Document:

exv10w15

Exhibit 10.15

 

 

GUARANTY

given by

GULFMARK OFFSHORE, INC.

in favor of

DVB BANK NV,

as Security Trustee

 

 

July 1, 2008

 

 

GUARANTY

          THIS GUARANTY (this “Guaranty”), dated as of July 1, 2008, is made by GULFMARK OFFSHORE, INC.,
a corporation organized and existing under the laws of Delaware (the “Guarantor”), in favor of DVB
BANK NV, a bank incorporated under the laws of the Kingdom of the Netherlands (“DVB”), as security
trustee (the “Security Trustee”) for and on behalf of the Lenders (as such term is defined herein).

WITNESSETH THAT:

          WHEREAS:

          (A) Pursuant to that certain that Senior Secured Credit Facility Agreement dated as of
December 28, 2005, as amended by Amendment No. 1 thereto dated as of February 28, 2006, by
Amendment No. 2 thereto dated as of May 9, 2007 and by Amendment No. 3 (“Amendment No. 3”) thereto
dated July 1, 2008 (as so amended, the “Facility Agreement”), made by and among, inter
alios, (i) Rigdon Marine Corporation, as borrower (the “Borrower”), (ii) the banks and
financial institutions listed on Schedule 1 of the Facility Agreement, as lenders (together with
any bank or financial institution which becomes a Lender pursuant to Article 10 of the Facility
Agreement (the “Lenders”)), and (iii) DVB, as security trustee and as facility agent, the Lenders
have agreed to provide the Borrower a loan facility in an aggregate principal amount of up to
US$224,000,000 (the “Facility”) in three tranches, Tranche A, Tranche B and Tranche C, for the
purposes described in Section 3.1 thereof.

          (B) The Borrower is a wholly owned subsidiary of the Guarantor; and

          (C) It is a condition precedent to the effectiveness of Amendment No. 3 that the Guarantor
enter into this Guaranty and otherwise agree to be bound by the terms of this Guaranty.

          NOW, THEREFORE, in consideration of the premises and for other valuable consideration, the
receipt and adequacy of which the Guarantor hereby acknowledges, the Guarantor hereby agrees as
follows:

          SECTION 1. Defined Terms. Except as otherwise defined herein, terms defined in the
Facility Agreement shall have the same meaning when used herein. The words and expressions
specified below shall, except where the context otherwise requires, have the meanings attributed to
them below:

          (a) “Compliance Certificate” means a certificate of the Chief Financial Officer of the
Guarantor to be delivered to the Facility Agent substantially in the form attached hereto as
Exhibit 1;

          (b) “Determination Date” means:

               (i) the last day of each calendar quarter;

 

 

               (ii) after the occurrence of an Event of Default which is continuing, any date designated by
the Facility Agent upon at least three (3) Banking Days’ prior written notice to the Guarantor; and

               (iii) each Drawdown Date.

          (c) “EBITDA” means, for any twelve month period ending on a Determination Date, the
consolidated profit on ordinary activities of the Group before Taxes:

               (i) adjusted to exclude interest received or receivable and other similar income to the
extent not already excluded;

               (ii) before the depreciation of fixed assets but after excluding any loss or gain arising on
the disposal of fixed assets or shares;

               (iii) before the deduction of Interest Expense for such period;

               (iv) before any charge for the amortization of goodwill, merger differences, acquisition costs
or any other intangible asset; and

               (v) before adding or deducting extraordinary or exceptional items (to include, for the
avoidance of doubt, any redundancy costs and foreign exchange profits and losses in relation to the
funding of the business) in each case for such period;

          (d) “Group” means the Guarantor and each of its Subsidiaries;

          (e) “Interest Expense” means the interest paid by any member of the Group on the Total
Debt in the twelve month period ending on a Determination Date;

          (f) “Taxes” means all taxes (including, without limitation, property, sales, use,
consumption, franchise, capital, occupational, license, value added, excise, stamp, levies and
imposts taxes and customs and other duties), assessments, fees (including, without limitation,
documentation, license, filing and registration fees) and charges, of any kind or nature
whatsoever, together with any penalties, fines, additions to tax or interest thereon, however
imposed, withheld, levied, or assessed by any country or governmental subdivision thereof or
therein, any international authority or any other taxing authority other than taxes on the overall
net income of a Creditor or branch thereof;

          (g) “Total Assets” means the amount which is equal to the total consolidated assets of
the Guarantor as shown in the Guarantor’s latest audited consolidated balance sheet less the
goodwill (if any) of the Guarantor as shown in the Guarantor’s latest audited balance sheet;

          (h) “Total Debt” means the aggregate of:

               (i) the amount calculated in accordance with GAAP shown as each of “long term debt”, “short
term debt” and “current portion of long term debt” on the latest consolidated balance sheet of the
Guarantor; and

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               (ii) the amount of any liability in respect of any lease or hire purchase contract entered
into by the Guarantor or any of its Subsidiaries which would, in accordance with GAAP, be treated
as a finance or capital lease; and

          (i) “Total Shareholder Equity” means the aggregate of the amount paid up on the issued
share capital of the Guarantor and the amount standing to the credit of its capital and revenue
reserves (including any share premium account or capital redemption reserve but excluding any
revaluation reserve) plus or minus the amount standing to the credit or debit (as the case may be)
of its profit and loss account.

          SECTION 2. Guaranty.

          2.1 Guaranty of Payment and Performance. The Guarantor, as primary obligor and not
merely as surety, hereby irrevocably, unconditionally and absolutely guarantees to the Security
Trustee, for the benefit of the Creditors, on first demand (a) the full and prompt payment, when
due, whether by acceleration or otherwise, of all amounts owing by the Borrower to the Creditors
under the Facility Agreement, the Note and the Security Documents (collectively, the “Transaction
Documents”), together with any costs and expenses (including, without limitation, attorneys’ fees)
incurred in connection therewith by the Creditors and the performance by the Borrower of its
obligations and, in case of extension of time of payment or renewal in whole or in part of the said
obligations of the Borrower, the prompt payment when due of all said amounts according to such
extension or extensions or renewal or renewals, whether by acceleration or otherwise and (b) the
punctual and full performance and compliance by the Borrower of each and every duty, covenant,
agreement and obligation thereof under the Transaction Documents (all obligations referred to in
clauses (a) and (b) above are herein referred to as the “Obligations”).

          2.2 Nature of Guaranty. This Guaranty is a guaranty of payment, performance and
compliance and not of collection and the Guarantor expressly agrees that it shall not be necessary
or required that the Creditors exercise any right, assert any claim or demand or enforce any remedy
whatsoever against the Borrower or any other Person before or as a condition to the obligations of
the Guarantor hereunder. This Guaranty is a primary obligation of the Guarantor and shall be an
absolute, unconditional, present, and continuing obligation and shall not be subject to any
counterclaim, setoff, deduction, diminution, abatement, recoupment, suspension, deferment,
reduction, or defense based on any claim the Guarantor or any other Person may have against the
Borrower, the Creditors or any other Person. This Guaranty shall only be discharged by the
complete and indefeasible satisfaction of all of the Obligations and shall not be released,
discharged or affected by any circumstance whatsoever, including without limitation:

          (a) the unenforceability, invalidity, irregularity or lack of genuineness of the Transaction
Document or any of the obligations under the Transaction Documents;

          (b) any amendment, modification, termination, or removal of, or addition or supplement to, the
Transaction Documents, or any change in time, manner, or place of payment or performance of any
Obligation;

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          (c) any assignment, mortgage, release, exchange, addition, or transfer of any Collateral;

          (d) any failure, refusal, omission or delay on the part of the Borrower, any Creditor or any
other Person to conform or comply with any term of the Transaction Documents or any other
agreement;

          (e) any waiver, consent, extension, indulgence, surrender, settlement, subordination, release,
compromise, or other agreement, or the exercise or non-exercise of any right or remedy thereunder,
with or without consideration;

          (f) the occurrence and/or continuance of any bankruptcy, insolvency, reorganization,
liquidation, arrangement, adjustment of debt, relief of debtors, dissolution, or similar proceeding
with respect to the Borrower, any Creditor, or any other Person, including without limitation any
modification of the Borrower’s obligations under any Transaction Document in connection with any
such proceeding;

          (g) any defect in the title, condition, compliance with specifications, design, operation, or
fitness for use of, or any damage to or loss of, or governmental prohibition or restriction,
condemnation, requisition, or seizure of, any Collateral for any reason;

          (h) any merger, consolidation, restructuring, termination of existence, sale of assets, or
change in the ownership of any membership interests, shares of capital stock or other equity
interest of the Borrower or the Guarantor;

          (i) any present or future law, regulation, or order in any jurisdiction (whether of right or
in fact) or any agency thereof affecting any term of any Obligation or any rights of any Creditor
with respect thereto, including, without limitation, any law, regulation or order purporting to
vary the terms of payment or to restrict the right or power of the Borrower or of the Guarantor or
either of them to make payment of any of their respective Obligations to the Creditors; or

          (j) any other circumstances whatsoever which might otherwise constitute a defense available
to, or a discharge of, either the Borrower or the Guarantor.

          SECTION 3. Representations and Warranties. The Guarantor hereby represents and
warrants to the Security Trustee, for the benefit of the Creditors, (which representations and
warranties shall survive the execution and delivery of this Guaranty) as follows:

          3.1 Due
Organization and Power. The Guarantor is duly formed and is validly existing in good standing
under the laws of its jurisdiction of incorporation or formation, has full power to carry on its
business as now being conducted and to enter into and perform its obligations under this Guaranty,
and has complied with all statutory, regulatory and other requirements relative to such business
and such agreements;

          3.2 Authorization and Consents. All necessary corporate action has
been taken to authorize, and all necessary consents and authorities have been obtained and remain
in full force and effect to permit, the Guarantor to enter into and perform its obligations under
this Guaranty;

          3.3 Binding Obligations. This Guaranty constitutes the legal, valid and
binding obligations of the Guarantor enforceable against the Guarantor in accordance with its
terms, except to the extent that such enforcement may be limited by equitable principles,

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principles of public policy or applicable bankruptcy, insolvency, reorganization, moratorium or
other laws affecting generally the enforcement of creditors’ rights;

          3.4 No Violation. The
execution and delivery of, and the performance of the provisions of, this Guaranty do not
contravene any applicable law or regulation existing at the date hereof or any contractual
restriction binding on the Guarantor or the certificate of incorporation or by-laws thereof.

          SECTION 4. Covenants.

