Document:

Exhibit 4.5

SECOND SUPPLEMENTAL INDENTURE

ADDITIONAL
SUBSIDIARY GUARANTEES

SECOND
SUPPLEMENTAL INDENTURE (this “Supplemental Indenture”),
dated as of February 9,, 2007 among Britannia Bulk Plc, a public limited
company incorporated under the laws of England and Wales (the “Company”), the existing guarantors listed on the signature
pages hereto (the “Existing Guarantors”), the new guarantors listed on the signature
pages hereto (the “New Guarantors”
and, collectively, with the Existing Guarantors, the “Guarantors”),
and Wilmington Trust Company, a Delaware banking corporation, as trustee under
the Indenture referred to below (the “Trustee”).  Capitalized terms used herein and not defined
herein shall have the meaning ascribed to them in the Indenture (as defined
below).

W I T N E S S E T H

WHEREAS, the Company has heretofore
executed and delivered to the Trustee an Indenture (as amended, supplemented
and in effect, the “Indenture”),
dated as of November 16, 2006, providing for the issuance of its 11%
Senior Secured Notes due 2011;

WHEREAS, Article XI of the Indenture
provides that under certain circumstances the Company may or must cause certain
of its Subsidiaries to execute and deliver to the Trustee a supplemental
indenture pursuant to which such Subsidiaries shall unconditionally guarantee
all of the Company’s Obligations under the Notes pursuant to a Subsidiary
Guarantee on the terms and conditions set forth herein; and

WHEREAS, pursuant to Section 9.01
of the Indenture, the Trustee is authorized to execute and deliver this
Supplemental Indenture.

NOW THEREFORE, in consideration of the
foregoing and for other good and valuable consideration, the receipt of which
is hereby acknowledged, the Company, the New Guarantors and the Trustee
mutually covenant and agree for the equal and ratable benefit of the Holders of
the Notes as follows:

1.             Capitalized
Terms.  Capitalized terms used herein
without definition shall have the meanings assigned to them in the Indenture.

2.             Agreement
to Guarantee.  The New Guarantors hereby
agree, jointly and severally with all other Guarantors, to unconditionally
guarantee the Company’s obligations under the Notes and the Indenture on the
terms and subject to the conditions set forth in Article XI of the Indenture
and to be bound by all of the provisions of the Indenture applicable to a
Guarantor thereunder and to perform all of the obligations and agreements of a
Guarantor under the Indenture.

3.             No
Recourse Against Others.  No past,
present or future director, officer, employee, manager, incorporator, partner,
member, agent, shareholder or other owner of Capital Stock of any Guarantor, as
such, shall have any liability for any obligations of the Company or any
Guarantor under the Notes, any Subsidiary Guarantees, the Indenture or this Supplemental
Indenture or for any claim based on, in respect of, or by reason of, such
obligations or their creation.  Each
Holder by accepting a Note waives and releases all such liability.  The waiver and release are part of the
consideration for issuance of the Notes.

4.             NEW
YORK LAW TO GOVERN.  THE INTERNAL LAW OF
THE STATE OF NEW YORK SHALL GOVERN AND BE USED TO CONSTRUE THIS SUPPLEMENTAL
INDENTURE.

5.             Severability
Clause.  In case any provision of this
Supplemental Indenture shall be invalid, illegal or unenforceable, the
validity, legality and enforceability of the remaining provisions shall not in
any way be affected or impaired thereby and such provision shall be ineffective
only to the extent of such invalidity, illegality or unenforceability.

6.             Ratification
of Indenture; Supplemental Indentures Part of Indenture.  Except as expressly amended hereby, the
Indenture is in all respects ratified and confirmed and all the terms,
conditions and provisions thereof shall remain in full force and effect.  This Supplemental Indenture shall form a part
of the Indenture for all purposes, and every Holder of the Notes heretofore or
hereafter authenticated and delivered shall be bound hereby.

7.             Counterparts.  The parties may sign any number of copies of
this Supplemental Indenture.  Each signed
copy shall be an original, but all of them together represent the same
agreement.

8.             Effect
of Headings.  The Section headings
herein are for convenience only and shall not affect the construction hereof.

9.             The
Trustee.  The Trustee shall not be
responsible in any manner whatsoever for or in respect of the validity or
sufficiency of this Supplemental Indenture or for or in respect of the
correctness of the recitals of fact contained herein, all of which recitals are
made solely by the New Guarantors.

IN WITNESS WHEREOF, the parties hereto
have caused this Supplemental Indenture to be duly executed and delivered, all
as of the date first above written.

	
  BRITANNIA BULK PLC

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ C.J. Hanson

  	
   

  
	
  Name:

  	
  C.J. Hanson

  	
   

  
	
  Title:

  	
  Managing
  Director

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  WILMINGTON
  TRUST COMPANY, as Trustee

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ Denise M. Geran

  	
   

  
	
  Name:

  	
  Denise M. Geran

  	
   

  
	
  Title:

  	
  Vice President

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  Existing
  Guarantors:

  	
   

  
	
   

  	
   

  
	
  GREAT
  BELT SHIPPING COMPANY, S.A.

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ Serguei
  Zoudov

  	
   

  
	
  Name:

  	
  Serguei Zoudov

  	
   

  
	
  Title:

  	
  Director

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  FLAGSHIP
  MARITIME, S.A.

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ David Znak

  	
   

  
	
  Name:

  	
  David Znak

  	
   

  
	
  Title:

  	
  Director

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  BALTIC
  NAVIGATION CO., S.A.

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ Serguei
  Zoudov

  	
   

  
	
  Name:

  	
  Serguei Zoudov

  	
   

  
	
  Title:

  	
  Director

  	
   

  

 

 

	
  NORTHERN STAR NAVIGATION, S.A.

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ David Znak

  	
   

  
	
  Name:

  	
  David Znak

  	
   

  
	
  Title:

  	
  Director

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  BRITANNIA
  BULK, S.A.

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ Serguei
  Zoudov

  	
   

  
	
  Name:

  	
  Serguei Zoudov

  	
   

  
	
  Title:

  	
  Director

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  BBL
  DENMARK HOLDING A/S

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ C.J. Hanson

  	
   

  
	
  Name:

  	
  C.J. Hanson

  	
   

  
	
  Title:

  	
  Authorized
  Signatory

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  DANMAR
  SHIPPING, S.A.

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ C.J. Hanson

  	
   

  
	
  Name:

  	
  C.J. Hanson

  	
   

  
	
  Title:

  	
  Director

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  BRITANNIA
  BULKERS PLC

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ David Znak

  	
   

  
	
  Name:

  	
  David Znak

  	
   

  
	
  Title:

  	
  Director

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  SVENDBORG
  SHIP MANAGEMENT A/S

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ C.J. Hanson

  	
   

  
	
  Name:

  	
  C.J. Hanson

  	
   

  
	
  Title:

  	
  Authorized
  Signatory

  	
   

  

 

 

	
  BRITANNIA BULKER A/S

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ C.J. Hanson

  	
   

  
	
  Name:

  	
  C.J. Hanson

  	
   

  
	
  Title:

  	
  Authorized Signatory

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  SVENDBORG
  MARINE SURVEYORS A/S

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ C.J. Hanson

  	
   

  
	
  Name:

  	
  C.J. Hanson

  	
   

  
	
  Title:

  	
  Authorized
  Signatory

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  BRITANNIA
  BULK DK A/S

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ C.J. Hanson

  	
   

  
	
  Name:

  	
  C.J. Hanson

  	
   

  
	
  Title:

  	
  Authorized
  Signatory

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  INSPECCIONES
  MARITIMAS S.A.

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ C.J. Hanson

  	
   

  
	
  Name:

  	
  C.J. Hanson

  	
   

  
	
  Title:

  	
  Authorized
  Signatory

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  INTERNATIONAL
  BULK SERVICES S.A.

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ Serguei
  Zoudov

  	
   

  
	
  Name:

  	
  Serguei Zoudov

  	
   

  
	
  Title:

  	
  Director

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  ATLANTIC
  BULK SERVICES S.A.

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ Serguei
  Zoudov

  	
   

  
	
  Name:

  	
  Serguei Zoudov

  	
   

  
	
  Title:

  	
  Authorized
  Signatory

  	
   

  

 

 

	
  UNITY BULK SERVICES S.A.

