Document:

ex10-1.htm

    

    Exhibit
10.1

    

    

    STATE
OF NORTH CAROLINA

    COUNTY
OF BUNCOMBE

    EMPLOYMENT
AGREEMENT

    THIS AGREEMENT entered into as
of February 9, 2008 by and between WESTSTAR FINANCIAL SERVICES
CORPORATION (hereinafter referred to as the “Company”), the Company’s
wholly owned subsidiary, BANK
OF ASHEVILLE (hereinafter referred to as the “Bank”), and G. GORDON GREENWOOD
(hereinafter referred to as “Greenwood”).

    W
I T N E S S E T H:

    WHEREAS, the expertise and
experience of Greenwood and his relationships and reputation in the financial
institutions industry are extremely valuable to the Company and the Bank;
and

    WHEREAS, it is in the best
interests of the Bank, the Company and the Company’s shareholders to maintain an
experienced and sound executive management team to manage the Bank and to
further the Bank’s overall strategies to protect and enhance the value of its
shareholders’ investments; and

    WHEREAS, the Company, the Bank
and Greenwood desire to enter into this Agreement to establish the scope, terms
and conditions of Greenwood’s employment; and

    WHEREAS, the Company, the Bank
and Greenwood desire to enter into this Agreement also to provide Greenwood with
security in the event of a change of control of the Company or the Bank and to
ensure the continued loyalty of Greenwood during any such change of control in
order to maximize shareholder value as well as the continued safe and sound
operation of both the Company and the Bank.

    NOW, THEREFORE, for and in
consideration of the premises and mutual promises, covenants and conditions
hereinafter set forth, and other good and valuable consideration, the receipt
and sufficiency of which hereby are acknowledged, the Company, the Bank and
Greenwood hereby agree as follows:

    1.           Employment.  The
Company and the Bank hereby agree to employ Greenwood, and Greenwood hereby
agrees to serve as an officer of the Company and of the Bank, all upon the terms
and conditions stated herein.  As an officer of the Company and the
Bank, Greenwood will (i) serve as President and Chief Executive Officer of the
Company and the Bank, and (ii) have such other duties and responsibilities, and
render to the Company and the Bank such other management services, as are
customary for persons in Greenwood’s position with the Company and the Bank or
as shall otherwise be reasonably assigned to him from time to time by the
Company or the Bank.  Greenwood shall faithfully and diligently
discharge his duties and responsibilities under this Agreement and shall use his
best efforts to implement the policies established by the Company and/or the
Bank.  Greenwood hereby agrees to devote such number of hours of his
working time and

    

    
      
        
           

        

        
           

          
            

          

        

        
           

        

      

    

    

    endeavors
to the employment granted hereunder as Greenwood and the Company and/or the Bank
shall deem to be necessary to discharge his duties hereunder, and, for so long
as employment hereunder shall exist, Greenwood shall not engage in any other
occupation which requires a significant amount of Greenwood’s personal attention
during the Bank’s regular business hours or which otherwise interferes with
Greenwood’s attention to or performance of his duties and responsibilities as an
officer of the Company and the Bank hereunder except with the prior written
consent of the Company or the Bank.  However, nothing herein contained
shall restrict or prevent Greenwood from personally, and for Greenwood’s own
account, trading in stocks, bonds, securities, real estate or other forms of
investment for Greenwood’s own benefit so long as said activities do not
interfere with Greenwood’s attention to or performance of his duties and
responsibilities as an officer of the Company and the Bank
hereunder.

    During
the term of this Agreement, Greenwood shall be allowed, in his sole discretion,
to maintain his primary work location in Asheville, North Carolina.

    2.           Compensation.  For
all services rendered by Greenwood under this Agreement, the Bank shall pay
Greenwood a base salary at a rate of One Hundred Seventy-Four Thousand Four
Hundred Dollars and 00/100’s ($174,400.00) per annum; provided that the rate of
such salary shall be reviewed by the Board of Directors not less often than
annually.  Salary paid under this Agreement shall be payable in cash
not less frequently than monthly. All compensation hereunder shall be subject to
customary withholding taxes and such other employment taxes as are required by
law.  In the event of a Change in Control (as defined in Paragraph 8),
Greenwood’s base salary shall be increased not less than six percent (6%)
annually during the term of this Agreement.