          4.1 Affirmative Covenants. The Guarantor hereby covenants and undertakes with the
Security Trustee, for the benefit of the Creditors, that from the date hereof and so long as any
Obligation remains unsatisfied, it shall:

          (a) duly perform and observe the terms of this Guaranty;

          (b) immediately upon obtaining knowledge thereof, inform the Security Trustee of the
occurrence of (i) any Event of Default or of any event which, with the giving of notice or lapse of
time, or both, would constitute an Event of Default, (ii) any litigation or governmental proceeding
pending or threatened against it which could reasonably be expected to have a material adverse
effect on its or the Borrower’s business, assets, operations, property or financial condition and
(iii) any event or condition which is reasonably likely to have a material adverse effect on its
ability to perform its obligations under this Guaranty; and

          (c) obtain every consent and do all other acts and things which may from time to time be
necessary or advisable for the continued due performance of all its obligations under this
Guaranty.

          4.2 Financial Covenants. The Guarantor hereby covenants and undertakes with the
Security Trustee, for the benefit of the Creditors, that from the date hereof and so long as any
Obligation remains unsatisfied, it shall:

          (a) maintain a ratio of Total Shareholder Equity to Total Assets of at least thirty-five
percent (35%);

          (b) maintain a ratio of EBITDA to Interest Expense of no less than 2.25:1.00; and

          (c) deliver a completed and executed Compliance Certificate to the Facility Agent on such
dates as the Borrower is required to deliver its financial statements in accordance with Sections
9.1(d)(i) and 9.1(d)(ii) of the Facility Agreement.

          SECTION 5. Payments.

          5.1 Payment. (a) All payments by the Guarantor under this Guaranty shall be made in
the same manner as the Borrower is required to make payments under the Facility Agreement as
specifically set forth therein.

          (b) On any amount or amounts for which the Guarantor is liable hereunder interest shall be due
at the Default Rate specified in Section 6.2 in the Facility Agreement from

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the due date thereof
under the Facility Agreement until the date of payment of such amount by the Guarantor or the
Borrower.

          5.2 Currency of Account. (a) If for the purpose of obtaining or enforcing a judgment
in any court in any country, it becomes necessary to convert into any other currency (the “Judgment
Currency”) an amount due in Dollars under this Guaranty then the conversion shall be made, in the
discretion of the Security Trustee, at the rate of exchange prevailing either on the date of
default or on the day before the day on which the judgment is given or the order for enforcement is
made, as the case may be (the “Conversion Date”) provided that the Security Trustee shall not be
entitled to recover under this clause any amount in the Judgment Currency which exceeds at the
Conversion Date the amount in Dollars due under this Guaranty.

          (b) If there is a change in the rate of exchange prevailing between the Conversion Date and
the date of actual payment of the amount due, the Guarantor shall pay 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 then due under this Guaranty in Dollars; any excess over the amount due received
or collected by the Security Trustee shall be remitted to the Guarantor.

          (c) Any amount due from the Guarantor under this Section 5.2 shall be due as a separate debt
and shall not be affected by judgment being obtained for any other amounts due under or in respect
of this Guaranty or any of the other Transaction Documents; provided, however, that nothing herein
shall be construed so as to permit the Security Trustee to recover amounts from the Guarantor
previously paid by any other party other than as provided herein.

          (d) The term “rate of exchange” in this Section means the rate at which the Security Trustee
in accordance with its normal practices is able on the relevant date to purchase Dollars with the
judgment currency and includes any costs of exchange (including any premium) payable in connection
with such purchase.

          5.3 Taxes; Withholdings. Should the Guarantor be compelled by law, regulation,
decree, order or stipulation to make any deduction or withholding on account of any present or
future Taxes from any payment due under this Guaranty for the account of the Creditors, the amount
due from the Guarantor in respect of such payment shall be increased by such additional amounts
necessary to ensure that, after the making of such deduction or withholding with respect to Taxes,
the relevant Creditor receives a net amount equal to the amount which it would have received had no
such deduction or withholding with respect to Taxes been made and the Guarantor shall indemnify
each Creditor against any losses or costs incurred by it by reason of any failure of the Guarantor
to make any such deduction or withholding or by reason of any such additional payment not being
made to the Creditors on the due date for such payment. If at any time a Creditor is entitled to an exemption from or reduction of withholding tax under the law
of the applicable jurisdiction, then such Creditor shall deliver to the Guarantor such properly
completed and executed documentation prescribed by applicable law as will permit such payments
required under this Guaranty to be made without withholding or at a reduced rate of withholding.
The Guarantor shall deliver to the Security Trustee evidence satisfactory to the Security Trustee
including all relevant tax receipts that such Tax has been duly remitted to the

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appropriate
authority. Notwithstanding the preceding sentence, the Guarantor shall not be required to pay
additional amounts or otherwise indemnify the Creditors for or on account of:

          (a) Taxes based on or measured by the overall net income of any Creditor for Taxes in the
nature of franchise taxes or taxes for the privilege of doing business imposed by any jurisdiction
or any political subdivision or taxing authority therein unless such Taxes are imposed as a result
of the activities of the Borrower or the Guarantor within the relevant taxing jurisdiction; or

          (b) Taxes imposed by any jurisdiction or any political subdivision or taxing authority therein
on any Creditor that would not have been imposed but for the Creditor’s being organized in or
conducting business in or maintaining a place of business in the relevant taxing jurisdiction, or
engaging in activities or transactions in the relevant taxing jurisdiction that are unrelated to
the transactions contemplated by the Facility Agreement, but only to the extent such Taxes are not
imposed as a result of the activities of the Borrower or the Guarantor within the relevant taxing
jurisdiction or the legal status of the Borrower or the Guarantor under the laws of the taxing
jurisdiction.

          SECTION 6. Preservation of Rights.

          6.1 The Guarantor hereby consents: (a) that from time to time, without notice to or further
consent of the Guarantor, the time for the performance and/or observance by the Borrower or of the
Guarantor of any of the agreements, covenants or conditions in the Transaction Documents, or any of
them, on the part of the Borrower or the Guarantor, or either thereof, to be performed and/or
observed may be waived or the time of performance thereof extended by the Creditors and payment of
any amounts owing or payable under any such document may be extended or any such document may be
renewed in whole or in part or modified in any respect or any collateral or arrangement provided
for by any such document as security for any obligation contemplated by any such document may be
exchanged, surrendered, released or otherwise dealt with as the Creditors may determine; (b) that
the time for the making of any payment of any obligation hereby guaranteed may be accelerated in
accordance with any agreement between any of the Creditors and the Borrower or the Guarantor, and
that any of the acts mentioned in any of said documents may be done; and (c) that any other
guarantor of any of the obligations hereby guaranteed and/or any document or security therefor may
be released in whole or in part without affecting the obligations of the Guarantor hereunder.

          6.2 The Guarantor hereby waives, to the extent permitted by applicable law:

          (a) any notice required by law or otherwise to preserve any rights hereunder or under any
other Transaction Document against the Guarantor or against the Borrower, including without
limitation: (i) acceptance, presentment, demand, protest, or proof of nonperformance of
any Obligation, (ii) notice of the sale of any Collateral or the transfer by the Borrower of
any interest in any Collateral or any Transaction Document, (iii) notice of the acceptance of this
Guaranty and of any change in the Borrower’s financial condition, (iv) notices of the creation,
renewal, extension, or accrual of any Obligation or any of the matters referred to in Section 2
hereof, or any notice of or proof of reliance by any Creditor upon this Guaranty or acceptance of
this Guaranty (the Obligations, and any of them, shall conclusively be deemed to have been

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created,
contracted, incurred or renewed, extended, amended or waived in reliance upon this Guaranty and all
dealings between the Borrower or the Guarantor and the Creditors shall be conclusively presumed to
have been had or consummated in reliance upon this Guaranty), and (v) notices which may be required
by statute, rule of law or otherwise, now or hereafter in effect, to preserve intact any rights of
the Creditors against the Guarantor;

          (b) the prior exercise of any remedy contained in any Transaction Document or otherwise
available to the Creditors;

          (c) any requirement of diligence on the part of any Person including without limitation
diligence in making any claim or commencing suit hereon or on any other Transaction Document, and
any requirement to mitigate damages or exhaust remedies under any Transaction Document;

          (d) the right to interpose all substantive and procedural defense of the law of guaranty,
indemnification, suretyship, or other applicable law except the defense of prior payment or prior
performance by the Borrower or the Guarantor of the Obligations;

          (e) all rights and remedies accorded by applicable laws to guarantors or sureties, including
any extension of time conferred by any law now or hereafter in effect;

          (f) any right or claim of right to cause a marshaling of the Borrower’s assets or to cause the
Creditors to proceed against the Borrower or any collateral held by any Creditor at any time or in
any particular order;

          (g) rights to the enforcement, assertion, or exercise by the Creditors of any right, power,
privilege, or remedy conferred herein or any other Transaction Document or otherwise;

          (h) notices of the sale, transfer or other disposition of any right, title to, or interest in
any Transaction Document; and

          (i) any other right whatsoever which might otherwise constitute a discharge, release, or
defense of the Guarantor hereunder or of the Borrower or the Guarantor under any Transaction
Document or which might otherwise limit recourse against the Borrower or the Guarantor.

No failure to exercise and no delay in exercising, on the part of any Creditor, any right, power,
or privilege shall operate as a waiver thereof, nor shall any single or partial exercise of any
right, power, or privilege preclude any other or further exercise thereof, or the exercise of any
other power or right. The obligations of the Guarantor hereunder shall not be affected by receipt
by any Creditor of any proceeds of any security at any time held by a Creditor. The rights and
remedies herein provided are cumulative and not exclusive of any rights or remedies provided by
law.

          6.3 The Guarantor agrees that so long as the Borrower has any actual or contingent liability
under the Transaction Documents any rights which the Guarantor may at any time have by reason of
the performance by the Guarantor of its obligations hereunder (a) to be indemnified by the Borrower
and/or (b) to claim any contribution from any other guarantor of

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the Borrower’s obligations under
the Transaction Documents and/or (c) to take the benefit (in whole or in part) of any security
taken pursuant to this Guaranty or any other Transaction Document by all or any of the persons to
whom the benefit of the Guarantor’s obligations are given, shall be exercised by the Guarantor in
such manner and upon such terms as the Creditors may require and further agrees to hold any monies
at any time received by it as a result of the exercise of any such rights or otherwise for and on
behalf of and to the order of the Creditors, for application in or towards payment of any amounts
at any time owed by the Borrower under the Transaction Documents.

          6.4 The Guarantor agrees that its liabilities hereunder shall be unconditional irrespective of
any other circumstance which might otherwise constitute a discharge at law or in equity of a
guarantor or surety. The Guarantor guarantees that all payments made by the Borrower, the
Guarantor, or either of them, to the Security Trustee on any Obligation will, when made, be final
and agrees that, if any such payment is recovered from, or repaid by, the Creditors in whole or in
part in any bankruptcy, insolvency or similar proceeding instituted by or against the Borrower, or
the Guarantor, or either of them, this Guaranty shall continue to be fully applicable to such
obligation to the same extent as though the payment so recovered or repaid had never been
originally made on such obligation.