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ Serguei
  Zoudov

  	
   

  
	
  Name:

  	
  Serguei Zoudov

  	
   

  
	
  Title:

  	
  Authorized
  Signatory

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  WESTERN
  BULK SERVICES S.A.

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ David Znak

  	
   

  
	
  Name:

  	
  David Znak

  	
   

  
	
  Title:

  	
  Director

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  CHANNEL
  BULK SERVICES S.A.

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ Serguei
  Zoudov

  	
   

  
	
  Name:

  	
  Serguei Zoudov

  	
   

  
	
  Title:

  	
  Authorized
  Signatory

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  New
  Guarantors:

  	
   

  
	
   

  	
   

  
	
  NAVIGATOR
  BULK SERVICES S.A.

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ C.J. Hanson

  	
   

  
	
  Name:

  	
  C.J. Hanson

  	
   

  
	
  Title:

  	
  DirectorExhibit 10.1

FIRST PREFERRED SHIP MORTGAGE

DATED AS
OF

November 16, 2006

MADE BY

[MORTGAGOR]

TABLE OF
CONTENTS

	
  

  	
   

  	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE I DEFINITIONS

  	
   

  	
  2

  
	
  Section 1.01

  	
   

  	
  Certain Defined Terms

  	
   

  	
  2

  
	
  Section 1.02

  	
   

  	
  Terms Generally; Rules of Construction

  	
   

  	
  4

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE II REPRESENTATIONS, WARRANTIES AND COVENANTS
  OF THE MORTGAGOR

  	
   

  	
  5

  
	
  Section 2.01

  	
   

  	
  Payment and Performance of Note Obligations

  	
   

  	
  5

  
	
  Section 2.02

  	
   

  	
  Organization

  	
   

  	
  5

  
	
  Section 2.03

  	
   

  	
  Ownership of Vessel, Warranty and Defense of Title

  	
   

  	
  5

  
	
  Section 2.04

  	
   

  	
  Compliance with Laws

  	
   

  	
  5

  
	
  Section 2.05

  	
   

  	
  Operation of Vessel

  	
   

  	
  6

  
	
  Section 2.06

  	
   

  	
  Claims, Taxes, Fees, Etc

  	
   

  	
  6

  
	
  Section 2.07

  	
   

  	
  Liens

  	
   

  	
  6

  
	
  Section 2.08

  	
   

  	
  Notice of Mortgage

  	
   

  	
  7

  
	
  Section 2.09

  	
   

  	
  Removal of Liens

  	
   

  	
  7

  
	
  Section 2.10

  	
   

  	
  Libel or Attachment

  	
   

  	
  7

  
	
  Section 2.11

  	
   

  	
  Maintenance of Vessel

  	
   

  	
  7

  
	
  Section 2.12

  	
   

  	
  Changes in Vessel

  	
   

  	
  8

  
	
  Section 2.13

  	
   

  	
  Inspection

  	
   

  	
  8

  
	
  Section 2.14

  	
   

  	
  Change of Flag or Documentation

  	
   

  	
  8

  
	
  Section 2.15

  	
   

  	
  Charter of Vessel

  	
   

  	
  9

  
	
  Section 2.16

  	
   

  	
  Requisition of Title or Use

  	
   

  	
  9

  
	
  Section 2.17

  	
   

  	
  Notice of Loss, Requisition or Damage

  	
   

  	
  9

  
	
  Section 2.18

  	
   

  	
  Insurance

  	
   

  	
  9

  
	
  Section 2.19

  	
   

  	
  Reimbursement of Mortgagee

  	
   

  	
  12

  
	
  Section 2.20

  	
   

  	
  Reports

  	
   

  	
  12

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE III MORTGAGE DEFAULTS AND MORTAGE EVENTS OF
  DEFAULT

  	
   

  	
  13

  
	
  Section 3.01

  	
   

  	
  Mortgage Defaults and Mortgage Events of Default

  	
   

  	
  13

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE IV REMEDIES; APPLICATION OF PROCEEDS

  	
   

  	
  13

  
	
  Section 4.01

  	
   

  	
  Sale, etc

  	
   

  	
  13

  
	
  Section 4.02

  	
   

  	
  Finality of Sale

  	
   

  	
  14

  
	
  Section 4.03

  	
   

  	
  Powers and Rights of Mortgagee upon Occurrence of a
  Mortgage Event of Default

  	
   

  	
  15

  
	
  Section 4.04

  	
   

  	
  Application of Proceeds

  	
   

  	
  16

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE V GENERAL POWERS OF MORTGAGEE

  	
   

  	
  16

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VI INDEMNITY

  	
   

  	
  17

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VII SUNDRY PROVISIONS

  	
   

  	
  17

  
	
  Section 7.01

  	
   

  	
  Cumulative Remedies; No Waiver

  	
   

  	
  17

  
	
  Section 7.02

  	
   

  	
  Further Assurances

  	
   

  	
  17

  

 

 i
 

 

	
  Section 7.03

  	
   

  	
  No Waiver of Preferred Status

  	
   

  	
  1818

  
	
  Section 7.04

  	
   

  	
  Survival of Agreements

  	
   

  	
  1818

  
	
  Section 7.05

  	
   

  	
  Notices

  	
   

  	
  1818

  
	
  Section 7.06

  	
   

  	
  Counterparts; Amendments

  	
   

  	
  1818

  
	
  Section 7.07

  	
   

  	
  Nature of Agreements Hereunder

  	
   

  	
  1818

  
	
  Section 7.08

  	
   

  	
  Recording

  	
   

  	
  1818

  
	
  Section 7.09

  	
   

  	
  Construction

  	
   

  	
  1818

  
	
  Section 7.10

  	
   

  	
  Governing Law

  	
   

  	
  1918

  
	
  Section 7.11

  	
   

  	
  Power of Attorney for Registration

  	
   

  	
  1919

  

 

SCHEDULE:

I                                            Vessel

II                                        Information
for the Purposes of Article 1515 of the Panamanian Commercial Code

 ii

THIS FIRST PREFERRED SHIP MORTGAGE, dated as of
November 16, 2006 (as amended, modified, supplemented, renewed, restated or
replaced, in whole or part, from time to time, this “Mortgage”),
is made and given by [MORTGAGOR], a Panamanian company duly organized and
existing under the laws of the Republic of Panama, with an address at c/o Vives
y Asociados, Edificio Banco Aliado, Octavo Piso, Calle Beatrix M. de Cabal,
Guidad Panama, Panama 5, Republic of Panama (the “Mortgagor”),
to and in favor of WILMINGTON TRUST COMPANY, a Delaware banking corporation, in
its capacity as Trustee under the Indenture referred to below, with an office
at Rodney Square North, 1100 N. Market Street, Wilmington, Delaware 19890
U.S.A. (acting in such capacity, together with its successors and assigns in
such capacity the “Trustee” or the “Mortgagee”).

RECITALS

A.                                   The
Mortgagor is the sole owner of the whole of the vessel set forth on Schedule I
attached hereto and made a part hereof (hereinafter called the “Vessel”), duly documented in the
name of the Mortgagor under the laws of the Republic of Panama.

B.                                     The
information required as to this Mortgage for the purposes of Article 1515 of
the Panamanian Commercial Code is set forth on Schedule II attached hereto and
made a part hereof.

C.                                     Britannia
Bulk plc, a company registered in England and Wales (the “Company”),
as issuer, and the Mortgagee, as the Trustee for the benefit of the holders of
the Notes (as such term is hereinafter defined), are parties to that certain
Indenture dated as of November 16, 2006 (said Indenture, as amended, modified,
supplemented, renewed, restated or replaced, in whole or part, from time to
time, being herein called the “Indenture”),
pursuant to which the Company will issue notes in an aggregate principal sum of
US$185,000,000 (One Hundred Eighty-Five Million United States Dollars]) (as
amended, modified, supplemented, renewed, restated or replaced, in whole or
part, from time to time, the “Notes”).

D.                                    The
Mortgagor is a wholly-owned subsidiary of the Company.  Accordingly, the Mortgagor and the Company
share common interest as members of a group of companies that will derive
substantial direct and indirect economic and other benefits from the issuance
of the Notes under the Indenture.

E.                                      The
Mortgagor has agreed to execute and deliver to the Mortgagee on behalf of the
holders of the Notes this Mortgage in order to secure the payment in full of
the Notes and other Note Obligations (as such term is hereinafter defined), and
the total amount of the Mortgage is as set forth in Section 7.08 hereof.

