Section 2.1, any Piggy-Back Registration pursuant to
Section 2.2, and any registration on Form S-3 effected pursuant to
Section 2.3, and all expenses incurred in performing or complying with its
other obligations under this Agreement, whether or not the Registration
Statement becomes effective, including, without limitation: (i) all
registration and filing fees; (ii) fees and expenses of compliance with
securities or “blue sky” laws (including fees and disbursements of counsel in
connection with blue sky qualifications of the Registrable Securities);
(iii) printing expenses; (iv) the Company’s internal expenses
(including, without limitation, all salaries and expenses of its officers and
employees); (v) the fees and expenses incurred in connection with the
listing of the Registrable Securities as required by Section 3.1.11;
(vi) National Association of Securities Dealers, Inc. fees;
(vii) fees and disbursements of counsel for the Company and fees and
expenses for independent certified public accountants retained by the Company
(including the expenses or costs associated with the delivery of any opinions
or comfort letters requested pursuant to Section 3.1.9); (viii) the
fees and expenses of any special experts retained by the Company in connection
with such registration and (ix)  the fees and expenses of one legal
counsel selected by the holders of a majority-in-interest of the Registrable
Securities included in such registration. 
The Company shall have no obligation to pay any underwriting discounts
or selling commissions attributable to the Registrable Securities being sold by
the holders thereof, which underwriting discounts or selling commissions shall
be borne by such holders.  Additionally,
in an underwritten offering, all selling shareholders and the Company shall
bear the expenses of the underwriter pro rata in proportion to the respective
amount of shares each is selling in such offering.


 


3.4           Information.  The holders of Registrable Securities shall
provide such information as may reasonably be requested by the Company, or the
managing Underwriter, if any, in connection with the preparation of any
Registration Statement, including amendments and supplements thereto, in order
to effect the registration of any Registrable Securities under the Securities
Act pursuant to Section 2 and in connection with the Company’s obligation
to comply with federal and applicable state securities laws.


 


4.             INDEMNIFICATION AND
CONTRIBUTION.


 


4.1           Indemnification by
the Company.  The Company agrees to
indemnify and hold harmless each Investor and each other holder of Registrable
Securities, and each of their respective officers, employees, affiliates,
directors, partners, members, attorneys and agents, and each person, if any,
who controls an Investor and each other holder of Registrable Securities
(within the meaning of Section 15 of the Securities Act or Section 20
of the Exchange Act) (each, an “Investor Indemnified Party”), from and
against any expenses, losses, judgments, claims, damages or liabilities,
whether joint or several, arising out of or based upon any untrue statement (or
allegedly untrue statement) of a material fact contained in any Registration
Statement under which the sale of such Registrable Securities was registered
under the Securities Act, any preliminary prospectus, final prospectus or
summary prospectus contained in the Registration Statement, or any amendment or
supplement to such Registration Statement, or arising out of or based upon any
omission (or alleged omission) to state a material fact required to be stated
therein or necessary to make the statements therein not misleading, or any
violation by the Company of the Securities Act or any rule or regulation
promulgated thereunder


 


10

















 


applicable to the
Company and relating to action or inaction required of the Company in
connection with any such registration; and the Company shall promptly reimburse
the Investor Indemnified Party for any legal and any other expenses reasonably
incurred by such Investor Indemnified Party in connection with investigating and
defending any such expense, loss, judgment, claim, damage, liability or action;
provided, however, that the Company will not be liable in any
such case to the extent that any such expense, loss, claim, damage or liability
arises out of or is based upon any untrue statement or allegedly untrue
statement or omission or alleged omission made in such Registration Statement,
preliminary prospectus, final prospectus, or summary prospectus, or any such
amendment or supplement, in reliance upon and in conformity with information
furnished to the Company, in writing, by such selling holder expressly for use
therein.  The Company also shall
indemnify any Underwriter of the Registrable Securities, their officers,
affiliates, directors, partners, members and agents and each person who
controls such Underwriter on substantially the same basis as that of the
indemnification provided above in this Section 4.1.