          6.5 The Creditors may enforce the obligations of the Guarantor hereunder without in any way
first pursuing or exhausting any other rights or remedies which the Creditors may have against the
Borrower, or against any other Person or against any security the Creditors may hold.

          6.6 The Guarantor hereby irrevocably waives all rights of subrogation (whether contractual,
under Section 509 of Title 11 of the United States Code entitled “Bankruptcy” as now or hereafter
in effect, or any successor thereto (herein called the “Bankruptcy Code”), under common law, or
otherwise) to the claims of any of the Creditors against the Borrower and all contractual,
statutory or common law rights of contribution, reimbursement, indemnification and similar rights
and “claims” (as such term is defined in the Bankruptcy Code) against the Borrower which arise in
connection with, or as a result of, this Guaranty, until such time as the obligations of the
Borrower under or in connection with the Transaction Documents have been indefeasibly paid in full.

          6.7 The Guarantor shall not assign, transfer, hypothecate or dispose of any claim that it has
or may have against the Borrower while any indebtedness of the Borrower to the Creditors remains
unpaid, without the written consent of the Creditors.

          6.8 Notice of acceptance by the Security Trustee of this Guaranty and of the incurring of any
or all of the obligations hereby guaranteed is hereby waived by the Guarantor, and this Guaranty and all of the terms and provisions hereof shall immediately be binding upon
the Guarantor from the date of execution hereof.

          SECTION 7. Fraudulent Conveyances; Fraudulent Transfers. (a) The Guarantor, and by
its acceptance of this Guaranty, the Security Trustee and each other Creditor, hereby confirms that
it is the intention of all such Persons that this Guaranty and the Obligations of the Guarantor
hereunder not constitute a fraudulent transfer or conveyance for purposes of any

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Proceeding, the
Uniform Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act or any similar foreign,
federal or state law to the extent applicable to this Guaranty and the Obligations of the Guarantor
hereunder. To effectuate the foregoing intention, the Security Trustee, the other Creditors and
the Guarantor hereby irrevocably agree that the Obligations of the Guarantor under this Guaranty at
any time shall be limited to the maximum amount as will result in the Obligations of the Guarantor
under this Guaranty not constituting a fraudulent transfer or conveyance.

          (a) The Guarantor hereby unconditionally and irrevocably agrees that in the event any payment
shall be required to be made to any Creditor under this Guaranty or any other guaranty, the
Guarantor shall contribute, to the maximum extent permitted by law, such amounts to each other
guarantor so as to maximize the aggregate amount paid to the Creditors under or in respect of the
Transaction Documents.

          SECTION 8. Miscellaneous.

          8.1 Further Assurances. The Guarantor agrees that if this Guaranty shall, in the
reasonable opinion of the Security Trustee, at any time be deemed by the Security Trustee, for any
reason, insufficient in whole or in part to carry out the true intent and spirit hereof, it shall
execute or cause to be executed such other documents or deliver or cause to be delivered such
further assurances as in the opinion of the Security Trustee may be required in order to more
effectively accomplish the purposes of this Guaranty including, without limitation, an alternative
guaranty or such other alternative agreement as the Security Trustee shall require.

          8.2 Remedies Cumulative and Not Exclusive; No Waiver. Each and every right, power and
remedy herein given to the Security Trustee shall be cumulative and shall be in addition to every
other right, power and remedy of the Security Trustee now or hereafter existing at law, in equity
or by statute, and each and every right, power and remedy, whether herein given or otherwise
existing, may be exercised from time to time, in whole or in part, and as often and in such order
as may be deemed expedient by the Security Trustee, and the exercise or the beginning of the
exercise of any right, power or remedy shall not be construed to be a waiver of the right to
exercise at the same time or thereafter any other right, power or remedy. No failure, delay or
omission by the Security Trustee or any of the Creditors in the exercise of any right or power or
in the pursuance of any remedy accruing upon any breach or default by the Guarantor or the Borrower
shall impair any such right, power or remedy or be construed to be a waiver of any such right,
power or remedy or to be an acquiescence therein; nor shall the acceptance by the Security Trustee
or any of the Creditors of any security or of any payment of or on account of any of the amounts
due from the Guarantor or the Borrower to the Security Trustee and maturing after any breach or
default or of any payment on account of any past breach or default be construed to be a waiver of any right with respect to any future breach or default or of any
past breach or default not completely cured thereby.

          8.3 Successors and Assigns. This Guaranty and all obligations of the Guarantor
hereunder shall be binding upon the successors and assigns of the Guarantor and shall, together
with the rights and remedies of the Security Trustee hereunder, inure to the benefit of the
Security Trustee, its respective successors and assigns.

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          8.4 Waiver; Amendment. None of the terms and conditions of this Guaranty may be
changed, waived, modified or varied in any manner whatsoever unless in writing duly signed by the
Guarantor and the Security Trustee (with the consent of the Majority Lenders).

          8.5 Invalidity. If any provision of this Guaranty shall at any time, for any reason,
be declared invalid, void or otherwise inoperative by a court of competent jurisdiction, such
declaration or decision shall not affect the validity of any other provision or provisions of this
Guaranty, or the validity of this Guaranty as a whole and, to the fullest extent permitted by law,
the other provisions hereof shall remain in full force and effect in such jurisdiction and shall be
liberally construed in favor of the Security Trustee in order to carry out the intentions of the
parties hereto as nearly as may be possible. The invalidity and unenforceability of any provision
hereof in any jurisdiction shall not affect the validity or enforceability of such provision in any
other jurisdiction.

          8.6 Notices. All notices, requests, demands and other communications to any party
hereunder shall be in writing (including prepaid overnight courier, facsimile transmission,
electronic transmission or similar writing) and shall be given to such party at the address,
facsimile number or email address set forth below or at such other address or facsimile numbers as
such party may hereafter specify for the purpose by notice to each other party hereto. Any notice
sent by facsimile or electronic transmission shall be confirmed by letter dispatched as soon as
practicable thereafter.

If to the Guarantor:

GulfMark Offshore, Inc.

10111 Richmond Ave., Suite 340

Houston, TX 77042

Phone: 713 963 9522

Facsimile: 713 963 0541

Attention: Quintin V. Kneen

If to the Security Trustee:

DVB BANK NV

Parklaan 2

3016 BB Rotterdam

The Netherlands

Attn:

Facsimile No.:

Telephone No.:

Every notice or other communication shall, except so far as otherwise expressly provided by this
Guaranty, be deemed to have been received (provided that it is received prior to 2 p.m. local time;
otherwise it shall be deemed to have been received on the next following Banking Day) (i) if given
by facsimile or electronic transmission, on the date of dispatch thereof (provided further that if
the date of dispatch is not a Banking Day in the locality of the party to whom such notice or
demand is sent, it shall be deemed to have been received on the next following Banking Day in such
locality) or (ii) if given by mail, prepaid overnight courier or any other means, when received at
the address specified in this Section or when delivery at such address is refused.

11

 

          8.7 Electronic Delivery. Delivery of an executed copy of this Guaranty by facsimile
or electronic transmission shall be deemed as effective as delivery of an originally executed copy.
In the event that the Guarantor delivers an executed copy of this Guaranty by facsimile or
electronic transmission, the Guarantor shall also deliver an originally executed copy as soon as
practicable, but the failure of the Guarantor to deliver an originally executed copy of this
Guaranty shall not affect the validity or effectiveness of this Guaranty.

          8.8 References. References herein to Sections, Exhibits and Schedules are to be
construed as references to sections of, exhibits to, and schedules to, this Guaranty, unless the
context otherwise requires.

          8.9 Headings. In this Guaranty, Section headings are inserted for convenience of
reference only and shall not be taken into account in the interpretation of this Guaranty.

          8.10 Termination. If the Borrower shall pay and discharge all of its obligations
under or in connection with the Facility Agreement or is released therefrom in accordance with the
terms thereof, all of the right, title and interest herein assigned all revert to the Guarantor and
this Guaranty shall terminate.

          SECTION 9. Applicable Law, Jurisdiction and Waivers.

          9.1 Governing Law. This Guaranty shall be governed by and construed in accordance
with the laws of the State of New York without regard to principles of conflicts of laws thereof
other than Sections 5-1401 and 5-1402 of the General Obligations Law of the State of New York.

          9.2 Submission to Jurisdiction. The Guarantor hereby irrevocably submits to the
jurisdiction of the courts of the State of New York and of the United States District Court for the
Southern District of New York in any action or proceeding brought against it by any of the
Creditors under this Guaranty or under any document delivered hereunder and hereby irrevocably
agrees that valid service of summons or other legal process on it may be effected by serving a copy
of the summons and other legal process in any such action or proceeding on the Guarantor by mailing
or delivering the same by hand to the Guarantor at the address indicated for notices in this
Guaranty. The service, as herein provided, of such summons or other legal process in any such
action or proceeding shall be deemed personal service and accepted by the Guarantor as such, and
shall be legal and binding upon the Guarantor for all the purposes of any such action or
proceeding. Final judgment (a certified or exemplified copy of which shall be conclusive evidence
of the fact and of the amount of any indebtedness of the Guarantor to the Creditors) against the Guarantor in any such legal action or proceeding shall be conclusive
and may be enforced in other jurisdictions by suit on the judgment. The Guarantor shall advise the
Security Trustee promptly of any change of address for the purpose of service of process.
Notwithstanding anything herein to the contrary, the Creditors may bring any legal action or
proceeding in any other appropriate jurisdiction.

          9.3 WAIVER OF IMMUNITY. TO THE EXTENT THAT THE GUARANTOR HAS OR HEREAFTER MAY ACQUIRE
ANY IMMUNITY FROM SUIT, JURISDICTION OF ANY COURT OR ANY LEGAL PROCESS (WHETHER THROUGH ATTACHMENT

12

 

PRIOR TO JUDGMENT, ATTACHMENT IN AID OF EXECUTION, EXECUTION OF A JUDGMENT, OR FROM ANY OTHER LEGAL
PROCESS OR REMEDY) WITH RESPECT TO ITSELF OR ITS PROPERTY, THE GUARANTOR HEREBY IRREVOCABLY WAIVES
SUCH IMMUNITY IN RESPECT OF ITS OBLIGATIONS UNDER THIS GUARANTY.

          9.4 WAIVER OF JURY TRIAL. EACH OF THE GUARANTOR AND THE SECURITY TRUSTEE, BY ITS
ACCEPTANCE HEREOF, HEREBY WAIVES TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM BROUGHT BY
ANY PARTY HERETO OR ANY BENEFICIARY HEREOF ON ANY MATTER WHATSOEVER ARISING OUT OF OR IN ANY WAY
CONNECTED WITH THIS GUARANTY.

[Signature page follows]

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          IN WITNESS WHEREOF, the Guarantor has caused this Guaranty to be executed and delivered on the
day and year first above written.

	 	 	 	 	 
	 	GULFMARK OFFSHORE, INC.