AGREEMENT

In consideration of the foregoing premises and of
other good and valuable consideration, the receipt and adequacy of which is
hereby acknowledged, and in order to secure the payment and performance of all
Note Obligations (as such term is hereinafter defined), the Mortgagor has
granted, conveyed, mortgaged, pledged, assigned,

transferred, set over and
confirmed and by these presents does grant, convey, mortgage, pledge, assign,
transfer, set over and confirm unto the Mortgagee, its successors and assigns,
the whole of the Vessel, together with all of the boilers, engines, generators,
air compressors, cranes, machinery, masts, spars, rigging, boats, anchors,
cables, chains, tackle, tools, pumps and pumping equipment, apparel, furniture,
fittings and equipment, spare parts, and all other appurtenances thereunto
appertaining or belonging, whether now owned or hereafter acquired, whether on
board or not, and all additions, improvements, renewals and replacements hereafter
made in or to the Vessel, or any part thereof, or in or to said appurtenances,
all of which property shall be deemed to be included in the term “Vessel” as used in this Mortgage,
provided that, notwithstanding anything to the contrary herein, the term “Vessel”
shall not include Excluded Accounts (as such term is hereinafter defined);

TO HAVE AND TO HOLD all and singular the above
mortgaged and described property unto the Mortgagee, its successors and assigns
forever upon the terms herein set forth;

PROVIDED, HOWEVER, and these presents are on the
condition that, if the Mortgagor, its successors or assigns shall pay and
perform each and every one of the Note Obligations in accordance with the terms
of the Notes and any other document or instrument evidencing any Note
Obligation, then these presents and the estate and rights hereunder shall
cease, terminate and be void, otherwise to be and remain in full force and
effect.

ARTICLE I

DEFINITIONS

Section 1.01                                Certain
Defined Terms.

As used in this Mortgage, the following terms have the
meanings specified below:

“Affiliate”
of any specified Person means:

(1)                                  any
other Person, directly or indirectly, controlling or controlled by; or

(2)                                  under
direct or indirect common control with such specified Person.

For the purposes of this
definition, “control” when used with respect to any Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms “controlling” and “controlled” have meanings correlative to the
foregoing.

“Collateral”
means any other property or assets subject to Liens to secure any of the Note
Obligations pursuant to the provisions of the Security Documents.

“Company”
has the meaning assigned to such term in Recital C.

“dollars”
or “$” refers to lawful money of the
United States of America.

 2
 

“Excluded
Accounts” means any right to payment of a monetary obligation in
respect of the Vessel, whether or not earned by performance, (a) for services
to rendered or to be rendered; or (b) for the use or hire of the Vessel under a
charter or other contract the duration of which does not exceed one calendar
year (such charters or other contracts herein referred to collectively as “Short-Term Charters”).  For the avoidance of doubt, the following
shall not be treated as “Excluded Accounts”: 
rights to payment of a monetary obligation in respect of the Vessel,
whether or not earned by performance, (i) for the sale, lease, license,
assignment or other disposition of the Vessel, other than Short-Term Charters;
(ii) for the use or hire of the Vessel, other than Short-Term Charters; or
(iii) for a policy of insurance issued or to be issued relating to the Vessel.

“Indenture”
has the meaning assigned to such term in Recital C.

“Lien”
means any mortgage, pledge, security interest, encumbrance, lien or charge of
any kind (including any conditional sale or other title retention agreement or
lease in the nature thereof, a ship or vessel mortgage or encumbrance, any
option or other agreement to sell or give a security interest in any property).

“Mortgage”
has the meaning assigned to such term in the initial paragraph hereof.

“Mortgage
Default” has the meaning assigned to such term in Section 3.01
hereof.

“Mortgagee”
has the meaning assigned to such term in the initial paragraph hereof.

“Mortgage
Event of Default” has the meaning assigned to such term in
Section 3.01 hereof.

“Mortgagor”
has the meaning assigned to such term in the initial paragraph hereof.

“Note
Documents” means, collectively, the Notes, the Indenture, and
the Security Documents.

“Note
Obligations” means (a) all principal, interest, premium, fees,
reimbursements, indemnifications, and other amounts now or hereafter owed by
any Obligor under the Note Documents; (b) all amounts now or hereafter owed by
the Mortgagor under this Mortgage and the other Security Documents; and (c) any
increases, extensions, renewals, replacements, and rearrangements of the
foregoing obligations under any amendments, supplements, and other
modifications of the agreements creating the foregoing obligations, in each
case, whether direct or indirect, absolute or contingent.

“Notes”
has the meaning assigned to such term in Recital C.

“Obligor”
means each of the Company, the Mortgagor, any Person that now is or hereafter
becomes a guarantor of the Notes, and any other Person that has granted a Lien
upon any of such Person’s property as security for the Note Obligations.

 3
 

“Permitted
Collateral Liens” means Liens that, under the provisions of the
Indenture, are permitted to exist with respect to the Vessel.

“Permitted
Flag Jurisdiction” means the United Kingdom, the Isle of Man,
the Commonwealth of Bermuda, the British Virgin Islands, the Cayman Islands,
the United States of America, any State of the United States or the District of
Columbia, the Commonwealth of the Bahamas, the Republic of the Marshall
Islands, the Republic of Liberia, the Republic of Panama, Singapore, Cyprus,
the Philippines, Denmark, Norway, Greece, Malta, India, and any other
jurisdiction generally acceptable to institutional lenders in the shipping
industry, as determined in good faith by the Board of Directors of the Company
or any committee thereof duly authorized to act on behalf of such Board of
Directors.

“Person”
means any individual, corporation, partnership, limited liability company,
joint venture, association, joint stock company, trust, unincorporated
organization, government or any agency or political subdivision thereof or any
other entity.

“Security
Documents” means this Mortgage and any other security
agreements, pledge agreements, collateral assignments, mortgages, vessel
mortgages, marine mortgages, deeds of covenants, assignments of earnings and
insurances, share pledges, collateral agency agreements, intercreditor
agreements, deeds of trust or other grants or transfers for security executed
and delivered by the Mortgagor, the Company and/or any other Obligor creating,
or purporting to create, a Lien upon any Collateral in favor of the Trustee for
the benefit of the holders of the Notes, in each case as amended, modified,
supplemented, renewed, restated or replaced, in whole or part, from time to
time.

“TIA”
means the Trust Indenture Act of 1939 (15 U.S.C. §§ 77aaa-77bbbb), as amended,
as in effect on the date on which the Indenture is qualified under the TIA,
except as otherwise provided in Section 9.03 of the Indenture.

“Trustee”
has the meaning assigned to such term in the initial paragraph hereof.

“Vessel”
has the meaning assigned to such term in Recital A.

Section 1.02                                Terms
Generally; Rules of Construction.

The definitions of terms
herein shall apply equally to the singular and plural forms of the terms
defined.  Whenever the context may
require, any pronoun shall include the corresponding masculine, feminine and
neuter forms.  The words “include”, “includes”
and “including” shall be deemed to be followed by the phrase “without
limitation”.  The word “will” shall be
construed to have the same meaning and effect as the word “shall”.  Unless the context requires otherwise (a) any
definition of or reference to any agreement, instrument or other document
herein shall be construed as referring to such agreement, instrument or other
document as from time to time amended, supplemented or otherwise modified
(subject to any restrictions on such amendments, supplements or modifications
set forth in the Note Documents), (b) any reference herein to any law shall be
construed as referring to such law as amended, modified, codified or reenacted,
in whole or in part,

 4
 

and in effect from time
to time, (c) any reference herein to any Person shall be construed to include
such Person’s successors and assigns (subject to the restrictions contained in
the Note Documents), (d) the words “herein”, “hereof” and “hereunder”, and
words of similar import, shall be construed to refer to this Agreement in its
entirety and not to any particular provision hereof, (e) with respect to the
determination of any time period, the word “from” means “from and including”
and the word “to” means “to and including” and (f) any reference herein to
Sections, Annexes, Exhibits and Schedules shall be construed to refer to
Sections of, and Annexes, Exhibits and Schedules to, this Mortgage.  No provision of this Agreement or any other
Note Document shall be interpreted or construed against any Person solely
because such Person or its legal representative drafted such provision.