 


4.2           Indemnification by
Holders of Registrable Securities. 
Each selling holder of Registrable Securities will, in the event that
any registration is being effected under the Securities Act pursuant to this
Agreement of any Registrable Securities held by such selling holder, indemnify
and hold harmless the Company, each of its directors and officers and each underwriter
(if any), and each other person, if any, who controls such selling holder or
such underwriter within the meaning of the Securities Act, against any losses,
claims, judgments, damages or liabilities, whether joint or several, insofar as
such losses, claims, judgments, damages or liabilities (or actions in respect
thereof) arise out of or are based upon any untrue statement or allegedly
untrue statement of a material fact contained in any Registration Statement
under which the sale of such Registrable Securities was registered under the
Securities Act, any preliminary prospectus, final prospectus or summary
prospectus contained in the Registration Statement, or any amendment or
supplement to the Registration Statement, or arise out of or are based upon any
omission or the alleged omission to state a material fact required to be stated
therein or necessary to make the statement therein not misleading, if the
statement or omission was made in reliance upon and in conformity with
information furnished in writing to the Company by such selling holder
expressly for use therein, and shall reimburse the Company, its directors and
officers, and each such controlling person for any legal or other expenses
reasonably incurred by any of them in connection with investigation or
defending any such loss, claim, damage, liability or action.  Each selling holder’s indemnification
obligations hereunder shall be several and not joint and shall be limited to
the amount of any net proceeds actually received by such selling holder.


 


4.3           Conduct of
Indemnification Proceedings. 
Promptly after receipt by any person of any notice of any loss, claim,
damage or liability or any action in respect of which indemnity may be sought
pursuant to Section 4.1 or 4.2, such person (the “Indemnified Party”)
shall, if a claim in respect thereof is to be made against any other person for
indemnification hereunder, notify such other person (the “Indemnifying Party”)
in writing of the loss, claim, judgment, damage, liability or action; provided,
however, that the failure by the Indemnified Party to notify the
Indemnifying Party shall not relieve the Indemnifying Party from any liability
which the Indemnifying Party may have to such Indemnified Party hereunder,
except and solely to the extent the Indemnifying Party is actually prejudiced
by such failure.  If the Indemnified
Party is seeking indemnification with respect to any claim or action brought
against the


 


11

















 


Indemnified Party,
then the Indemnifying Party shall be entitled to participate in such claim or
action, and, to the extent that it wishes, jointly with all other Indemnifying
Parties, to assume control of the defense thereof with counsel satisfactory to
the Indemnified Party.  After notice from
the Indemnifying Party to the Indemnified Party of its election to assume
control of the defense of such claim or action, the Indemnifying Party shall
not be liable to the Indemnified Party for any legal or other expenses
subsequently incurred by the Indemnified Party in connection with the defense
thereof other than reasonable costs of investigation; provided, however,
that in any action in which both the Indemnified Party and the Indemnifying
Party are named as defendants, the Indemnified Party shall have the right to
employ separate counsel (but no more than one such separate counsel) to
represent the Indemnified Party and its controlling persons who may be subject
to liability arising out of any claim in respect of which indemnity may be
sought by the Indemnified Party against the Indemnifying Party, with the fees
and expenses of such counsel to be paid by such Indemnifying Party if, based
upon the written opinion of counsel of such Indemnified Party, representation
of both parties by the same counsel would be inappropriate due to actual or
potential differing interests between them. 
No Indemnifying Party shall, without the prior written consent of the
Indemnified Party, consent to entry of judgment or effect any settlement of any
claim or pending or threatened proceeding in respect of which the Indemnified
Party is or could have been a party and indemnity could have been sought
hereunder by such Indemnified Party, unless such judgment or settlement
includes an unconditional release of such Indemnified Party from all liability
arising out of such claim or proceeding.


 


4.4           Contribution.


 


4.4.1.       If the indemnification
provided for in the foregoing Sections 4.1, 4.2 and 4.3 is unavailable to
any Indemnified Party in respect of any loss, claim, damage, liability or
action referred to herein, then each such Indemnifying Party, in lieu of
indemnifying such Indemnified Party, shall contribute to the amount paid or
payable by such Indemnified Party as a result of such loss, claim, damage,
liability or action in such proportion as is appropriate to reflect the
relative fault of the Indemnified Parties and the Indemnifying Parties in
connection with the actions or omissions which resulted in such loss, claim,
damage, liability or action, as well as any other relevant equitable
considerations.  The relative fault of
any Indemnified Party and any Indemnifying Party shall be determined by
reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or the omission or alleged omission to state a
material fact relates to information supplied by such Indemnified Party or such
Indemnifying Party and the parties’ relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.