 	 
	 	By:  	/s/ Bruce Streeter
 	 
	 	 	Name:  	Bruce Streeter 	 
	 	 	Title:  	President & CEOexv10w16

Exhibit 10.16

 

 

FIRST PREFERRED FLEET MORTGAGE

RIGDON MARINE CORPORATION

as Owner

TO

DVB BANK NV,

as Mortgagee

Dated as of December 28, 2005

 

 

 

 

SYNOPSIS OF MORTGAGE

	 	 	 
	Name and Official 

Numbers of Vessel:

	 	As set forth in Schedule 1 hereto
	 
	 	 
	Type of Instrument:

	 	First Preferred Mortgage
	 
	 	 
	Date of Instrument:

	 	December 28, 2005
	 
	 	 
	Name of Owner

(Percentage of
Vessel owned):

	 	Rigdon Marine Corporation

(100%)
	 
	 	 
	Address of Owner:

	 	815 Walker Street, Suite 750

Houston, Texas 77002

United States of America

Facsimile: (703)236-0200

Attention: Larry T. Rigdon
	 
	 	 
	Name of Mortgagee:

	 	DVB Bank NV
	 
	 	 
	Address of Mortgagee:

	 	Parklaan 2

3016 BB Rotterdam

The Netherlands
	 
	 	 
	Total amount of
Mortgage:

	 	US$195,000,000 (exclusive of interest, expenses and
fees)

 

 

          THIS FIRST PREFERRED FLEET MORTGAGE is made and given this 28th day of December,
2005 by RIGDON MARINE CORPORATION, a corporation incorporated under the laws of the State of
Delaware, with offices at 815 Walker Street, Suite 750, Houston, Texas, 77002, United States of
America, (the “Owner”) in favor of DVB BANK NV, a bank incorporated under the laws of the Kingdom
of the Netherlands, with offices at Paarklan 2, 3016 BB Rotterdam, the Netherlands, as security
trustee (hereinafter, in such capacity, called the “Mortgagee”) for the Lenders (as such term is
defined in the Credit Agreement (as hereinafter defined)), pursuant to the terms of the Credit
Agreement.

          WHEREAS:

          A. The Owner is the sole legal and beneficial owner of the whole of each of the vessels listed
on Schedule 1 attached hereto and made a part hereof (the “Vessels” and each a “Vessel”).

          B. Pursuant to a Credit Facility Agreement dated as of December 28, 2005 (the “Credit Facility
Agreement”) and made by and among (i) Rigdon Marine Corporation, a corporation incorporated under
the laws of the State of Delaware (the “Borrower”), (ii) the Lenders (as such term is defined in
the Credit Facility Agreement) and (iii) DVB Bank NV (“DVB”), as underwriter, arranger, swap bank,
book manager, facility agent for the lenders (in such capacity, the “Facility Agent”) and security
trustee (in such capacity, the “Security Trustee”), a copy of the form of the Credit Facility,
without schedules or exhibits, other than schedule 1, is attached hereto as Exhibit A, pursuant to
which the Security Trustee has agreed to serve in such capacity under the Credit Facility Agreement
and the Lenders have agreed to provide to the Borrower a senior secured term loan credit facility
in the amount of up to US$170,000,000 (the “Loan”). The obligation of the Borrower to repay the
Loan under the Credit Agreement being evidenced by a promissory note dated the date hereof from the
Borrower to the order of the Security Trustee (the “Note”), a copy of the form of the Note being
attached hereto as Exhibit B. The Loan, and interest, fees and commissions thereon are to be
repaid or paid, as the case may be, as provided in the Credit Agreement. Unless otherwise defined
herein, terms defined in the Credit Agreement shall have the same meaning when used herein.

          C. The Owner has agreed to enter into certain Interest Rate Agreements with the Mortgagee for
an amount equal to the full amount of the Loan and the Owner has agreed that this Mortgage shall
secure amounts owing to the Lenders thereunder in an amount of up to US$25,500,000 (the “Swap
Liabilities”).

          D. Pursuant to Section 15 of the Credit Agreement, each of the Lenders has appointed the
Mortgagee as agent and security trustee on its behalf with regard to, inter alia,
the security conferred on such Lenders pursuant to the Credit Agreement, the Note and the Security
Documents.

          E. The Owner, in order to secure the payment of the Obligations, as that term is defined in
subsection 1(A)(iv) hereof, and to secure the performance and observance of and compliance with all
the covenants, terms and conditions in the Credit Agreement and in this Mortgage contained,
expressed or implied, to be performed, observed and complied with by and on the part of the Owner,
has duly authorized the execution and delivery of this First Preferred

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Fleet Mortgage under and pursuant to the United States Ship Mortgage Act, 1920, as amended,
inter alia, by Public Law 100-710 (46 USC Section 30101 et seq.)
(the “Ship Mortgage Act”).

          NOW, THEREFORE, THIS MORTGAGE WITNESSETH:

          1. Definitions: In this Mortgage, unless the context otherwise requires:

	(A) 	(i)	 	“Classification Society” means the member of the International Association
of Classification Societies, as defined in the Credit Agreement, with whom the Vessel
is entered and who conducts periodic physical surveys and/or inspections of the Vessel;
	 
	 	(ii)	 	“Earnings” includes all freight, hire and passage moneys,
compensation payable in event of requisition of the Vessel for hire,
remuneration for salvage and towage services, demurrage and detention moneys
and any other earnings whatsoever payable and belonging to the Owner due or to
become due in respect of the Vessel at any time during the Security Period;
	 
	 	(iii)	 	“Insurances” includes all policies and contracts of
insurance and all entries of the Vessels in a protection and indemnity or war
risks association or club which are from time to time taken out or entered
into pursuant to this Mortgage in respect of each Vessel and its Earnings or
otherwise howsoever in connection with such Vessel;
	 
	 	(iv)	 	“Mortgage” means this first preferred fleet mortgage;
	 
	 	(v)	 	“Obligations” means the obligations of the Borrower under or
in connection with the Credit Agreement, the Note, the Interest Rate
Agreements, this Mortgage and any other Security Document, including but not
limited to the obligations to repay the Loan when due;
	 
	 	(vi)	 	“Person” means an individual, corporation, limited
partnership, general partnership, syndicate, joint venture, association,
trust, unincorporated organization, trustee or other legal representative;
	 
	 	(vii)	 	“Requisition Compensation” means all moneys or other
compensation payable and belonging to the Owner during the Security Period by
reason of requisition for title or other compulsory acquisition of any Vessel
or otherwise than by requisition for hire;
	 
	 	(viii)	 	“Security Documents” when used herein shall have the same meaning as in the
Credit Agreement;

3

 

	 	(ix)	 	“Security Period” means the period commencing on the date
hereof and terminating upon discharge of the security created by this Mortgage
by payment in full of the Obligations;
	 
	 	(x)	 	“Subordinated Loan Agreement” means the agreement dated
December [27], 2005, made by and among the Subordinated Lender providing for a
subordinated loan in the amount of up to $90,000,000;”
	 
	 	(xi)	 	“Subordinated Lender” means Bourbon Capital USA, Inc.
	 
	 	(xii)	 	“Subordinated Mortgage” means the second preferred fleet
mortgage to be granted by the Owner in favor of the Subordinated Lender
securing the Owner’s obligation under the Subordinated Loan Agreement.
	 
	 	(xiii)	 	“Total Loss” means:

	 	(a)	 	actual, constructive or compromised or arranged
total loss of any Vessel;
	 
	 	(b)	 	requisition for title or other compulsory acquisition of any Vessel (otherwise than by requisition
for hire) which shall continue for thirty (30) days; or
	 
	 	(c)	 	capture, seizure, arrest, detention or confiscation of any Vessel by any government or by
persons acting or purporting to act on behalf of any government unless such Vessel be released and
restored to the Owner from such capture, seizure, arrest, detention or confiscation within thirty
(30) days after the occurrence thereof; ) and

	 	(xiv)	 	“Vessel” means the whole of each of the vessels listed on Schedule 1
hereto and includes its engines, machinery, boats, boilers, masts, rigging,
anchors, chains, cables, apparel, tackle, outfit, spare gear, fuel,
consumable or other stores, freights, belongings and appurtenances, whether
on board or ashore, whether now owned or hereafter acquired, and all
additions, improvements and replacements hereafter made in or to said
vessels, or any parts thereof, or in or to the stores, belongings and
appurtenances aforesaid except such equipment or stores which, when placed
aboard said vessels, do not become the property of the Owner.

(B) In Section 5(B) hereof:

	 	(i)	 	“excess risks” means the proportion of claims for general
average and salvage charges and under the ordinary running-down clause not
recoverable in consequence of the value at which a vessel is assessed for the
purpose of such claims exceeding her insured value;

4

 

	 	(ii)	 	“protection and indemnity risks” means the usual risks covered
by a United States or an English or another protection and indemnity
association or club acceptable to the Mortgagee including the proportion not
recoverable in case of collision under the ordinary running-down clause; and
	 
	 	(iii)	 	“war risks” means the risk of mines and all risks excluded from
the standard form of United States marine policy by the War, Strikes and Related
Exclusion Clause.

(C) This Mortgage shall be read together with the Credit Agreement but in case of any
conflict between the two, the provisions of the Credit Agreement shall prevail.

          2. Grant of Mortgage; Representations and Warranties.

          2.1 In consideration of the premises and of other good and valuable consideration, the
receipt and adequacy whereof are hereby acknowledged, and in order to secure the payment of the
Obligations and to secure the performance and observance of and compliance with the covenants,
terms and conditions in the Credit Agreement, the Note, this Mortgage and the other Security
Documents contained, the Owner has granted, conveyed and mortgaged and does by these presents
grant, convey and mortgage to and in favor of the Mortgagee, its successors and assigns, the whole
of each of the Vessels TO HAVE AND TO HOLD the same unto
the Mortgagee, its successors and assigns, forever, upon the terms set forth in this Mortgage for
the enforcement of the payment of the Obligations and to secure the performance and observance of
and compliance with the covenants, terms and conditions in this Mortgage, the Credit Agreement, the
Note and the other Security Documents contained;

          PROVIDED, ONLY, and the conditions of these presents are such that, if the Owner and/or its
successors or assigns shall pay or cause to be paid to the Lenders, their respective successors and
assigns, the Obligations as and when the same shall become due and payable in accordance with the
terms of this Mortgage, the Credit Agreement, the Note and the other Security Documents and shall
perform, observe and comply with all and singular of the covenants, terms and conditions in this
Mortgage, the Credit Agreement, the Note and the other Security Documents contained, expressed or
implied, to be performed, observed or complied with by and on the part of the Owner or its
successors or assigns, all without delay or fraud and according to the true intent and meaning
hereof and thereof, then, these presents and the rights of the Mortgagee under this Mortgage shall
cease and determine and, in such event, the Mortgagee agrees by accepting this Mortgage, at the
expense of the Owner, to execute all such documents as the Owner may reasonably require to
discharge this Mortgage under the laws of the United States of America; otherwise to be and remain
in full force and effect.