ARTICLE
II

REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE MORTGAGOR

In order to induce the Mortgagee and the holders of
the Notes to enter into the Indenture and to induce the holders of the Notes to
purchase their Notes thereunder, the Mortgagor represents and warrants to the
Mortgagee and the holders of the Notes and covenants with the Mortgagee and the
holders of the Notes that:

Section 2.01                                Payment
and Performance of Note Obligations.

The Mortgagor will pay, observe, perform and comply
with each and every one of the covenants, terms and conditions herein expressed
or implied (including, without limitation, the Note Obligations), on its part
to be paid, observed, performed, or complied with.

Section 2.02                                Organization.

The Mortgagor is a corporation organized and existing
under the laws of the Republic of Panama.

Section 2.03                                Ownership
of Vessel, Warranty and Defense of Title.

The Mortgagor lawfully owns and is lawfully possessed
of the Vessel free from any Lien whatsoever other than the lien of this
Mortgage and Permitted Collateral Liens and the Mortgagor will warrant and
defend the title to, and possession of the Vessel and every part thereof for
the benefit of the Mortgagee against the claims and demands of all Persons
whomsoever.

Section 2.04                                Compliance
with Laws.

(a)                                  Documentation.  The Mortgagor will comply with and satisfy
all provisions of the laws and regulations of the Republic of Panama now or
hereafter from time to time in effect in order that the Vessel shall continue
to be a documented vessel

 5
 

pursuant
to the laws of the Republic of Panama as a vessel of the Republic of Panama
under the flag of the Republic of Panama with such endorsements as shall
qualify the Vessel for participation in the coastwise trade and such other
trades and services to which they may be dedicated from time to time.

(b)                                 First
Preferred Ship Mortgage. 
The Mortgagor will, at its sole expense and at no cost to the Mortgagee,
comply with and satisfy all the provisions of the laws and regulations of the
Republic of Panama, in order to establish, record and maintain this Mortgage as
a First Preferred Ship Mortgage thereunder upon the Vessel, and will do all
such other acts and execute all such instruments, deeds, conveyances, mortgages
and assurances as the Mortgagee shall reasonably require in order to subject
the Vessel to the lien of this Mortgage as aforesaid.

(c)                                  Laws,
Treaties and Conventions. 
The Vessel shall, and the Mortgagor covenants that they will, at all
times comply with all applicable laws, treaties and conventions and rules and
regulations issued thereunder, and shall have on board as and when required
thereby valid certificates showing compliance therewith.

Section 2.05                                Operation
of Vessel.

The Mortgagor will not cause or permit the Vessel to
be operated in any manner contrary to applicable law or regulation, or in any
manner not permitted by the Indenture or by any insurances required thereby and
hereby, will not engage in any unlawful trade, violate any law or carry any
cargo that will expose the Vessel to penalty, forfeiture or capture and will
not do, or suffer or permit to be done, anything which can or may injuriously affect
the documentation of the Vessel under the laws and regulations of the Republic
of Panama.  Mortgagor shall keep the
operation of the Vessel within the permitted navigational limits set forth in
the trading warranties of the policies of insurance covering the Vessel and in
any case will not operate the Vessel, or permit the Vessel to be operated, in
any area where such insurance would not be fully applicable and enforceable
with respect to the Vessel and its operation.

Section 2.06                                Claims,
Taxes, Fees, Etc.

The Mortgagor will pay and discharge or cause to be
paid and discharged when due and payable from time to time, all claims against,
and fees, taxes, assessments, governmental charges, fines and penalties
(collectively “claims”) imposed on the
Vessel, its cargo or any income therefrom; provided, however, that Mortgagor
shall have the right to contest any such claims by appropriate proceedings
timely commenced and diligently prosecuted; provided, further, that Mortgagor
first provides adequate replacement security to cause the release of the Vessel
and provided that such contest otherwise poses no risk to the Collateral or
Mortgagee’s position in it.

Section 2.07                                Liens.

Neither the Mortgagor, any shipper or charterer, the
master of the Vessel nor any other Person who has or shall have any right,
power or authority to create, incur or permit to be placed or imposed or
continued upon the Vessel, its freights, profits or hires, any lien,

 6
 

security interest, encumbrance or charge whatsoever
other than Permitted Collateral Liens. 
Mortgagor agrees to hold a certified copy of this Mortgage in
safekeeping and with the Vessel’s papers on board the Vessel, if the Vessel is
self-propelled, and in the principal office of Mortgagor if the Vessel is not
self propelled, on demand to exhibit the same to any person having business
with the Vessel, or to any representative of Mortgagee.  Mortgagor shall also place and cause to be
displayed in a prominent place and in a durable manner a notice printed in
plain type 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 FIRST PREFERRED SHIP MORTGAGE AND OWNERSHIP”

“This Vessel is owned by [Mortgagor] and is covered by
a first preferred ship mortgage in favor of Wilmington Trust Company, as
Trustee and Mortgagee on behalf of the holders of the Notes.  Under the terms of said first preferred ship
mortgage, neither Owner, any charterer nor any subcharterer nor the master of
this Vessel nor any other person has the right, power or authority to create,
incur or permit to be placed or imposed upon this Vessel, or upon title thereto
or any interest therein any lien whatsoever other than liens for current wages
of the crew (including the master) of this Vessel, or for general average or
salvage.”

Such notice shall be amended at the sole cost and
expense of Mortgagor, upon request of Mortgagee, to reflect the identity of any
successor Mortgagee.

Section 2.08                                Notice
of Mortgage.

The Mortgagor shall exhibit and shall require that any
other person having custody or control of the Vessel exhibit a copy of this
Mortgage to any person having business with the Vessel which might give rise to
a maritime lien upon the Vessel or otherwise be deemed a sale, conveyance,
mortgage or lease thereof and, on demand, to any representative of the
Mortgagee.

Section 2.09                                Removal
of Liens.

The Mortgagor will not suffer to be continued any lien
(other than Permitted Collateral Liens), encumbrance or charge on the Vessel
other than this Mortgage, and in due course and in any event within thirty (30)
days after the same shall become due and payable, will pay or cause to be
discharged or make adequate provisions for the satisfaction or discharge of all
claims or demands secured by any lien, charge or encumbrance on the Vessel and
will cause the Vessel to be released or discharged from any such lien,
encumbrance or charge thereon, without prejudice to Mortgagor’s right to
contest any claims under Section 2.06 hereof following the release or discharge
of such lien.

Section 2.10                                Libel
or Attachment.

If a libel is filed against the Vessel or if it shall
be arrested, attached, levied upon or taken into custody by virtue of any
proceeding in any court or tribunal or by any government or other authority,
the Mortgagor shall promptly notify the Mortgagee

 7
 

thereof by fax, confirmed by overnight letter
addressed to the Mortgagee, and within three (3) days after any such libel,
levy, attachment or taking into custody will cause the Vessel to be released
and will promptly notify the Mortgagee of such release in the manner aforesaid.

Section 2.11                                Maintenance
of Vessel.

The Mortgagor will at all times and without cost or
expense to the Mortgagee cause to be maintained and preserved the Vessel in
good running order and repair, so that the Vessel shall be tight, staunch,
strong and well and sufficiently tackled, appareled, furnished, equipped and in
every respect seaworthy and in good order and operating condition, ordinary
wear and tear excepted.  The Mortgagor
shall cause the Vessel to be drydocked, cleaned and painted whenever required
by good commercial marine maintenance practice and the requirements of any
insurance policy or entries respecting the Vessel.  All maintenance and repairs will be made in a
good and workmanlike manner by persons of appropriate skill and experience
whose work will not adversely affect the service life or marketability of the
Vessel.  All repairs, parts, mechanisms,
devices, replacements, improvements, changes, additions and alterations to the
Vessel shall immediately and without further act, become part of the Vessel and
subject to this Mortgage.  Mortgagor
shall promptly furnish to the Mortgagee copies of each damage survey with
respect to damage to the Vessel where the survey does not specifically quantify
the cost of total damages or where the survey states total damage in excess of
$100,000.00.

Section 2.12                                Changes
in Vessel.

The Mortgagor will not make, or permit to be made, any
change in the structure or type of the Vessel or in its rig that could
reasonably be expected to materially diminish the market value of the Vessel or
that could materially and adversely affect the rights of the Mortgagee under
this Mortgage.

Section 2.13                                Inspection.