 


4.4.2.       The parties hereto agree
that it would not be just and equitable if contribution pursuant to this
Section 4.4 were determined by pro  rata allocation or by any
other method of allocation which does not take account of the equitable
considerations referred to in the immediately preceding
Section 4.4.1.  The amount paid or
payable by an Indemnified Party as a result of any loss, claim, damage,
liability or action referred to in the immediately preceding paragraph shall be
deemed to include, subject to the limitations set forth above, any legal or
other expenses incurred by such Indemnified Party in connection with
investigating or defending any such action or claim.  Notwithstanding the provisions of this Section 4.4, no
holder of Registrable Securities shall be required to contribute any amount in
excess of the dollar amount


 


12

















 


of the net
proceeds (after payment of any underwriting fees, discounts, commissions or
taxes) actually received by such holder from the sale of Registrable Securities
which gave rise to such contribution obligation.  No person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation.


 


5.             UNDERWRITING AND
DISTRIBUTION.


 


5.1           Rule 144.  The Company covenants that it shall file any
reports required to be filed by it under the Securities Act and the Exchange
Act and shall take such further action as the holders of Registrable Securities
may reasonably request, all to the extent required from time to time to enable
such holders to sell Registrable Securities without registration under the
Securities Act within the limitation of the exemptions provided by
Rule 144 under the Securities Act, as such Rules may be amended from time
to time, or any similar Rule or regulation hereafter adopted by the
Commission.


 


6.             MISCELLANEOUS.


 


6.1           Other Registration
Rights.  The Company represents and
warrants that no person, other than a holder of the Registrable Securities, has
any right to require the Company to register any shares of the Company’s
capital stock for sale or to include shares of the Company’s capital stock in
any registration filed by the Company for the sale of shares of capital stock
for its own account or for the account of any other person.


 


6.2           Assignment; No Third
Party Beneficiaries.  This Agreement
and the rights, duties and obligations of the Company hereunder may not be
assigned or delegated by the Company in whole or in part.  This Agreement and the rights, duties and
obligations of the holders of Registrable Securities hereunder may be freely
assigned or delegated by such holder of Registrable Securities in conjunction
with and to the extent of any transfer of Registrable Securities by any such
holder.  This Agreement and the
provisions hereof shall be binding upon and shall inure to the benefit of each
of the parties and their respective successors and the permitted assigns of the
Investor or holder of Registrable Securities or of any assignee of the Investor
or holder of Registrable Securities. 
This Agreement is not intended to confer any rights or benefits on any
persons that are not party hereto other than as expressly set forth in
Article 4 and this Section 6.2.


 


6.3           Notices. All
notices, demands, requests, consents, approvals or other communications
(collectively, “Notices”) required or permitted to be given hereunder or
which are given with respect to this Agreement shall be in writing and shall be
personally served, delivered by reputable air courier service with charges
prepaid, or transmitted by hand delivery, telegram, telex or facsimile,
addressed as set forth below, or to such other address as such party shall have
specified most recently by written notice. 
Notice shall be deemed given on the date of service or transmission if
personally served or transmitted by telegram, telex or facsimile; provided,
that if such service or transmission is not on a business day or is after
normal business hours, then such notice shall be deemed given on the next
business day.  Notice otherwise sent as
provided herein shall be deemed given on the next business day following timely
delivery of such notice to a reputable air courier service with an order for
next-day delivery.


 


13

















 


	
  To the Company:

  
	
   

  
	
  International Shipping
  Enterprises, Inc.

  
	
  1225 Franklin Avenue,
  Suite 325

  
	
  Garden City, New York
  11530

  
	
  Attention:  Chairman

  
	
   

  
	
  with a copy to:

  
	
   

  
	
  Gusrae, Kaplan &
  Bruno, PLLC

  
	
  120 Wall Street

  
	
  11th Floor

  
	
  New York, NY 10005

  
	
  Attn:   Scott
  M. Miller, Esq.; and

  
	
   

  
	
  Graubard Miller

  
	
  600 Third Avenue

  
	
  New York, NY 10016-2097

  
	
  Attention: David Miller

  
	
   

  
	
  To an Investor, to:

  
	
   

  
	
  Angeliki Frangou

  	
  ; or

  
	
   

  
	
  Vasiliki Papaefthymiou

  	
  ; or

  
	
   

  
	
  Spyridon Magoulas

  	
  ; or

  
	
   