          2.2 The Owner hereby represents and warrants to the Mortgagee that:

          (A) the Owner is a corporation duly organized, validly existing and in good standing under the
laws of the State of Delaware qualified to own and register the Vessels under

5

 

the United States flag and to operate the Vessels in the foreign commerce of the United States of America;

          (B) the Owner lawfully owns the whole of each Vessel free from any security interest, debt,
lien, mortgage, charge, encumbrance or other adverse interest, other than the encumbrance of this
Mortgage, the Subordinated Mortgage and except as permitted by Section 5(N) hereof; and

          (C) each Vessel is tight, staunch and strong and well and sufficiently tackled, appareled,
furnished and equipped and in all respects seaworthy.

          3. Payment of Obligations. The Owner hereby further covenants and agrees to pay the
Obligations when due to the Mortgagee or its successors or assigns; provided that the recourse of
the Mortgagee hereunder shall be limited to the Vessels, the proceeds of the sale of the Vessels
whether pursuant to this Mortgage or otherwise and any moneys received by the Mortgagee as Security
Trustee pursuant to any of the Security Documents.

          4. Covenants Regarding Security Granted Hereunder. It is declared and agreed that:

          (A) The security created by this Mortgage shall be held by the Mortgagee as a continuing
security for the payment of the Obligations and that the security so created shall not be satisfied
by any intermediate payment or satisfaction of any part of the amount hereby secured.

          (B) Any settlement or discharge under this Mortgage between the Mortgagee and the Owner shall
be conditional upon no security or payment to the Mortgagee or the Lenders, related to or which
reduces the obligations secured hereby, by the Owner or any other person being avoided or set-aside
or ordered to be refunded or reduced by virtue of any provision or enactment relating to
bankruptcy, insolvency or liquidation for the time being in force, and if such condition is not
satisfied, the Mortgagee shall be entitled to recover from the Owner on demand the value of such
security or the amount of any such payment as if such settlement or discharge had not occurred.

          (C) The rights of the Mortgagee under this Mortgage and the security hereby constituted shall
not be affected by any act, omission, matter or thing which, but for this provision, might operate
to impair, affect or discharge such rights and security, including without limitation, and whether
or not known to or discoverable by the Owner, the Mortgagee or any other person:

          (i) any time or waiver granted to the Owner or any other person; or

          (ii) the taking, variation, compromise, renewal or release of or refusal or neglect to
perfect or enforce any rights, remedies or securities against the Owner any other person; or

6

 

          (iii) any legal limitation, disability, dissolution, incapacity or other circumstances
relating to the Borrower or any other person; or

          (iv) any amendment or supplement to the Credit Agreement, the Note or any of the Security
Documents; or

          (v) the unenforceability, invalidity or frustration of any obligations of the Borrower or any
other person under the Credit Agreement, the Note or any of the Security Documents.

          (D) The Owner acknowledges and agrees that it has not received any security from any person
for the granting of this Mortgage and it will not take any such security without the prior written
consent of the Mortgagee, and the Owner will hold any security taken in breach of this provision in
trust for the Mortgagee.

          (E) Until the Obligations have been unconditionally and irrevocably paid and discharged in
full to the satisfaction of the Mortgagee, the Owner shall not by virtue of any payment made under
the Credit Agreement, the Note or this Mortgage on account of such moneys and liabilities or by
virtue of any enforcement by the Mortgagee of its right under or the security constituted by this
Mortgage:

(i) be entitled to exercise any right of contribution from any co-surety
liable in respect of such moneys and liabilities under any other guarantee,
security or agreement; or

(ii) exercise any right of set-off or counterclaim against any such
co-surety; or

(iii) receive, claim or have the benefit of any payment, distribution,
security or indemnity from any such co-surety; or

(iv) unless so directed by the Mortgagee (which the Owner shall prove in
accordance with such directions), claim as a creditor of any such co-surety
in competition with the Mortgagee.

          The Owner shall hold in trust for the Mortgagee and forthwith pay or transfer (as appropriate)
to the Mortgagee any such payment (including an amount equal to any such set-off), distribution or
benefit of such security, indemnity or claim in fact received by it.

          (F) The Owner hereby irrevocably subordinates all of its rights of subrogation (whether
contractual, statutory, under common law or otherwise) to the claims of the Mortgagee against any
person and all contractual, statutory or common law rights of contribution,
reimbursement indemnification and similar rights and claims against any person which arise in
connection with, or as a result of, the Credit Agreement or this Mortgage until full and final
payment of all of the Obligations.

7

 

          5. Affirmative Covenants and Insurances. The Owner further covenants with the
Mortgagee and undertakes at all times throughout the Security Period:

          (A) to comply with and satisfy all the requisites and formalities established by the laws of
the State of Delaware in respect of its legal existence and good standing and to maintain its
status as a citizen of the United States, within the meaning of Section 2 of the United States
Shipping Act, 1916 (the “Shipping Act”) qualified to operate vessels in the United States coastwise
trade, and to give evidence in respect of the foregoing to the Mortgagee;

          (B) (i) to insure and keep each Vessel insured or cause or procure each Vessel to be insured
and to be kept insured at no expense to the Mortgagee (or, with regard to the insurance cover
described in (d) below, to reimburse the Mortgagee therefor) in regard to:

	 	(a)	 	all risks hull and machinery (including excess risks);
	 
	 	(b)	 	war risks (including war protection and indemnity liability)
covering, inter alia, the perils of confiscation, expropriation,
nationalization, seizure and blocking; and
	 
	 	(c)	 	protection and indemnity risks (including pollution risks);

          (ii) with respect to each Vessel, to effect the Insurances aforesaid or to cause or procure
the same to be effected:

	 	(a)	 	in the cases of the Insurances referred to in sub-sections (i)
(a), (b) and (d) above, (x) in such amounts as shall be at least equivalent to
the higher of (I) One Hundred Ten percent (110%) of the principal outstanding
at all times multiplied by a fraction, the numerator of which is the Fair
Market Value of the Vessel and the Denominator of which is the Fair Market
Value of all vessels then mortgaged to the Mortgagee in respect of the Credit
Facility Agreement (as determined in accordance with the Credit Facility
Agreement) and (II) the full commercial value of the Vessel, and (y) upon such
terms (including provisions as to named insureds and loss payees and prior
notice of cancellation) and with such deductibles as shall from time to time be
approved by the Mortgagee;
	 
	 	(b)	 	in the case of the protection and indemnity Insurances referred
to in sub-section (i)(c) above payable in lawful money of the United States of
America, to the full extent commercially available (which is currently
$1,000,000,000 in respect of pollution risks) and to include provisions as to
loss payees and prior notice of cancellation in form and substance satisfactory
to the Mortgagee; and
	 
	 	(c)	 	with first class insurance companies, underwriters and
protection and indemnity associations or clubs as shall from time to time be
approved by the Mortgagee (hereinafter called “the Insurers”);

8

 

          (iii) to renew all such Insurances or cause or procure the same to be renewed before the
relevant policies or contracts expire and to procure that the Insurers or the firm of insurance
brokers referred to herein below shall promptly confirm in writing to the Mortgagee as and when
each such renewal is effected;

          (iv) to procure concurrently with the execution hereof and thereafter at intervals of not more
than twelve (12) calendar months, a detailed report from a firm of independent marine insurance
brokers, appointed by the Owner and acceptable to the Mortgagee, with respect to the Insurances
together with their opinion to the Mortgagee that the Insurances comply with the provisions of this
Section 5(B), such report and opinion to be addressed and delivered promptly to the Mortgagee and
the costs of such report and opinion to be for the account of the Owner;

          (v) to cause the said independent marine insurance brokers or the Insurers to agree to use
reasonable efforts to advise the Mortgagee promptly of any failure to renew any of the Insurances
and of any default in payment of any premium and of any other act or omission on the part of the
Owner of which they have knowledge and which might, in their opinion, invalidate or render
unenforceable, or cause the lapse of or prevent the renewal or extension of, in whole or in part,
any Insurances on each Vessel;

          (vi) to cause the said independent marine insurance brokers to agree to mark their records and
to use their best efforts to advise the Mortgagee, at least fourteen (14) days prior to the
expiration date of any of the Insurances, that such Insurances have been renewed or replaced with
new insurance which complies with the provisions of this Section 5(B);

          (vii) duly and punctually to pay or to cause duly and punctually to be paid all premiums,
calls, contributions or other sums payable in respect of all such Insurances, to produce or to
cause to be produced all relevant receipts when so required by the Mortgagee and duly and
punctually to perform and observe or to cause duly and punctually to be performed and observed any
other obligations and conditions under all such Insurances;

          (viii) to execute or use reasonable efforts to cause to be executed such guarantees as may
from time to time be required by any relevant protection and indemnity association or club;

          (ix) to procure that all policies, binders, cover notes or other instruments of the Insurances
referred to in subsections (i)(a) and (b) above shall be taken out in the name of the Owner, with
the Mortgagee as an additional assured (without liability for premiums), as its or their respective
interests may appear, and shall incorporate a loss payable clause naming the Mortgagee as loss
payee prepared in compliance with the terms of this Mortgage and such loss payable clause to be in
any event in form and substance acceptable to the Mortgagee and all
policies, binders, cover notes or other instruments referred to in subsection (i) shall provide (a)
for prior notice of at least fourteen (14) days to be given to the Mortgagee before cancellation of
insurance for any reason whatsoever and for a waiver of liability for payment of premiums as to the
Mortgagee; provided, however, that unless otherwise required by the Mortgagee by
notice to

9

 

the underwriters, although all losses under such Insurances are payable to the Mortgagee,
in case of any such losses involving any damage to any Vessel the underwriters may pay direct for
the repair, salvage and other charges involved or, if the Owner shall have first fully repaired the
damage or paid all of the salvage and other charges may pay the Owner as reimbursement therefor,
provided, further, however, that if such damage involves a loss in excess
of U.S.$1,000,000, or its equivalent, the underwriters shall not make such payment without first
obtaining the written consent thereto of the Mortgagee and (b) in the event that any Vessel shall
be insured under any form of fleet cover, undertakings that the brokers, underwriters, association
or club (as the case may be) will not set off claims relating to such Vessel against premiums,
calls or contributions in respect of any other vessel or other insurance and that the insurance
cover of such Vessel will not be cancelled by reason of non-payment of premiums, calls or
contributions relating to any other vessel or other insurance;