The Mortgagor at all times shall afford the Mortgagee
or its authorized representatives full and complete access to the Vessel for
the purpose of inspecting or surveying the same and its papers and, at the
request of the Mortgagee, the Mortgagor shall deliver for inspection copies of
any and all contracts and documents relating to the Vessel, whether on board or
not and shall cause any charterer to comply herewith during the term of any
charter to the maximum extent permitted thereunder; provided that, absent the
continuation of a Mortgage Event of Default, Mortgagee shall organize such
inspections so as not to interfere with the Vessel’s normal operations.

Section 2.14                                Change
of Flag or Documentation.

So long as no Mortgage Default then exists or is
continuing, the Mortgagor may change the flag or documentation of the Vessel in
accordance with the procedures set forth in this Section 2.14, provided that
the Mortgagor may change the flag of or re-document the Vessel only in a
Permitted Flag Jurisdiction.  Not later
than sixty (60) days before the

 8
 

date of such proposed flag change or re-documentation,
the Mortgagor shall provide written notice thereof to the Mortgagee.  Such notice shall (i) describe the proposed
flag change or re-documentation; and (ii) state that such flag change or
re-documentation will not interfere with the Mortgagee’s ability to realize the
value of the Vessel and will not impair the maintenance and operation of the
Vessel.  Contemporaneously with the
delivery of such written notice, the Mortgagor shall deliver to the Mortgagee
(a) an Officer’s Certificate stating that (i) such change of flag or
re-documentation complies with the terms and conditions of the Indenture and
this Mortgage, including, without limitation, the provisions of this Section
2.14; (ii) there is no Mortgage Default in existence or continuing on the date
thereof; (iii) such change of flag or re-documentation will not result in a
Mortgage Default or a Mortgage Event of Default; and (iv) all conditions
precedent in the Indenture and this Mortgage relating to such change of flag or
re-documentation have been complied with; (b) all documentation required by the
TIA (including, without limitation, Section 314(d) of the TIA) prior to the
proposed change of flag or re-documentation; (c) an Opinion of Counsel in the
jurisdiction in which the Vessel is to be re-flagged or re-documented, which
Opinion of Counsel shall be acceptable in form and substance to the Mortgagee
and shall state, among other things, that upon the taking of steps therein described
(including, without limitation, the filing of any ship mortgages, fleet
mortgages or amendments thereto), the Mortgagee will have a valid Lien on the
re-flagged or re-documented Vessel; and (d) all documentation (including,
without limitation, any ship mortgages, fleet mortgages, or amendments thereto)
necessary or reasonably requested by the Mortgagee to grant to the Mortgagee a
perfected first priority Lien (subject only to Permitted Collateral Liens) on
the re-flagged or re-documented Vessel. The Mortgagee and the Mortgagor shall
then promptly take the actions described in the immediately preceding clauses
(c) and (d).

Section 2.15                                Charter
of Vessel.

The Mortgagor will not charter the Vessel to, or
permit the Vessel to serve under any contract of affreightment with, a person
included within the definition of “designated foreign country” or a “national”
of a “designated foreign country” in the “Foreign Assets Control Regulations”
or “Cuban Assets Control Regulations” of the United States Treasury Department,
31 C.F.R. Chapter V, as amended, within the meaning of said regulations or of
any regulation, interpretation or ruling issued thereunder.

Section 2.16                                Requisition
of Title or Use.

In the event that the title to or ownership of the
Vessel, or the use of the Vessel (whether on a bareboat, time or voyage charter
basis or any other basis), shall be requisitioned, purchased or taken by, or
the Vessel shall be seized by or forfeited to, any government of any country or
any department, agency or representative thereof, pursuant to any present or
future law, proclamation, decree, order or otherwise, or by any other
Person(s), whether or not acting under color of governmental authority, the
compensation, purchase price, reimbursement or award for such requisition,
purchase, seizure, forfeiture or other taking of such title, ownership or use
shall forthwith be and become payable to the Mortgagee, who shall be entitled
to receive the same and shall apply it as provided in the Indenture.

 9
 

Section 2.17                                Notice
of Loss, Requisition or Damage.

In the event of (a) the disappearance or actual or
constructive loss of the Vessel, (b) any event referred to in Section 2.16
hereof with respect to the Vessel, or (c) any casualty, accident or damage to
the Vessel in excess of $100,000.00, the Mortgagor will give written notice
thereof (containing full particulars), within three business days of the
occurrence thereof, to the Mortgagee.

Section 2.18                                Insurance.

(a)                                  Form and
Amount.

(i)                                     Hull
& Machinery Insurance.  At its
own expense, Mortgagor will maintain or cause to be maintained with financially
sound and reputable insurers (all risk equivalent) marine hull and machinery
insurance (and, if necessary to satisfy the proviso of this subparagraph,
policies of increased value insurance) and war risk hull & machinery
insurance covering confiscation, appropriation, nationalization and seizure for
vessels operating outside the United States coastal waters on an agreed value
basis on the Vessel against loss, damage, fire and hurricane loss or damage and
such other perils and in such amounts as are usually maintained on vessels
engaged in the same or a similar business under blanket fleet policies with
respect to vessels of like size, character and marine activity; provided,
however, that in no event shall the amount of such insurance at any time be
less than full replacement value.

Such insurance shall be
effective on the date hereof and shall name the Mortgagor, Mortgagee and other
interested persons as insureds as their respective interests may appear, but
(subject only to Section 2.18(b) hereof) shall be payable solely to Mortgagee
for further disbursement by it to the other insureds as their interests may
appear and shall be applied as set forth in Section 2.18(b).

With respect to policies
required under this Section 2.18(a)(i), the deductible for such policies shall
not exceed $100,000.00 per incident.

(ii)                                  Liability
Insurance.  At its own expense,
Mortgagor shall maintain entries with financially sound and reputable insurers
or protection and indemnity associations acceptable to Mortgagee, protecting
the interests of Mortgagor and Mortgagee against liability for property damage
to third persons and personal injury or death to any person arising out of the
maintenance, use, operation and ownership of the Vessel, protection and
indemnity, collision, tower’s liability including crew, cargo, contractual
liabilities, pollution, and removal of wreck insurance (including liability to
any governmental authority or other person with respect to pollution
liability), as well as war risks liability for vessels operating outside the
coastal waters of the United States, in such amounts as are usually carried by
persons engaged in the same or similar businesses; provided, however, that in
no event shall the amount of such insurance per person and per occurrence

 10
 

(subject to a usual and
customary deductible) be less than the customary amount of coverage available
on the market from time to time with respect to vessels of the same type, age
and trade as the Vessel.  Such liability
insurance shall name each of the Mortgagee, and other interested persons as
additional insureds, as their respective interests may appear, but the proceeds
of such policies shall be payable to the Person actually suffering the loss in
respect of which such proceeds are payable. Combined single limits for bodily
injury and property damage shall be in an amount no less than the amount
customarily maintained by prudent companies engaged in the same or similar
businesses operating in the same or similar locations.

(b)                                 Application
of Proceeds. 
All policies of insurance required under this Section 2.18 shall be
placed through first-class marine brokers and shall name the Mortgagor and
Mortgagee, as named insured.  Policies
maintained under Section 2.18(a)(a)(i) above shall name the Mortgagee as a loss
payee and shall provide that all payments in respect of loss or damage shall be
made solely to the Mortgagee for all amounts in excess of $100,000.00 and that
upon the occurrence and continuance of a Mortgage Event of Default hereunder,
all proceeds shall be payable solely to Mortgagee for the benefit of the
Mortgagee.  Any insurance recoveries
under any policies to which the Mortgagee shall be so entitled shall be applied
as provided in Section 4.10 of the Indenture.

(c)                                  Constructive
Total Loss. 
In the event of an accident, occurrence or event resulting in a
constructive total loss of the Vessel, the Mortgagee shall claim for a
constructive total loss of the Vessel and require that Mortgagor declare such
to be a constructive total loss, and if both (i) such claim is accepted by all
underwriters under all policies then in force as to the Vessel under which
payment is due for total loss and (ii) payment in full is made in cash under
such policies, then, with the underwriters’ approval, the Mortgagee shall
abandon the Vessel to the underwriters under such policies, free from the lien
of this Mortgage.

(d)                                 Carriers;
Approvals.  All insurance
required under this Section 2.18 shall be placed and kept with the United
States Government or with reputable American, British, or other insurance
companies, underwriters’ associations, clubs or underwriting funds.