  
	
  Julian David Brynteson

  	
  ; or

  
	
   

  
	
  John Stratakis

  
	
   

  
	
  with a copy to:

  
	
   

  
	
  Graubard Miller

  
	
  600 Third Avenue

  
	
  New York, NY 10016-2097

  
	
  Attention: David Miller

  



 


14

















 


6.4                                 Severability.  This Agreement shall be deemed severable,
and the invalidity or unenforceability of any term or provision hereof shall
not affect the validity or enforceability of this Agreement or of any other
term or provision hereof.  Furthermore,
in lieu of any such invalid or unenforceable term or provision, the parties
hereto intend that there shall be added as a part of this Agreement a provision
as similar in terms to such invalid or unenforceable provision as may be
possible and be valid and enforceable.


 


6.5                                 Counterparts.  This Agreement may be executed in multiple
counterparts, each of which shall be deemed an original, and all of which taken
together shall constitute one and the same instrument.


 


6.6                                 Entire
Agreement.  This Agreement
(including all agreements entered into pursuant hereto and all certificates and
instruments delivered pursuant hereto and thereto) constitute the entire
agreement of the parties with respect to the subject matter hereof and
supersede all prior and contemporaneous agreements, representations,
understandings, negotiations and discussions between the parties, whether oral
or written.


 


6.7                                 Modifications
and Amendments.  No amendment,
modification or termination of this Agreement shall be binding upon any party
unless executed in writing by such party.


 


6.8                                 Titles
and Headings.  Titles and headings
of sections of this Agreement are for convenience only and shall not affect the
construction of any provision of this Agreement.


 


6.9                                 Waivers
and Extensions.  Any party to this
Agreement may waive any right, breach or default which such party has the right
to waive, provided that such waiver will not be effective against the
waiving party unless it is in writing, is signed by such party, and
specifically refers to this Agreement. 
Waivers may be made in advance or after the right waived has arisen or
the breach or default waived has occurred. 
Any waiver may be conditional. 
No waiver of any breach of any agreement or provision herein contained
shall be deemed a waiver of any preceding or succeeding breach thereof nor of
any other agreement or provision herein contained.  No waiver or extension of time for performance of any obligations
or acts shall be deemed a waiver or extension of the time for performance of
any other obligations or acts.


 


6.10                           Remedies
Cumulative.  In the event that the
Company fails to observe or perform any covenant or agreement to be observed or
performed under this Agreement, the Investor or any other holder of Registrable
Securities may proceed to protect and enforce its rights by suit in equity or
action at law, whether for specific performance of any term contained in this
Agreement or for an injunction against the breach of any such term or in aid of
the exercise of any power granted in this Agreement or to enforce any other
legal or equitable right, or to take any one or more of such actions, without
being required to post a bond.  None of
the rights, powers or remedies conferred under this Agreement shall be mutually
exclusive, and each such right, power or remedy shall be cumulative and in
addition to any other right, power or remedy, whether conferred by this
Agreement or now or hereafter available at law, in equity, by statute or
otherwise.


 


15

















 


6.11                           Governing
Law. This Agreement shall be governed by, interpreted under, and construed
in accordance with the internal laws of the State of New York applicable to
agreements made and to be performed within the State of New York, without
giving effect to any choice-of-law provisions thereof that would compel the
application of the substantive laws of any other jurisdiction.  


 


6.12                           Waiver
of Trial by Jury.  Each party hereby
irrevocably and unconditionally waives the right to a trial by jury in any
action, suit, counterclaim or other proceeding (whether based on contract, tort
or otherwise) arising out of, connected with or relating to this Agreement, the
transactions contemplated hereby, or the actions of the Investor in the
negotiation, administration, performance or enforcement hereof.


 


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INTENTIONALLY LEFT BLANK]


 


16

















 


IN WITNESS WHEREOF, the
parties have caused this Registration Rights Agreement to be executed and
delivered by their duly authorized representatives as of the date first written
above.


 


 


	
   

  	
  INTERNATIONAL SHIPPING

  ENTERPRISES, INC.

  
	
   

  	
  A Delaware corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Angeliki Frangou,
  Chairman

  
	
   

  	
   

  
	
   

  	
  INVESTORS:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Angeliki Frangou

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Vasiliki Papaefthymiou

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Spyridon Magoulas

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Julian David Brynteson

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  John Stratakis

  
					



 


17