          (x) to procure that all entries, policies, binders, cover notes or other instruments of the
Insurances referred to in sub-section (i)(c) above incorporate a loss payable clause naming the
Mortgagee as loss payee prepared in compliance with the terms of this Mortgage and such loss
payable clause to be in any event in form and substance acceptable to the Mortgagee and shall
provide for prior notice of at least fourteen (14) days to be given to the Mortgagee before
cancellation of insurance for any reason whatsoever and for a waiver of liability for payment of
premiums, backcalls and assessments as to the Mortgagee, it being agreed that although such
insurance is payable to the Mortgagee so long as no Event of Default has occurred and is continuing
under this Mortgage, any loss payments under any such insurance on any Vessel may be paid directly
to the Owner to reimburse it for any loss, damage or expenses incurred by it and covered by such
insurance or to the person to whom any liability covered by such insurance has been incurred;

          (xi) to procure that originals or photocopies of all such instruments of Insurances as are
referred to in sub-sections (ix) and (x) above shall be from time to time deposited with the
Mortgagee after receipt by the Owner thereof and that the Insurers shall, if so requested by the
Mortgagee, furnish the Mortgagee with a letter or letters of undertaking in such form as may be
reasonably required by the Mortgagee in respect of such Insurances;

          (xii) not to change any terms of any Insurances or suffer them to be changed, or change
underwriters of any Insurances or suffer them to be changed, without the Mortgagee’s prior written
approval;

          (xiii) not to employ any Vessel or suffer any Vessel to be employed otherwise than in
conformity with the terms of all policies, binders, cover notes or other instruments of the
Insurances (including any warranties express or implied therein) without first obtaining the
written consent of the Insurers to such employment (if required by such Insurers) and complying
with such requirements as to extra premiums or otherwise as the Mortgagee and/or the Insurers may
prescribe; and

          (xiv) to do all things necessary and proper, and execute and deliver all documents and
instruments to enable the Mortgagee to collect or recover any moneys to become due the Mortgagee in
respect of the Insurances.

10

 

          (C) To keep and to cause each Vessel to be kept in a good and efficient state of repair so as
to enable her to maintain her present class with its Classification Society and so as to enable her
to qualify to navigate the routes presently permitted under, and subject to the existing conditions
as are set forth in, the current United States Coast Guard Certificates of Inspection covering each
Vessel and so as to comply with the provisions of such Certification of Inspection, as well as all
laws, regulations and other requirements (statutory or otherwise) from time to time applicable to a
similar vessel of her age, type and trade registered under the flag of the United States of
America, and to procure that all repairs to or replacements of any damaged, worn or lost parts or
equipment be effected in such manner (both as regards workmanship and quality of materials) as not
to diminish the value of any Vessel;

          (D) To submit or to cause each Vessel to be submitted on a timely basis to such periodic or
other surveys as may be required for classification purposes and, if requested by the Mortgagee, to
supply or to cause to be supplied to the Mortgagee copies of all survey and inspection reports and
confirmations of class issued in respect thereof;

          (E) To permit the Mortgagee, by surveyors or other persons appointed by it in its behalf, to
board any Vessel at all reasonable times for the purpose of inspecting her condition or for the
purpose of satisfying themselves in regard to proposed or executed repairs and to afford or to
cause to be afforded all proper facilities for such inspections, provided that such inspections
will cause no undue delay to such Vessel;

          (F) (i) To pay and discharge or to cause to be paid and discharged all debts, damages and
liabilities whatsoever which have given or may give rise to maritime or possessory liens on or
claims enforceable against any Vessel except to the extent permitted by Section 5(N) hereof and
(ii) in event of arrest of any Vessel pursuant to legal process or in event of her detention in
exercise or purported exercise of any such lien as aforesaid to procure the release of such Vessel
from such arrest or detention within fifteen (15) days of receiving notice thereof by providing
bail or otherwise as the circumstances may require;

          (G) Not to employ any Vessel or suffer her employment in any trade or business which is
forbidden by the laws of the United States of America or is otherwise illicit or in carrying
illicit or prohibited goods or in any manner whatsoever which may render her liable to condemnation
in a Prize Court or to destruction, seizure or confiscation and in event of hostilities in any part
of the world (whether war be declared or not), not to employ any Vessel or suffer her employment in
carrying any contraband goods or to enter or trade to any zone which is declared a war zone by any
government or by the Vessels’ War Risks Insurers unless the required extra war risk insurance cover
has been obtained for each Vessel;

          (H) Promptly to furnish or to use its best efforts to cause promptly to be furnished to the
Mortgagee all such information as the Mortgagee may from time to time reasonably
request regarding any Vessel, her employment, position and engagements, particulars of all towages
and salvages and copies of all charters and other contracts for her employment or otherwise
howsoever pertaining to any Vessel;

11

 

(I) Promptly after learning of the same to notify or cause to be notified the
Mortgagee forthwith in writing of:

(i) any accident to any Vessel involving repairs the cost whereof will or is likely
to exceed U.S.$500,000 (or the equivalent in any other currency);

(ii) any occurrence in consequence whereof any Vessel has become or is likely to
become a Total Loss;

(iii) any material requirement or recommendation made by any Insurer or
classification society or by any competent authority which is not complied with in
accordance with reasonable commercial practices;

(iv) any arrest of any Vessel or the exercise or purported exercise of any lien on
any Vessel or her Earnings; and

(v) any occurrence of circumstances forming the basis of an Environmental Claim.

          (J) To keep or to cause to be kept proper books of account of the Owner in respect of the
Vessel and her Earnings and, if requested by the Mortgagee, to make or to cause to be made such
books available for inspection on behalf of the Mortgagee and furnish or cause to be furnished
satisfactory evidence that the wages and allotments and the insurance and pension contributions of
the Master and crew are being regularly paid and that all deductions from crew’s wages in respect
of any tax liability are being properly accounted for and that the Master has no claim for
disbursements other than those incurred by him in the ordinary course of trading on the voyage then
in progress;

          (K) To assign and provide that Requisition Compensation is applied in accordance with Section
8 hereof as if received in respect of the sale of any Vessel;

          (L) Not, without the previous consent in writing of the Mortgagee, to put any Vessel or
suffer her to be put into the possession of any person for the purpose of work being done upon her
other than routine drydockings and ordinary maintenance in an amount exceeding or likely to exceed
U.S.$750,000 (or the equivalent in any other currency) unless such work is fully covered by
insurance, subject to applicable deductibles satisfactory to the Mortgagee, or unless such person
shall first have given to the Mortgagee and on terms satisfactory to it a written undertaking not
to exercise any lien on such Vessel or her Earnings for the cost of such work or otherwise;

          (M) To keep each Vessel registered under the flag of the United States of America qualified
to operate in the foreign trade of the United States of America and to do or suffer to be done
nothing whereby such registration may be forfeited or imperiled;

          (N) To keep and to cause each Vessel to be kept free and clear of all liens, charges,
mortgages and encumbrances except in favor of the Mortgagee, the Subordinated

12

 

Mortgage, and except
for crew’s wages remaining unpaid in accordance with reasonable commercial practices or for
collision or salvage, liens in favor of suppliers of necessaries or other similar liens arising in
the ordinary course of its business, accrued for not more than thirty (30) days (unless any such
lien is being contested in good faith and by appropriate proceedings or other acts and the Owner
shall have set aside on its books adequate reserves with respect to such lien and so long as such
deferment in payment shall not subject such Vessel to forfeiture or loss) or liens for loss, damage
or expense which are fully covered by insurance, subject to applicable deductibles satisfactory to
the Mortgagee, or in respect of which a bond or other security has been posted by or on behalf of
the Owner with the appropriate court or other tribunal to prevent the arrest or secure the release
of such Vessel from arrest, and not, except in favor of the Mortgagee, to pledge, charge, assign or
otherwise encumber (in favor of any person other than the Mortgagee) her Insurances, Earnings or
Requisition Compensation or to suffer the creation of any such pledge, charge, assignment or
encumbrance as aforesaid to or in favor of any person other than the Mortgagee;

          (O) Not, without the previous consent in writing of the Mortgagee (and then only subject to
such terms and conditions as the Mortgagee may impose), to sell (otherwise than on an arm’s length
basis), abandon or otherwise dispose of such Vessel or any interest therein except as may be
permitted by the Loan Agreement;

          (P) To pay promptly to the Mortgagee all moneys (including reasonable fees of counsel)
whatsoever which the Mortgagee shall or may expend, be put to or become liable for, in or about the
protection, maintenance or enforcement of the security created by this Mortgage or in or about the
exercise by the Mortgagee of any of the powers vested in it hereunder and to pay interest thereon
at the Default Rate from the date whereon such expense or liability was incurred by the Mortgagee;

          (Q) To comply with all declaration and reporting requirements imposed by the protection and
indemnity club or insurers including, without limitation, the quarterly declarations required by
the U.S. Oil Pollution Section 20/2/91, and to pay all premiums required to maintain in force the
necessary U.S. Oil Pollution Cover;

          (R) To comply with and satisfy all the requisites and formalities established by the laws of
the United States of America to perfect this Mortgage as a legal, valid and enforceable first and
preferred lien upon the Vessels and to furnish to the Mortgagee from time to time such proofs as
the Mortgagee may reasonably request for its satisfaction with respect to the compliance by the
Owner with the provisions of this Section 5(R);

          (S) Not without the previous consent of the Mortgagee in writing, which consent shall not be
unreasonably withheld, to let any Vessel or permit any Vessel to be let on demise charter for any
period;

          (T) To place or to cause to be placed and at all times and places to retain or to cause to be
retained a properly certified copy of this Mortgage on board each Vessel with her papers and cause
this Mortgage to be exhibited to any and all persons having business with each Vessel which might
give rise to any lien thereon other than liens for crew’s wages and salvage,

13

 

and to any
representative of the Mortgagee on demand; and to place and keep or to cause to be placed and kept
prominently displayed in the chart room and in the Master’s cabin of each Vessel a framed printed
notice in plain type in English of such size that the paragraph of reading matter shall cover a
space not less than six inches wide by nine inches high, reading as follows:

“NOTICE OF MORTGAGE

This Vessel is owned by RIGDON MARINE CORPORATION, and is subject to a First
Preferred Fleet Mortgage (the “Fleet Mortgage”) in favor DVB BANK NV, as security
trustee, under the authority of the United States Ship Mortgage Act, 1920, as
amended interalia, by Public Law 100-710 (46 USC Section 30101 et seq.). Under the
terms of the said First Preferred Fleet Mortgage, neither the Owner nor any
charterer nor the Master of this Vessel nor any other person has any power, right or
authority whatever to create, incur or permit to be imposed upon this Vessel any
lien or encumbrance except for crew’s wages and salvage.”