    3.           Participation
in Retirement and Employee Benefit Plans; Fringe Benefits. Subject to the
terms and conditions of this Agreement, Greenwood shall be entitled to
participate in any and all employee benefit programs and compensation plans from
time to time maintained by the Company or the Bank and available to all
employees thereof, all in accordance with the terms and conditions (including
eligibility requirements) of such programs and plans, resolutions of the Board
of Directors establishing such programs and plans, and all normal practices and
established policies regarding such programs and plans.

    In
addition to the other compensation and benefits described in this Agreement, the
Bank:

    (i)           shall
provide Greenwood with four (4) weeks of paid vacation leave;

    (ii)           shall
assume payment of Greenwood’s dues of the Asheville Country Club, Asheville,
North Carolina provided that Greenwood shall be responsible for all personal
expenses for use of such clubs;

    (iii)           shall
reimburse Greenwood for all reasonable expenses incurred by him in the
performance of his duties under this Agreement and documented to the reasonable
satisfaction of the Bank pursuant to established policies;

    

    
      
        
           

        

        
          2

          
            

          

        

        
           

        

      

    

    

    (iv)           shall
provide Greenwood and his spouse with major medical insurance coverage at no
cost to Greenwood which will be a policy at least equivalent to the major
medical insurance coverage generally provided to active full-time employees of
the Bank from time to time; and

    (v)           has
provided a retirement annuity that will pay Greenwood $40,000 per year for ten
years commencing on the date of his retirement.

    (vi)           has
granted to Greenwood options to purchase shares of common stock in accordance
with the requirements of Paragraph 3 of that certain employment agreement by and
between the Bank and Greenwood, dated as of February 9, 2000, which agreement is
superseded by this Agreement.

    4.           Term.  Unless
sooner terminated as provided in this Agreement and subject to the right of
either Greenwood on the one hand or the Company and the Bank on the other hand
to terminate Greenwood’s employment at any time as provided herein, the term of
this Agreement and Greenwood’s employment hereunder shall be for a period
commencing on the date hereof and continuing for a period of three (3)
years.  On each anniversary of the effective date of this Agreement,
the term of this Agreement shall automatically be extended for an additional one
year period unless written notice from Greenwood on the one hand or the Company
and the Bank on the other hand is received ninety (90) days prior to such date
notifying the other party that this Agreement shall not be further
extended.

    5.           Confidentiality
and Non-Competition. Greenwood hereby acknowledges and agrees that (i) in
the course of his service as an officer of the Bank, he will gain substantial
knowledge of and familiarity with the Bank’s customers and its dealings with
them, and other information concerning the Bank’s business, all of which
constitutes valuable assets and privileged information that is particularly
sensitive due to the fiduciary responsibilities inherent in the banking
business; and, (ii) in order to protect the Bank’s interest in and to assure it
the benefit of its business, it is reasonable and necessary to place certain
restrictions on Greenwood’s ability to compete against the Bank and on his
disclosure of information about the Bank’s business and
customers.  For that purpose, and in consideration of the Bank’s
agreements contained herein, Greenwood covenants and agrees as provided
below.

    For the
purposes of this Paragraph 5, the following terms shall have the meanings set
forth below:

    Customer.  The term
“Customer” means any Person with whom, as of the effective date of termination
of this Agreement or Greenwood’s employment with the Bank for any reason, the
Bank has or has had a depository, loan and/or other banking
relationship.

    Financial
Institution.  The term
“Financial Institution” means any federal or state chartered bank, savings bank,
savings and loan association or credit union, or any holding company for
or

    

    
      
        
           

        

        
          3

          
            

          

        

        
           

        

      

    

    

    corporation
that owns or controls any such entity, or any other Person engaged in the
business of making loans of any type or receiving deposits, other than the
Bank.

    Person.  The
term “Person” means any natural person or any corporation, partnership,
proprietorship, joint venture, limited liability company, trust, estate,
governmental agency or instrumentality, fiduciary, unincorporated association or
other entity.