(e)                                  Taking,
Requisition, etc. 
During the continuance of a taking, requisition or charter of the use of
the Vessel by the United States Government, the provisions of this Section
shall be deemed to have been complied with in all respects as to the Vessel if
the United States Government shall have agreed, pursuant to an agreement in
form and substance satisfactory to the Mortgagee, to reimburse the Mortgagee
and the Mortgagor for loss or damage resulting from the risks indicated in
Section 2.18(a).  In the event of any
taking, requisition, charter or loss of the Vessel contemplated by this
paragraph the Mortgagor shall promptly furnish to the Mortgagee an officer’s
certificate stating that such taking, requisition, charter or loss has occurred
and, if such is the case, that the United States Government has agreed to
reimburse the

 11
 

Mortgagee
and the Mortgagor for loss or damage resulting from the risks covered pursuant
to the requirements of Section 2.18(a).

(f)                                    Additional
Provisions.

(i)                                     All
insurance required under this Section 2.18 shall, unless otherwise first agreed
in writing by the Mortgagee, provide that (A) there shall be no recourse
against the Mortgagee for the payment of premiums, supplemental or back calls
or commissions, warranties or representations to underwriters, (B) if such
insurance provides for the payment of club calls, assessments or advances,
there shall be no recourse against the Mortgagee for the payment thereof,
(C) the policies shall provide for severability of interest as though
separate policies were issued to each additional insured, except with respect
to the limits of liabilities, (D) at least thirty (30) days’ prior written
notice of any cancellation, reduction in amount or change in coverage or other
material change of such insurance (seven (7) days prior written notice in the
case of war risk insurance) shall be given to the Mortgagee by the insurance
underwriters, (E) no insurance shall be invalidated by any assignment of
any charters of the Vessel, (F) no insurance required by this Section 2.18
shall be invalidated by reason of any breach of representation or warranty by
Mortgagor and each policy or entry shall have a specific endorsement to the
effect that no violation of the terms, conditions or warranties of the
insurance by the Mortgagor or any of its Affiliates will invalidate the claim
of Mortgagee to coverage under such entries or policies of insurance, and
(G) the insurers agree to advise Mortgagee promptly in writing of any
default in the payment of any premium and of any other act or omission of which
such insurer has knowledge which might invalidate or render unenforceable, in
whole or in part, any such policy.

(ii)                                  The
Mortgagor shall not do any act, nor voluntarily suffer nor permit any act to be
done, whereby any insurance required by this Section 2.18 shall or may be
suspended, impaired or defeated, or suffer or permit the Vessel to engage in
any voyage or any activity not permitted under policies of insurance
satisfactory to the Mortgagee in all respects for such voyage or the engaging
in of such activity. Mortgagee may maintain its own policies of insurance on
and with respect to the Vessel and none of such policies shall be contributory
to satisfy the obligations of Mortgagor or the requirements of the insurances
required by this Section 2.18.

(iii)                               The
Mortgagor shall, on behalf and for the benefit of itself and the Mortgagee,
(A) when required by law, maintain Certificates of Financial
Responsibility (Oil Pollution) issued by the United States Coast Guard pursuant
to the Federal Water Pollution Control Act, as amended inter alia by the Oil
Pollution Act of 1990, and (B) maintain such additional coverage for the
Vessel in respect of pollution liability as may be required by law now or
hereafter in effect or customary among owners of similar vessels engaged in
trade in the United States or in the Republic of Panama from time to time.  Mortgagor shall provide,

 12
 

for Mortgagee’s benefit,
policies of insurance covering freight, demurrage and defense insurance to
cover any legal defense costs.

Section 2.19                                Reimbursement
of Mortgagee.

In the event that Mortgagor shall fail to obtain or
maintain insurance in accordance with the provisions of this Mortgage,
Mortgagee shall have the right to obtain, and pay the premiums on, such
insurance as the Mortgagee reasonably deems necessary.  The Mortgagor shall reimburse the Mortgagee
on demand, with interest (at the interest rate applicable to overdue principal
under the provisions of the Notes) for any and all expenditures which the
Mortgagee may from time to time make, lay out or expend in providing protection
in respect of insurance, discharge or purchase of any liens, taxes, dues,
assessments, governmental charges, fines and penalties imposed, repairs,
attorneys’ fees and other matters as the Mortgagor is obligated herein to
provide, but fails to provide.  Such
obligation of the Mortgagor to reimburse the Mortgagee, together with interest
as provided above, shall be an additional indebtedness due from the Mortgagor,
secured by this Mortgage, and shall be payable by the Mortgagor on demand.  The Mortgagee, though privileged so to do,
shall be under no obligation to the Mortgagor or to any other Person to make
any such expenditures, nor shall the making thereof relieve the Mortgagor of
any Mortgage Event of Default in that respect.

Section 2.20                                Reports.

Mortgagor shall furnish to the Mortgagee annually and
not less than 15 days prior to the renewal or replacement of each policy or
entry thereafter, a report and an original signed certificate of insurance by a
nationally recognized first-class marine insurance broker acceptable to the
Mortgagee, describing in reasonable detail the insurance then carried and
maintained on and with respect to the Vessel and certifying that such insurance
complies with the terms hereof and certifying that the insurances are in the
form, cover the risks and are in the amounts determined in accordance with
Section 2.18 of this Mortgage, and that, in the opinion of such firm, the
insurance then carried and maintained complies with the terms of said Section
2.18.  Mortgagor shall obtain for the
benefit of the Mortgagee the undertaking of Mortgagor’s insurance agent or
broker to promptly advise the Mortgagee in writing of any act or omission of
which such agent or broker has knowledge which might invalidate or render
unenforceable, in whole or in part, any such policy.  The broker shall provide premium information
to the Mortgagee specifying an estimate of the total annual premium by line and
an estimated supplementary calls and assessments required by the P&I Club.

ARTICLE
III

MORTGAGE DEFAULTS AND MORTAGE EVENTS OF DEFAULT

Section 3.01                                Mortgage
Defaults and Mortgage Events of Default.

For the purposes hereof, (a) the occurrence and
continuance of a Default under the Indenture shall be a “Mortgage
Default” hereunder, and (b) the occurrence and

 13
 

continuance of an Event of Default under the Indenture
shall be a “Mortgage Event of Default”
hereunder.

ARTICLE
IV

REMEDIES; APPLICATION OF PROCEEDS

Section 4.01                                Sale,
etc.

During the continuance of any Mortgage Event of
Default, the Mortgagee shall have the right to pursue and enforce any of its
rights and remedies under the Indenture and any other Note Document and, in
addition, Mortgagee may do any one or more of the following as it may elect:

(a)                                  Exercise all
the rights and remedies in foreclosure and otherwise given to mortgagees by the
provisions the laws of the Republic of Panama or other applicable law including
the laws of any other applicable jurisdiction;

(b)                                 Bring suit
at law, in equity or in admiralty or initiate and prosecute such other
judicial, extra-judicial, or administrative proceedings as it may consider
appropriate to recover any and all sums due, or declared due, on the Notes, and
all other obligations due, with the right to enforce payment of said sums
against any assets of the Mortgagor, whether they are covered by this Mortgage
or otherwise;

(c)                                  Take
possession of the Vessel with or without legal proceedings, at any place where
it may be found; and the Mortgagor or any person in possession of the Vessel,
forthwith upon request by the Mortgagee, as mortgage creditor, shall deliver
possession to the Mortgagee, and the Mortgagee shall have the right, without
being responsible for loss or damage, to lay up, hold, charter, lease, operate
or otherwise use the Vessel for such period and under such conditions as it may
deem most expedient for its interest, and demand, collect and retain all hire,
freights, earnings, issues, revenues, income, profits, returns, premiums,
salvage awards or recoveries, recoveries in general average, and all other sums
due or to become due in respect of the Vessel or in respect of any insurance
thereon from any Person whomsoever, accounting only for net profits, if any,
arising from such use and charging against all receipts from such use or from
the sale of the Vessel by court proceedings or pursuant to subsection (d) of
this Section 4.01 below, all costs, expenses (including without limitation
attorneys’ fees and disbursements), charges, damages or losses by reason of
such use; and if at any time the Mortgagee shall avail itself of the right
herein given to it to take the Vessel and shall take them, the Mortgagee shall
have the right to dock the Vessel at any dock, pier or other premises owned or
leased by the Mortgagor without charge, or at any other place at the cost and
expense of the Mortgagor;

(d)                                 Take and
enter into possession of the Vessel, at any time, wherever the same may be,
without legal process, and if it seems desirable to the Mortgagee without being
responsible for loss or damage, sell it at any place or places and at such time
or times as the Mortgagee may specify, at public or private sale, by sealed
bids or otherwise, on such terms and conditions as the Mortgagee deems best,
free of any claim,

 14
 

commitment
or encumbrance, regardless of the nature thereof, in favor of the Mortgagor
and, except as provided by law, in favor of any other person, upon advance
notice of ten (10) consecutive days published in any newspaper authorized to
publish such legal notices in the hailing port and the places of sale of the
Vessel and by sending by mail notice of such sale to the Mortgagor and any
other recorded Mortgagee of the Vessel at least twenty (20) days prior to the
date fixed for such sale.  In the event
that the Vessel shall be offered for sale by private sale, no newspaper publication
of notice shall be required, nor notice of adjournment of sale.  Sale may be held at such place and at such
time as the Mortgagee by notice may have specified, or 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 any such sale at the time and place to which
the same shall be so adjourned; and any sale may be conducted without bringing
the 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 any public sale, and shall have the right to credit on the
purchase price any and all sums of money due to the Mortgagee hereunder or to
the Mortgagee under the Indenture, any other Note Document or under any other
instrument evidencing any Note Obligation.