          6. Mortgagee’s Right to Cure. Without prejudice to any other rights of the Mortgagee
hereunder:

(i) in the event that the provisions of Section 5(B) hereof or any of them shall
not be complied with, the Mortgagee shall be at liberty, but not obligated, to
effect and thereafter to replace, maintain and renew all such Insurances upon the
Vessels as it in its sole discretion may deem advisable;

(ii) in the event that the provisions of Section 5(C) and/or 5(D) hereof or any of
them shall not be complied with, the Mortgagee shall be at liberty, but not
obligated, to arrange for the carrying out of such repairs and/or surveys as it
deems expedient or necessary; and

(iii) in the event that the provisions of Section 5(F) hereof or any of them shall
not be complied with, the Mortgagee shall be at liberty, but not obligated, to pay
and discharge all such debts, damages and liabilities as are therein mentioned
and/or to take any such measures as it deems expedient or necessary for the purpose
of securing the release of the Vessels;

     Any and all expenses incurred by the Mortgagee (including fees of counsel) in
respect of its performances under the foregoing subsections (i), (ii)
and (iii) shall be paid by the Owner on demand, with interest thereon at the rate
provided for in Section 5(P) hereof from the date when such expenses were incurred
by the Mortgagee.

          7. Events of Default and Remedies.

          (A) In case any one or more of the following events herein termed an “Event of Default” shall
occur and shall not have been received:

14

 

(i) a default in the payment when due of all or any part of the Obligations;

(ii) an Event of Default stipulated in Section 8.1 of the Credit Agreement shall
occur and be continuing;

(iii) a default by the Owner occurs in the due and punctual observance of any of
the covenants contained in subsections (B) (other than subclauses (iii)(a), (iv),
(vi) and (xi) thereof), (F), (G), (I), (K), (L), (M), (N), (O), (Q), (R), (S), or
(T) of Section 5 of this Mortgage; or

(iv) a default by the Owner occurs in the due and punctual observance of any of the
covenants contained in subsections (A), (C), (D), (E), (H), (J), or (P) or
subclauses (iii)(a), (iv), (vi) or (xi) of subsection (B) of Section 5 of this
Mortgage and such default continues unremedied for a period of thirty (30) days; or

(v) it becomes impossible or unlawful for the Owner to fulfill any of the covenants
and obligations contained in this Mortgage and the Mortgagee considers that such
impossibility or illegality will have a material adverse effect on its rights under
this Mortgage or the enforcement thereof.

(B) If any Event of Default shall occur, the Mortgagee shall be entitled:

(i) to demand payment by written notice of the Obligations, whereupon such payment
shall be immediately due and payable, anything contained in the Credit Agreement,
the Note, this Mortgage or any of the other Security Documents to the contrary
notwithstanding and without prejudice to any other rights and remedies of the
Mortgagee under the Credit Agreement, the Note, this Mortgage or any of the other
Security Documents, provided, however, that if, before any sale of any Vessel, all
defaults shall have been remedied in a manner satisfactory to the Mortgagee, the
Mortgagee may waive such defaults by written notice to the Owner; but no such waiver
shall extend to or affect any subsequent or other default or impair any rights and
remedies consequent thereon;

(ii) at any time and as often as may be necessary to take any such action as the
Mortgagee may in its discretion deem advisable for the purpose of protecting the
security created by this Mortgage and each and every expense or liability (including
reasonable fees of counsel) so incurred by the Mortgagee in or about
the protection of such security shall be repayable to it by the Owner promptly after
demand, together with interest thereon at the Default Rate from the date when such
expense or liability was incurred by the Mortgagee. The Owner shall promptly
execute and deliver to the Mortgagee such documents or cause promptly to be executed
and delivered to the Mortgagee such documents, if any, and shall promptly do and
perform such acts, if any, as in the opinion of the Mortgagee or its counsel may be
necessary or advisable to facilitate or expedite the protection, maintenance and
enforcement of the security created by this Mortgage;

15

 

(iii) to exercise all the rights and remedies in foreclosure and otherwise given
to the Mortgagee by any applicable law, including those under the provisions of the
Ship Mortgage Act;

(iv) to take possession of any Vessel, wherever the same may be, without prior
demand and without legal process (when permissible under applicable law) and cause
the Owner or other person in possession thereof forthwith upon demand of the
Mortgagee to surrender to the Mortgagee possession thereof as demanded by the
Mortgagee;

(v) to require that all policies, contracts and other records relating to the
Insurances (including details of and correspondence concerning outstanding claims)
be forthwith delivered to such adjusters, brokers or other insurers as the Mortgagee
may nominate;

(vi) to collect, recover, compromise and give a good discharge for all claims then
outstanding or thereafter arising under the Insurances or any of them and to take
over or institute (if necessary using the name of the Owner) all such proceedings in
connection therewith as the Mortgagee in its absolute discretion deems advisable and
to permit the brokers through whom collection or recovery is effected to charge the
usual brokerage therefor;

(vii) to discharge, compound, release or compromise claims against the Owner in
respect of any Vessel which have given or may give rise to any charge or lien
thereon or which are or may be enforceable by proceedings thereagainst;

(viii) to take appropriate judicial proceedings for the foreclosure of this
Mortgage and/or for the enforcement of the Mortgagee’s rights hereunder or
otherwise; recover judgment for any amount due in respect of the Credit Agreement,
the Note, this Mortgage or any of the other Security Documents and collect the same
out of any property of the Owner;

(ix) to sell any Vessel at public auction, free from any claim of or by the Owner
of any nature whatsoever by first giving notice of the time and place of sale with a
general description of the property in the following manner:

	 	(a)	 	by publishing such notice for ten (10) consecutive days in a
daily newspaper of general circulation published in New York City;
	 
	 	(b)	 	if the place of sale should not be New York City, then also by
publication of a similar notice in a daily newspaper, if any, published at the
place of sale; and

16

 

	 	(c)	 	by sending a similar notice by telecopy confirmed by registered
mail to the Owner at its address hereinafter set forth at least fourteen (14)
days prior to the date of sale.
	 
	 	 	 	Such sale of any Vessel may be held at such place as the Mortgagee in such
notices may have specified, or such sale may be adjourned by the Mortgagee
from time to time by announcement at the time and place appointed for such
sale or for such adjourned sale and without further notice or publication the
Mortgagee may make such sale at the time and place to which the same shall be
so adjourned; and such sale may be conducted without bringing such Vessel to
the place designated for such sale and in such manner as the Mortgagee may
deem to be for its best advantage, and the Mortgagee may become the purchaser
at such sale.

(x) pending sale of any Vessel (either directly or indirectly) to manage, charter,
lease, insure, maintain and repair such Vessel and to employ or lay up such Vessel
upon such terms, in such manner and for such period as the Mortgagee in its absolute
discretion deems expedient and for the purpose aforesaid the Mortgagee shall be
entitled to do all acts and things incidental or conducive thereto and in particular
to enter into such arrangements respecting such Vessel, her insurance, management,
maintenance, repair, classification and employment in all respects as if the
Mortgagee were the owner of such Vessel and without being responsible for any loss
thereby incurred;

(xi) to recover from the Owner on demand any such losses as may be incurred by the
Mortgagee in or about the exercise of the powers vested in the Mortgagee under
Section 7(B)(x) above with interest thereon at the Default Rate from the date when
such losses were incurred by the Mortgagee; and

(xii) to recover from the Owner on demand all expenses, payments and disbursements
(including fees and expenses of counsel) incurred by the Mortgagee in or about or
incidental to the exercise by it of any of the powers vested in it hereunder
together with interest thereon at the Default Rate from the date when such expenses,
payments or disbursements were incurred by it;

PROVIDED, ALWAYS, that any sale of any Vessel or any interest therein by the Mortgagee pursuant to
Section 7(B)(ix) above shall operate to divest all right, title and interest of the Owner, its
successors and assigns, in or to such Vessel so sold and upon such sale the purchaser shall not be
bound to see or inquire whether the Mortgagee’s power of sale has arisen in the manner herein
provided and the sale shall be deemed to be within the power of the Mortgagee and the receipt of
the Mortgagee for the purchase money shall effectively discharge the purchaser who shall not be
concerned with the manner of application of the proceeds of sale or be in any way answerable
therefor.

In case the Mortgagee shall have proceeded to enforce any right, power or remedy under this
Mortgage by foreclosure, entry or otherwise, and such proceedings shall have been discontinued

17

 

or abandoned for any reason or shall have been determined adversely to the Mortgagee, then and in
every such case the Owner and the Mortgagee shall be restored to their former positions and rights
hereunder with respect to the property, subject or intended to be subject to this Mortgage, and all
rights, remedies and powers of the Mortgagee shall continue as if no such proceedings had been
taken.

          (C) Notwithstanding the foregoing, it is understood that a Total Loss of each Vessel which is
covered by the insurance maintained by Owner pursuant to Section 5(B) hereof shall not be deemed to
be a default under this Mortgage, the Credit Agreement, the Note, the other Security Documents, or
any of them.

          8. Application of Proceeds. The proceeds of any sale made either under the power of
sale hereby granted to the Mortgagee or under a judgment or decree in any judicial proceedings for
the foreclosure of this Mortgage or for the enforcement of any remedy granted to the Mortgagee
hereunder, any net earnings arising from the management, charter or other use of any Vessel by the
Mortgagee under any of the powers herein contained or by law provided and the proceeds of any and
all Insurances and any claims for damages on account of such Vessel or the Owner of any nature
whatsoever and any Requisition Compensation, shall be applied as follows:

	 	 	 
	          First:
	 	To the payment of all costs and expenses (together with interest
thereon as hereinbefore provided) incurred by the Mortgagee, the
Agent and/or the Lenders, including the reasonable compensation of
their respective agents and attorneys, by reason of any sale,
retaking, management or operation of the Vessels and all other
sums payable to the Mortgagee, the Agent and/or the Lenders
hereunder by reason of any expenses or liabilities incurred or
advances made by it for the protection, maintenance and
enforcement of the security or of any of its rights hereunder or
in the pursuit of any remedy hereby conferred; and at the option
of the Mortgagee to the payment of all taxes, assessments or liens
claiming priority over the lien of this Mortgage;
	 
	 	 
	          Second:

	 	To the payment of the Obligations in the manner provided in the
Credit Agreement; and
	 
	 	 
	          Third:

	 	Any surplus thereafter remaining, to the Owner or to the Owner’s
successors in interest or assigns, or to whomsoever may be
lawfully entitled to receive the same.

In the event that the proceeds are insufficient to pay the amounts specified in paragraphs “First”
and “Second” above, the Mortgagee shall be entitled to collect the balance from the Owner or any
other person liable therefor.

          9. No Waiver. No delay or omission of the Mortgagee to exercise any right or power
vested in it under the Credit Agreement, the Note, this Mortgage, the other Security

18

 

Documents or
any of them shall impair such right or power or be construed as a waiver thereof or as acquiescence
in any default by the Owner hereunder, nor shall the acceptance by the Mortgagee of any payments in
connection with this Mortgage from any source be deemed a waiver hereunder. However, if at any
time after an Event of Default and prior to the actual sale of the Vessels by the Mortgagee or
prior to any foreclosure proceedings the Owner cures all Events of Default and pays all expenses,
advances and damages to the Mortgagee consequent on such Events of Default, with interest at the
Default Rate from the date when such expenses, advances and damages were incurred, then the
Mortgagee may accept such cure and payment and restore the Owner to its former position, but such
action shall not affect any subsequent Event of Default or impair any rights consequent thereon.