    (a)           Confidentiality
Covenant.  Greenwood covenants and agrees that any and all
data, figures, projections, estimates, lists, files, records, documents, manuals
or other such materials or information (financial or otherwise) relating to the
Bank and its banking business, regulatory examinations, financial results and
condition, lending and deposit operations, customers (including lists of the
Bank’s customers and information regarding their accounts and business dealings
with the Bank), policies and procedures, computer systems and software,
shareholders, employees, officers and directors (herein referred to as
“Confidential Information”) are proprietary to the Bank and are valuable,
special and unique assets of the Bank’s business to which Greenwood will have
access during his employment with the Bank.  Greenwood agrees that (i)
all such Confidential Information shall be considered and kept as the
confidential, private and privileged records and information of the Bank, and
(ii) at all times during the term of his employment with the Bank and following
the termination of this Agreement or his employment for any reason, and except
as shall be required in the course of the performance by Greenwood of his duties
on behalf of the Bank or otherwise pursuant to the direct, written authorization
of the Bank, Greenwood will not: divulge any such Confidential Information to
any other Person or Financial Institution; remove any such Confidential
Information in written or other recorded form from the Bank’s premises; or make
any use of any Confidential Information for his own purposes or for the benefit
of any Person or Financial Institution other than the Bank.  However,
following the termination of Greenwood’s employment with the Bank, this
subparagraph (b) shall not apply to any Confidential Information which then is
in the public domain (provided that Greenwood was not responsible, directly or
indirectly, for permitting such Confidential Information to enter the public
domain without the Bank’s consent), or which is obtained by Greenwood from a
third party which or who is not obligated under an agreement of confidentiality
with respect to such information.

    (b)           Non-Competition
Covenant.   During the term of this Agreement and for a
period of two years after termination, Greenwood agrees that he will not, within
Buncombe County, North Carolina, directly or indirectly own, manage, operate,
join, control or participate in the management, operation or control of or be
employed by or connected in any manner with, any financial institution which
competes with the Bank without the prior written consent of the Board of
Directors of the Bank and provided, however, that the provisions of this Section
5(b) shall not apply in the event that Greenwood’s employment hereunder is
terminated by the Board of Directors of the Bank without “cause” as such term is
defined in Section 6(d) hereof,

    

    
      
        
           

        

        
          4

          
            

          

        

        
           

        

      

    

    

    and in
the event that no additional non-competition agreement is made as part of a
separate severance agreement giving rise to Greenwood’s termination of this
Agreement.

    Notwithstanding
any other provision contained herein, Greenwood’s covenant not to Compete as set
forth in this Paragraph 5(b) shall be null and void upon a “Change in Control”
(as defined in Paragraph 8 hereof) that occurs while Greenwood is employed with
the Bank.

    (c)           Remedies
for Breach.  Greenwood understands and agrees that a breach or
violation by him of the covenants contained in Paragraph 5 of this Agreement
will be deemed a material breach of this Agreement and will cause irreparable
injury to the Bank, and that it would be difficult to ascertain the amount of
monetary damages that would result from any such violation.  In the
event of Greenwood’s actual or threatened breach or violation of the covenants
contained in Paragraph 5, the Bank shall be entitled to bring a civil action
seeking an injunction restraining Greenwood from violating or continuing to
violate those covenants or from any threatened violation thereof, or for any
other legal or equitable relief relating to the breach or violation of such
covenant.  Greenwood agrees that, if the Bank institutes any action or
proceeding against Greenwood seeking to enforce any of such covenants or to
recover other relief relating to an actual or threatened breach or violation of
any of such covenants, Greenwood shall be deemed to have waived the claim or
defense that the Bank has an adequate remedy at law and shall not urge in any
such action or proceeding the claim or defense that such a remedy at law
exists.  However, the exercise by the Bank of any such right, remedy,
power or privilege shall not preclude the Bank or its successors or assigns from
pursuing any other remedy or exercising any other right, power or privilege
available to it for any such breach or violation, whether at law or in equity,
including the recovery of damages, all of which shall be cumulative and in
addition to all other rights, remedies, powers or privileges of the
Bank.

    Notwithstanding
anything contained herein to the contrary, Greenwood agrees that the provisions
of Paragraph 5(a) above and the remedies provided in this Paragraph 5(c) for a
breach by Greenwood shall be in addition to, and shall not be deemed to
supersede or to otherwise restrict, limit or impair the rights of the Bank under
the Trade Secrets Protection Act contained in Article 24, Chapter 66 of the
North Carolina General Statutes, or any other state or federal law or regulation
dealing with or providing a remedy for the wrongful disclosure, misuse or
misappropriation of trade secrets or other proprietary or confidential
information.