Section 4.02                                Finality
of Sale.

A sale of the Vessel made in pursuance of this
Mortgage, whether under the power of sale hereby granted or any judicial
proceedings, shall operate to divest all right, title and interest of any
nature whatsoever of the Mortgagor therein and thereto, and shall bar the
Mortgagor, its successors and assigns, and all persons claiming by, through or
under them.  No purchaser shall be bound
to inquire whether notice has been given or whether any Mortgage Event of
Default has occurred, or as to the propriety of the sale, or as to application
of the proceeds thereof.  In case of any
such sale, any purchaser who is the holder of this Mortgage shall be entitled,
for the purpose of making settlement or payment for the Vessel, to apply the
balance due under this Mortgage or a part thereof as part or all of the
purchase price to the extent of the amount remaining due and unpaid.  At any such sale, the holder of this Mortgage
may bid for and purchase the Vessel and upon compliance with the terms of sale
may hold, retain and dispose of the Vessel without further accountability.  At any such sale, the Mortgagee may bid for
the purchase of the Vessel and upon compliance with the terms of sale may hold
and retain and dispose of the Vessel without further accountability therefor.

Section 4.03                                Powers
and Rights of Mortgagee upon Occurrence of a Mortgage Event of Default.

(a)                                  Sale.  For the purpose of Section 4.01 and Section
4.02, the Mortgagor does hereby irrevocably appoint the Mortgagee and its
successors and assigns the true and lawful attorneys-in-fact of the Mortgagor,
in its name and stead, to make all necessary transfers of the Vessel, and for
that purpose the Mortgagee may execute all necessary instruments of assignment
and transfer (including bills of sale), the Mortgagor

 15
 

hereby
ratifying and confirming all that its said attorney shall lawfully do by virtue
hereof.  Nevertheless, the Mortgagor, if
so requested by the Mortgagee, shall ratify and confirm any sale of the Vessel
by executing and delivering to the purchaser thereof such proper bills of sale,
conveyances, instruments of transfer and releases as may be designated in such
request.

(b)                                 Revenues and
Proceeds of the Vessel. 
The Mortgagee is hereby irrevocably appointed attorney-in-fact of the
Mortgagor, upon the happening and during the continuation of any Mortgage Event
of Default in the name of the Mortgagor to demand, collect, receive, compromise
and sue for, so far as may be permitted by law, all freights, hire, earnings,
issues, revenues, income and profits of the Vessel, and all amounts due from
underwriters under any insurance thereon 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 in respect of the
Vessel or in respect of any insurance thereon from any person whomsoever, and
to make, give and execute in the name of the Mortgagor acquittances, receipts,
releases or other discharges for the same, whether under seal or otherwise, and
to endorse and accept in the name of the Mortgagor all checks, notes, drafts,
warrants, agreements and all other instruments in writing with respect to the
foregoing, the Mortgagor hereby confirming and ratifying the same.

(c)                                  Additional
Rights.  The Mortgagor
covenants and agrees that in addition to any and all other rights, powers and
remedies elsewhere in this Mortgage granted to and conferred upon the
Mortgagee, and including, without limitation, in any suit to enforce any of its
rights, powers or remedies, if a Mortgage Event of Default shall have occurred
and be continuing and shall not have been waived by the Mortgagee, the
Mortgagee shall be entitled as a matter of right and not as a matter of
discretion (i) to the appointment of a receiver or receivers of the Vessel and
collection of the freights, hire, earnings, issues, revenues, income and
profits due or to become due arising from any operation of the Vessel, and any
receiver or receivers so appointed shall have full right and power to use and
operate the Vessel, and (ii) to a decree ordering and directing the sale and
disposal of the Vessel, and the Mortgagee may become the purchaser at such sale
and shall have the right to credit on the purchase price any and all sums of
money due hereunder or to the Mortgagee under the Indenture, any other Note
Document or under any other instrument evidencing any Note Obligation.  The Mortgagee shall not be required to have
the Vessel marshaled (upon any sale of the Vessel pursuant to this Mortgage or
otherwise) or be required to realize on any other Collateral prior to
realization on the Vessel.

(d)                                 Restoration of
Position.  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 or abandoned for any reason or shall have been determined
adversely to the Mortgagee, then and in every such case the Mortgagor 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 the Mortgage, and
all rights, remedies and powers of the Mortgagee shall continue as if no such
proceedings had been taken.

 16

Section 4.04                                Application
of Proceeds.

The proceeds of any sale and net earnings derived from
the operation, use, charter, or any other employment of the Vessel by the
Mortgagee, as mortgage creditor, and within any of the powers and authority
above given, as well as the proceeds of any judgment which the Mortgagee may
obtain by reason of the breach or failure to perform any of the terms of this
Mortgage, as well as the proceeds of any claim for damage received by the
Mortgagee while exercising the powers and the authorities above given, shall be
applied by the Mortgagee as provided in the Indenture.

In the event the proceeds and the net earnings
referred to in this Section 4.04 should be insufficient to pay the sum total of
the Note Obligations under the Note Documents, then the Mortgagee, as mortgage
creditor, shall have the right to collect and to receive from the Mortgagor, or
from any other person or persons who may be chargeable in respect thereof, such
amount as will fully pay any remaining deficiency with respect to such
obligations under this Mortgage and the other Note Documents.  In any action to enforce the Mortgage whether
in rem or in personam, in admiralty, in equity or at law, Mortgagor hereby
waives any right to trial by jury.

ARTICLE V

GENERAL POWERS OF MORTGAGEE

(a)                                  Arrest or
Detention of Vessel. 
In the event that the Vessel shall be arrested or detained by a Marshal
or other officer of any court of law, equity or admiralty jurisdiction in any
country or nation of the world or by any government or other Person, the
Mortgagor does hereby authorize and empower the Mortgagee, from the date of
arrest or detention, in the name of the Mortgagor, or its successors or
assigns, to apply for and receive possession of and to take possession of the
Vessel with all the rights and powers that the Mortgagor, or its successors or
assigns, might have, possess or exercise in any such event; and this power of
attorney shall be irrevocable and may be exercised not only by the Mortgagee
but also by its appointee or appointees, with full power of substitution, to
the same extent as if the said appointee or appointees had been named as one of
the attorneys above named by express designation.

(b)                                 Suits.  The Mortgagor also authorizes and empowers
the Mortgagee or its appointees or any of them to appear in the name of the
Mortgagor, its successors or assigns, in any court of any country or nation of
the world where a suit is pending against the Vessel because of or on account
of any alleged lien against the Vessel from which the Vessel has not been
released and to take such proceedings as to them may seem proper towards the
defense of such suit and the discharge of such lien, and all expenditures made
or incurred by them or any of them for the purpose of such defense or discharge
shall be a debt due from the Mortgagor, its successors and assigns, to the
Mortgagee, and shall be secured by the lien of this Mortgage in like manner and
extent as if the amount and description thereof were written herein.