          10. Delegation of Power. The Mortgagee shall be entitled at any time and as often as
may be expedient to delegate all or any of the powers and discretions vested in it by this Mortgage
(including the power vested in it by virtue of Section 12 hereof) in such manner and upon such
terms and to such persons as the Mortgagee in its absolute discretion may deem advisable.

          11. Indemnity. Without prejudice to any other rights and remedies of the Mortgagee
under the Credit Agreement, the Note, this Mortgage or any of the other Security Documents, the
Owner hereby agrees and undertakes, absent the willfull misconduct or gross negligence of the
Morgagee, to indemnify the Mortgagee against all obligations and liabilities whatsoever and
whensoever arising which the Mortgagee may incur in good faith in respect of, in relation to or in
connection with the Vessels or otherwise howsoever in relation to or in connection with the
enforcement of the Mortgagee’s rights hereunder or under any of the other Security Documents to
which the Owner is a party.

          12. Power of Attorney.

          (A) The Owner hereby irrevocably appoints the Mortgagee as its attorney-in-fact for the
duration of the Security Period to do in its name or in the name of the Owner all acts which the
Owner, or its successors or assigns, could do in relation to the Vessels, including without
limitation, to demand, collect, receive, compromise, settle and sue for (insofar as the Mortgagee
lawfully may) all freights, hire, earnings, issues, revenues, income and profits of the Vessels,
and all amounts due from underwriters under the Insurances as payment of losses or as return
premiums or otherwise, salvage awards and recoveries, recoveries in general average or otherwise,
and all other sums due or to become due to the Owner or in respect of the Vessels, and to make,
give and execute in the name of the Owner, acquittance, receipts, releases or other discharges for
the same, whether under seal or otherwise, to take possession of, sell or otherwise dispose of or
manage or employ, the Vessels, to execute and deliver charters and a bill of sale
with respect to the Vessels, and to endorse and accept in the name of the Owner all checks, notes,
drafts, warrants, agreements and all other instruments in writing with respect to the foregoing.
PROVIDED, HOWEVER, that, unless the context otherwise permits under this Mortgage, such power shall
not be exercisable by or on behalf of the Mortgagee unless and until any Event of Default shall
occur and shall not be exercisable after all defaults have been cured.

19

 

          (B) The exercise of the power granted in this Section 12 by or on behalf of the Mortgagee
shall not require any person dealing with the Mortgagee to conduct any inquiry as to whether any
such Event of Default has occurred and is continuing, nor shall such person be in any way affected
by notice that any such Event of Default has not occurred nor is continuing, and the exercise by
the Mortgagee of such power shall be conclusive evidence of its right to exercise the same.

          13. Appointment of Receiver. If any legal proceedings shall be taken to enforce any
right under this Mortgage, the Mortgagee shall be entitled as a matter of right to the appointment
of a receiver of the Vessels and of the freights, hire, earnings, issues, revenues, income and
profits due or to become due and arising from the operation thereof.

          14. Commencement of Proceedings. The Mortgagee shall have the right to commence
proceedings in the courts of any country having competent jurisdiction and in particular the
Mortgagee shall have the right to arrest and take action against any Vessel at whatever place such
Vessel shall be found lying and for the purpose of any action which the Mortgagee may bring before
the local court for the jurisdiction of such court or other judicial authority and the Owner agrees
that for the purpose of proceedings against such Vessel any writ, notice, judgment or other legal
process or documents may be served upon the Master of the Vessel (or upon anyone acting as the
Master) and that such service shall be deemed good service on the Owner for all purposes.

          15. Partial Invalidity. In the event that any provision or provisions of this
Mortgage shall be declared invalid, void or otherwise inoperative by any present or future court of
competent jurisdiction in any country, the Owner will, without prejudice to any other right and
remedy of the Mortgagee under the Credit Agreement, the Note, this Mortgage, the other Security
Documents or any of them, execute and deliver such other and further instruments and do such things
as in the opinion of the Mortgagee or its counsel will be necessary or advisable to carry out the
true intent and spirit of this Mortgage. In any event, any such declaration of partial invalidity
shall not affect the validity of any other provision or provisions of this Mortgage, or the
validity of this Mortgage as a whole.

          16. Cumulative Remedies. Each and every power and remedy in this Mortgage
specifically given to the Mortgagee shall be in addition to every other power and remedy herein or
in the Credit Agreement, the Note or the other Security Documents specifically given or now or
hereafter existing at law, in equity, admiralty, or by statute, and each and every power and remedy
whether specifically in this Mortgage or in the Credit Agreement, the Note or the other Security
Documents given or otherwise existing may be exercised from time to time and as often and in such
order as may be deemed expedient by the Mortgagee, and the exercise or the beginning of the
exercise of any such power or remedy shall not be construed to be a waiver of
the right to exercise at the same time or thereafter any other power or remedy under the Credit
Agreement, the Note, this Mortgage or any other Security Documents.

          17. Recordation of Mortgage. For the purpose of recording this First Preferred
Mortgage the total amount is One Hundred Ninety-Five Million Five Hundred Thousand Dollars (U.S.
$195,500,000) (exclusive of interest, expenses and fees) of which $170,000,000 comprises

20

 

the Loan and $25,500,000 comprises the Swap Liabilities and interest and performance of mortgage covenants.
The discharge amount is the same as the total amount and there is no separate discharge amount for
the Vessels. It is not intended that this Mortgage shall include property other than the Vessels
and it shall not include property other than the Vessels as the term “vessel” is used in Subsection
(c)(2) of Section 31322 of Title 46 United States Code, as amended. Notwithstanding the foregoing,
for property other than the Vessels, if any should be determined to be covered by this Mortgage,
the discharge amount is zero point zero one percent (0.01%) of the total amount.

          18. No Waiver of Preferred Status. Anything herein to the contrary notwithstanding,
it is intended that nothing herein shall waive the preferred status of this Mortgage under the Ship
Mortgage Act or under the corresponding provisions of any other jurisdiction in which it is sought
to be enforced and that, if any provision or portion thereof herein shall be construed to waive the
preferred status of this Mortgage, then such provision to such extent shall be void and of no
effect.

          19. Counterparts. This Mortgage may be executed in any number of counterparts each
of which shall be an original but such counterparts shall together constitute but one and the same
instrument.

          20. Notices. Notices and other communications under this Mortgage shall be in
writing and may be given by telecopy as follows:

	 	 	 
	If to the Owner -

	 	Rigdon Marine Corporation

815 Walker Street, Suite 750

Houston, Texas 77002

United States of America

Attention: Larry T. Rigdon

Fax No. (703) 236-0200
	 
	 	 
	With Copy to -

	 	Lugenbuhl, Burke, Wheaton, Peck, Rankin & Hubbard

601 Poydras Street, Suite 2775

New Orleans, LA 70130

United States of America

Facsimile: (504)529-7418

Attention: Stewart F. Peck
	 
	 	 
	If to the Mortgagee -

	 	DVB Bank NV

Parklaan 2

3016 BB Rotterdam

The Netherlands

Attention: Peter Bergman/Loan Administrator

Fax No. +31 10 436 2957

21

 

or to such other address as either party shall from time to time specify in writing to the other.
Any notice sent by telecopy shall be confirmed by letter dispatched as soon as practicable
thereafter.

          Every notice or other communication shall, except so far as otherwise expressly provided by
this Mortgage, be deemed to have been received (provided that it is received prior to 10 a.m. New
York time; otherwise it shall be deemed to have been received on the next following Banking Day ),
in the case of a telecopy at the time of dispatch thereof (provided further that if the date of
dispatch is not a Banking Day in the locality of the party to whom such notice or demand is sent it
shall be deemed to have been received on the next following Banking Day in such locality), and in
the case of a letter, at the time of receipt thereof.

          21. Rights of Owner. Unless one or more Events of Default shall have occurred and be
continuing, the Owner (a) shall be suffered and permitted to retain actual possession and use of
the Vessels and (b) shall have the right, from time to time in its discretion, and without
application to the Mortgagee, and without obtaining a release thereof by the Mortgagee, to dispose
of, free from the lien hereof, any boilers, engines, machinery, masts, spars, sails, rigging,
boats, anchors, cables, chains, tackle, apparel, furniture, fittings, equipment or any other
appurtenances of the Vessels that are no longer useful, necessary, profitable or advantageous in
the operation of the Vessels, first or simultaneously replacing the same by new boilers, engines,
machinery, masts, spars, sails, rigging, boats, anchors, cables, chains, tackle, apparel,
furniture, fittings, equipment or any other appurtenances of substantially equal value to the
Owner, which shall forthwith become subject to the lien of this Mortgage.

          22. Waiver; Amendment. None of the terms and conditions of this Mortgage may be
changed, waived, modified or varied in any manner whatsoever unless in writing duly signed by the
Owner and the Mortgagee.

          23. Successors and Assigns. All the covenants, promises, stipulations and agreements
of the Owner and all the rights and remedies of the Mortgagee contained in this Mortgage shall bind
the Owner, its successors and assigns, and shall inure to the benefit of the Mortgagee, its
successors and assigns, whether so expressed or not.

          24. Applicable Law. This Agreement shall be governed by, and construed in accordance
with, the laws of the United States of America.

          25. Headings. In this Mortgage, section headings are inserted for convenience of
reference only and shall be ignored in the interpretation of this Mortgage.

22

 

          IN WITNESS WHEREOF, the Owner has executed this Mortgage by its duly authorized representative
on the day and year first above written.

	 	 	 	 	 
	 	RIGDON MARINE CORPORATION

 	 
	 	By:  	 /s/ Larry T. Rigdon	 
	 	 	Name:  	Larry T. Rigdon 	 
	 	 	Title:  	Chairman 	 

23

 

	 	 	 	 	 

Schedule 1

Vessels

	 	 	 	 	 	 	 
	Vessel Name	 	Official Number	 	Registry/Flag
	ORLEANS

	 	 	1151394	 	 	United States
	BOURBON

	 	 	1156133	 	 	United States
	ROYAL

	 	 	1159200	 	 	United States
	CHARTRES

	 	 	1160318	 	 	United States
	IBERVILLE

	 	 	1163367	 	 	United States
	BIENVILLE

	 	 	1163970	 	 	United States
	CONTI

	 	 	1166313	 	 	United States
	ST. LOUIS

	 	 	1167668	 	 	United States
	TOULOUSE

	 	 	1169977	 	 	United States
	ESPLANADE

	 	 	1173548	 	 	United States

25

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00145-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00145-of-00352.parquet"}]]