    (d)           Survival
of Covenants.  Greenwood’s covenants and agreements and the
Bank’s rights and remedies provided for in this Paragraph 5 shall survive any
termination of this Agreement or Greenwood’s employment with the
Bank.

    

    
      
        
           

        

        
          5

          
            

          

        

        
           

        

      

    

    

    6.           Termination and Termination
Pay.

    (a)           Greenwood’s
employment under this Agreement may be terminated at any time by Greenwood upon
sixty (60) days written notice to the Bank and the Company.  Upon such
termination, Greenwood shall be entitled to receive compensation through the
effective date of such termination; provided, however, that the Bank, in its
sole discretion, may elect for Greenwood not to serve out part or all of said
notice period.

    (b)           Greenwood’s
employment under this Agreement shall be terminated upon the death of Greenwood
during the term of this Agreement.  Upon any such termination,
Greenwood’s estate shall be entitled to receive any compensation due to
Greenwood computed through the last day of the calendar month in which his death
shall have occurred but which remains unpaid.

    (c)           In
the event Greenwood becomes disabled during the term of his employment hereunder
and it is determined by the Bank that Greenwood is permanently unable to perform
his duties under this Agreement, the Bank shall continue to compensate Greenwood
at the level of compensation described in Paragraph 2 above, and shall continue
to provide Greenwood each of the other benefits set forth or described in this
Agreement, for the remaining term of this Agreement, less any other payments
provided under any disability income plan of the Bank which is applicable to
Greenwood.  In the event of any disagreement between Greenwood and the
Bank as to whether Greenwood is physically or mentally incapacitated such as
will result in the termination of Greenwood’s employment pursuant to this
Paragraph 6(c), the question of such incapacity shall be submitted to an
impartial and reputable physician for determination, selected by mutual
agreement of Greenwood and the Bank or, failing such agreement, by two (2)
physicians (one (1) of whom shall be selected by the Bank and the other by
Greenwood), and such determination of the question of such incapacity by such
physician or physicians shall be final and binding on Greenwood and the
Bank.  The Bank shall pay the reasonable fees and expenses of such
physician or physicians in making any determination required under this
Paragraph 6(c).

    (d)           The
Company and the Bank may terminate Greenwood’s employment at any time for any
reason with or without “Cause” (as defined below), but any such termination
other than termination for “Cause”, (as defined below) shall not prejudice
Greenwood’s right to compensation or other benefits under this Agreement for its
remaining term.  Following any termination of Greenwood’s employment
by the Company and the Bank for “Cause,” Greenwood shall have no further rights
under this Agreement (including any right to receive compensation or other
benefits for any period after such termination).

    For
purposes of this Paragraph 6(d), the Company and the Bank shall have “Cause” to
terminate Greenwood’s employment upon:

    

    
      
        
           

        

        
          6

          
            

          

        

        
           

        

      

    

    

    (i)           A
determination by the Company or the Bank, in good faith, that Greenwood (A) has breached in any
material respect any of the terms or conditions of this Agreement, or (B) is engaging or has engaged
in willful misconduct or conduct which is detrimental to the business prospects
of the Company or the Bank or which has had or likely will have a material
adverse effect on the business or reputation of the Company or the
Bank.  Prior to any termination of Greenwood’s employment for a
breach, failure to perform or conduct described in this subparagraph (i), the
Bank or the Company shall give Greenwood written notice which describes such
breach, failure to perform or conduct and if during a period of five business
(5) days following such notice Greenwood cures or corrects the same to the
reasonable satisfaction of the Company and the Bank, then this Agreement shall
remain in full force and effect.  However, notwithstanding the above,
if the Company or the Bank has given written notice to Greenwood on a previous
occasion of the same or a substantially similar breach, failure to perform or
conduct, or of a breach, failure to perform or conduct which the Company or the
Bank determines in good faith to be of substantially similar import, or if the
Company or the Bank determines in good faith that the then current breach,
failure to perform or conduct is not reasonably curable, then termination under
this subparagraph (i) shall be effective immediately and Greenwood shall have no
right to cure such breach, failure to perform or conduct.