 17
 

ARTICLE
VI

INDEMNITY

The Mortgagor assumes liability for, and agrees to
indemnify and hold the Mortgagee harmless from, all claims, costs, expenses
(including, without limitation, legal expenses), damages and liabilities
arising from or pertaining to this Mortgage or the ownership, use, possession
or operation of the Vessel by anyone other than the Mortgagee or a holder of
the Notes; provided that Mortgagor shall have no obligation hereunder with
respect to indemnified liabilities arising from the gross negligence or wilful
misconduct of the Mortgagee.  The
agreements and indemnities contained in this Article shall survive the maturity
or earlier discharge of this Mortgage and payment in full of the Notes and Note
Obligations.

ARTICLE
VII

SUNDRY PROVISIONS

Section 7.01                                Cumulative
Remedies; No Waiver.

Each and every power and remedy herein given to the
Mortgagee shall be cumulative and shall be in addition to every other power and
remedy herein or now or hereafter existing at law, in equity, in admiralty or
by statute, and each and every power and remedy whether herein 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 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.  No delay or omission by the
Mortgagee in the exercise of any right or power in the pursuance of any remedy
specified in Article 4 accruing upon any Mortgage Event of Default hereof shall
impair any such right, power or remedy or be construed to be a waiver of any
such Mortgage Event of Default or an acquiescence therein; nor shall the
acceptance by the Mortgagee of any security or of any payment of or on account
of any part of the indebtedness secured by this Mortgage or of any payment on
account of any past Mortgage Event of Default be construed to be a waiver of
any right to take advantage of any future Mortgage Event of Default or of any past
Mortgage Event of Default not completely cured thereby.

Section 7.02                                Further
Assurances.

In the event that this Mortgage, or any provisions
hereof, shall be deemed invalid in whole or in part by reason of any present or
future law or any decision of any court having jurisdiction, or if the
documents at any time held by the Mortgagee shall be deemed by the Mortgagee
for any reason insufficient to carry out the rights and powers granted to the
Mortgagee herein, then, from time to time, the Mortgagor will do, execute,
acknowledge and deliver, or cause to be done, executed, acknowledged and
delivered such other and further assurances and documents as in the opinion of
the Mortgagee may reasonably be required in order to more effectively subject
the Vessel to the lien of this Mortgage or more effectively subject the Vessel
to the performance of the terms and

 18
 

provisions of this Mortgage, or to enable this
Mortgage continuously to enjoy the status of a “preferred” mortgage.

Section 7.03                                No
Waiver of Preferred Status.

No provision of this Mortgage shall be deemed to
constitute a waiver by the Mortgagee of the preferred status hereof given by
Panamanian law, and any provision of this Mortgage which would otherwise
constitute such a waiver shall to such extent be of no force or effect.

Section 7.04                                Survival
of Agreements.

All representations, warranties, covenants and
agreements herein contained or made in writing in connection with this Mortgage
shall survive the execution of this Mortgage and shall continue in full force
and effect until all sums secured hereby shall have been paid in full, and the
same shall bind and inure to the benefit of the respective successors and
assigns of the Mortgagor and the Mortgagee.

Section 7.05                                Notices.

All notices and other communications required or
permitted to be given hereunder shall be given in the manner set forth in
Section 12.02 of the Indenture.

Section 7.06                                Counterparts;
Amendments.

This instrument may be executed in any number of
counterparts, and each of such counterparts shall for all purposes be deemed to
be an original.  No amendment,
modification, or waiver of any provision of this Mortgage, and no consent with
respect to any departure of the Mortgagor therefrom, shall be effective unless
the same is in writing and conforms to the requirements set forth in Article IX
of the Indenture.

Section 7.07                                Nature
of Agreements Hereunder.

The agreements, terms, conditions, rights, remedies
and indemnities provided herein are in addition to, not in limitation of, and
shall not be limited by, each of the agreements, terms, conditions, rights,
remedies and indemnities contained in the Indenture.

Section 7.08                                Recording.

For purposes of this Mortgage and for purposes of
recording this Mortgage as required by Panamanian law, the total amount of this
Mortgage is ONE HUNDRED EIGHTY-FIVE MILLION UNITED STATES DOLLARS
($185,000,000) plus interest, costs, expenses and performance of Mortgage
covenants; the discharge amount is the same as the total amount and there is no
separate discharge amount.

 19
 

Section 7.09                                Construction.

Any provision of this Mortgage which is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof and any such prohibition or
unenforceability shall not invalidate or render unenforceable such provision in
any other jurisdiction.  To the extent
permitted by law, Mortgagor hereby waives any provision of law which renders
any provision hereof prohibited or unenforceable in any respect.

Section 7.10                                Governing
Law.

This Mortgage shall be governed by the laws of the
Republic of Panama.

Section 7.11                                Power
of Attorney for Registration.

The parties hereto hereby confer a special power of
attorney with full right of substitution upon the law firm of Morgan &
Morgan of Panama City, the Republic of Panama, empowering them to take all
necessary steps to record the Mortgage created hereby in the appropriate
registries of the Republic of Panama.

[Signature
Page Follows]

 20

IN WITNESS WHEREOF, the Mortgagor has caused this
Mortgage to be duly executed and delivered as of the day and year first above
written.

	
  

  	
  [MORTGAGOR]

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
						

 

SIGNATURE PAGE

FIRST PREFERRED SHIP
MORTGAGE

NOTARIAL CERTIFICATE

I, the undersigned,
NOTARY PUBLIC, duly authorized, admitted and sworn, residing and practicing in
England, DO HEREBYCERTIFY that:

Mr. [insert name]
as [insert title] of [Mortgagor] did sign and deliver the attached First
Preferred Ship Mortgage hereunto annexed in my presence and the signature
appearing at the foot of the said Mortgage, is his authentic signature, and
sufficient proof has been produced to me that he has the right and power to
execute the said Mortgage on behalf of [Mortgagor], as the Mortgagor.

IN TESTIMONY WHEREOF, I
have hereunto subscribed my name and affixed my seal of office on this [    ]
day of November,2006.

	
  

  	
  (Signed)

  	
   

  	
   

  
	
   

  	
   

  	
  PUBLIC NOTARY

  

 

NOTARIAL
CERTIFICATE

FIRST PREFERRED SHIP
MORTGAGE

SCHEDULE I

Vessel

	
  Name of Vessel

  	
   

  	
  :

  
	
   

  	
   

  	
   

  
	
  Permanent Patent Number

  	
   

  	
  :

  
	
   

  	
   

  	
   

  
	
  Call Sign

  	
   

  	
  :

  
	
   

  	
   

  	
   

  
	
  Registered Length

  	
   

  	
  :

  
	
   

  	
   

  	
   

  
	
  Registered Breadth

  	
   

  	
  :

  
	
   

  	
   

  	
   

  
	
  Registered Depth

  	
   

  	
  :

  
	
   

  	
   

  	
   

  
	
  Gross Tonnage

  	
   

  	
  :

  
	
   

  	
   

  	
   

  
	
  Net Tonnage

  	
   

  	
  :

  

 

 1

SCHEDULE II

Information for the Purposes of

Article 1515 of the Panamanian

Commercial Code

	
  Owner/Mortgagor Name and Address:

  	
  [Mortgagor]

  c/o Vives y Asociados

  Edificio Banco Aliado

  Octavo Piso

  Calle Beatrix M. de Cabal

  Guidad Panama

  Panama 5, Republic of Panama

  
	
   

  	
   

  
	
  Mortgagee Name and Address:

  	
  Wilmington Trust Company, as Trustee

  Rodney Square North

  1100 N. Market Street

  Wilmington, Delaware 19890

  U.S.A.

  
	
   

  	
   

  
	
  Mortgage Contract Date:

  	
  November 16, 2006

  
	
   

  	
   

  
	
  Name of Vessel:

  	
   

  
	
   

  	
   

  
	
  Vessel Details:

  	
  Permanent Patent No.:

  Call Sign:

  Registered Length:

  Registered Breadth:

  Registered Depth:

  Gross Tonnage:

  Net Tonnage:

  
	
   

  	
   

  
	
  Mortgage Amount:

  	
  One Hundred Eighty-Five Million U.S. Dollars

  ($185,000,000)

  
	
   

  	
   

  
	
  Maturity Date:

  	
  December 1, 2011 (the “Maturity
  Date”)

  
	
   

  	
   

  
	
  Interests, if any:

  	
  11% per annum; fixed rate

  

 

 1
 

 

	
  Mode of Payment:

  	
  Principal: The
  principal is to be repaid on the Maturity Date.

  Interest: Interest is payable semi-annually on
  December 1 and June 1 of each year.

  

 

 2

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