    (ii)           The
violation by Greenwood of any applicable federal or state law, or any applicable
rule, regulation, order or statement of policy promulgated by any governmental
agency or authority having jurisdiction over the Company or the Bank or any of
its affiliates or subsidiaries (a “Regulatory Authority”, including without
limitation the Federal Deposit Insurance Corporation, the North Carolina
Commissioner of Banks, the Federal Reserve Bank of Richmond or any other banking
regulator having legal jurisdiction over the Company or the Bank), which results
from Greenwood’s gross negligence, willful misconduct or intentional disregard
of such law, rule, regulation, order or policy statement and results in any
substantial damage, monetary or otherwise, to the Company or the Bank or any
affiliate or subsidiary thereof, or to the reputation of the Company or the
Bank;

    (iii)           The
commission in the course of Greenwood’s employment with the Company or the Bank
of an act of fraud, embezzlement, theft or proven personal dishonesty (whether
or not resulting in criminal prosecution or conviction);

    (iv)           The
conviction of Greenwood of any felony or any criminal offense involving
dishonesty or breach of trust, or the occurrence of any event described in
Section 19 of the Federal Deposit Insurance Act or any other event or
circumstance which disqualifies Greenwood from serving as an employee or
executive officer of, or a party affiliated with, the Bank or its bank holding
company;

    

    
      
        
           

        

        
          7

          
            

          

        

        
           

        

      

    

    

    (v)           Greenwood
becomes unacceptable to, or is removed, suspended or prohibited from
participating in the conduct of the affairs of the Company or the Bank (or if
proceedings for that purpose are commenced) by any Regulatory Authority;
and,

    (vi)           The
occurrence of any event believed by the Company or the Bank, in good faith, to
have resulted in Greenwood being excluded from coverage, or having coverage
limited as to Greenwood as compared to other covered officers or employees,
under the Bank’s then current “blanket bond” or other fidelity bond or insurance
policy covering the directors, officers or employees of the Company or the
Bank.

    7.           Additional
Regulatory Requirements.  Notwithstanding anything contained in
this Agreement to the contrary, it is understood and agreed that the Bank (or
its successors in interest) shall not be required to make any payment or take
any action under this Agreement if (a) the Bank is declared by
any Regulatory Authority to be insolvent, in default or operating in an unsafe
or unsound manner, or if (b) in the opinion of counsel
to the Bank such payment or action (i) would be prohibited by or
would violate any provision of state or federal law applicable to the Bank,
including without limitation the Federal Deposit Insurance Act and Chapter 53 of
the North Carolina General Statutes as now in effect or hereafter amended, (ii) would be prohibited by or
would violate any applicable rules, regulations, orders or statements of policy,
whether now existing or hereafter promulgated, of any Regulatory Authority, or
(iii) otherwise would be
prohibited by any Regulatory Authority.

    8.           Change in
Control

     

    (a)           In
the event that during the term of this Agreement, Greenwood’s employment is
terminated by the Company and/or the Bank other than for Cause or Disability or
Greenwood terminates such employment following an Adverse Change, in any of the
foregoing cases within twenty-four (24) months after a Change in Control (each a
“Change in Control Termination”), Greenwood shall be entitled to receive the
Change in Control Benefit specified in this Paragraph 8.  The date on
which Greenwood’s employment has actually been terminated, for whatever reason,
shall be deemed the Change in Control Termination Date.

    (b)           An
Adverse Change shall mean the occurrence of any of the following:

    (i)             Greenwood
is assigned any duties and/or responsibilities that are inconsistent with his
position, duties, responsibilities, or status at the time of the Change in
Control or with his reporting responsibilities or titles with the Company and
the Bank in effect at such time;

    (ii)             Greenwood’s
annual base salary is reduced below the amount in effect as of the effective
date of a Change in Control or as the same shall have been increased from time
to time following such effective date;

    

    
      
        
           

        

        
          8

          
            

          

        

        
           

        

      

    

    

    (iii)             Greenwood’s
life insurance, medical or hospitalization insurance, disability insurance,
dental insurance, stock option plans, stock purchase plans, deferred
compensation plans, management retention plans, retirement plans, or similar
plans or benefits being provided by the Company or the Bank to Greenwood as of
the effective date of the Change in Control are reduced in their level, scope,
or coverage, or any such insurance, plans, or benefits are eliminated, unless
such reduction or elimination applies proportionately to all salaried employees
of the Company and/or Bank who participated in such benefits prior to such
Change in Control; or

    (iv)             Greenwood
is transferred to a location outside of Asheville, North Carolina, without
Greenwood’s express written consent.

    An
Adverse Change shall be deemed to have occurred on the date such action or event
is implemented or takes effect.

    (c)           The
Change in Control Benefit shall be an amount equal to two hundred ninety-nine
percent (299%) of Greenwood’s “base amount” as defined in Section 28OG(b) (3)
(A) of the Internal Revenue Code of 1986, as amended (the “Code”) to be paid by
the Bank to Greenwood.

    (d)           For
the purposes of this Agreement, the term Change in Control shall mean any of the
following events:

    (i)             After
the effective date of this Agreement, any “person” (as such term is defined in
Section 7 (j) (8) (A) of the Change in Bank Control Act of 1978), directly or
indirectly, acquires beneficial ownership of voting stock, or acquires
irrevocable proxies or any combination of voting stock and irrevocable proxies,
representing thirty-five percent (35%) or more of any class of voting securities
of the Bank or the Company, or acquires control of in any manner the election of
a majority of the directors of the Bank or Company;

    (ii)             The
Bank or Company consolidates or merges with or into another corporation,
association, or entity, or is otherwise reorganized, where either the Bank or
Company is not a surviving corporation in such transaction; or

    (iii)             All
or substantially all of the assets of the Bank or Company are sold or otherwise
transferred to or are acquired by any other corporation, association, or other
person, entity, or group.

    Notwithstanding
the other provisions of this Paragraph 8, a transaction or event shall not be
considered a Change in Control if, prior to the consummation or occurrence of
such transaction or event,

    

    
      
        
           

        

        
          9

          
            

          

        

        
           

        

      

    

    

    Greenwood
and the Company or the Bank agree in writing that the same shall not be treated
as a Change in Control for purposes of this Agreement.

    (e)           Amounts
payable pursuant to this Paragraph 8 will not be paid until the earliest of (i)
the first day of the seventh month after the Change in Control Termination Date
for reasons other than Greenwood’s death; (ii) the date of Greenwood’s death; or
(iii) any earlier date that does not result in additional tax or interest to
Greenwood under Section 409A of the Code.  As promptly as possible
after the end of the period during which payments are delayed pursuant to this
Subparagraph 8(e), the payments called for by this Agreement shall be paid to
Greenwood in a single lump sum.

    (f)           Following
an Adverse Change which gives rise to Greenwood’s rights hereunder, Greenwood
shall have twenty-four (24) months from the date of occurrence of the Adverse
Change to terminate his employment pursuant to this Paragraph 8. Any such
termination shall be deemed to have occurred only upon delivery to the Company
and the Bank or any successor(s) thereto, of written notice of termination which
describes the Change in Control and Adverse Change.   If
Greenwood does not so terminate this Agreement within such twenty-four (24)
month period, Greenwood shall thereafter have no further rights hereunder with
respect to that Adverse Change, but shall retain rights, if any, hereunder with
respect to any other Adverse Change as to which such period has not
expired.

    (g)           It
is the intent of the parties hereto that all payments made pursuant to this
Agreement be deductible by the Bank for federal income tax purposes and not
result in the imposition of an excise tax on Greenwood.  However, if
any payments to be made to or for the benefit of Greenwood are deemed to be
“parachute payments” as that term is defined in Section 28OG(b)(2) of the Code,
the Bank shall pay to Greenwood the amount of any excise taxes imposed on
Greenwood as well as any additional tax imposed on Greenwood as a result of such
payment.

    (h)           In
the event any dispute shall arise between Greenwood on the one hand and the
Company or the Bank on the other hand as to the terms or interpretation of this
Agreement, including this Paragraph 8, whether instituted by formal legal
proceedings or otherwise, including any action taken by Greenwood to enforce the
terms of this Paragraph 8 or in defending against any action taken by the
Company or the Bank, the Bank shall reimburse Greenwood for all costs and
expenses, proceedings or actions, in the event Greenwood prevails in any such
action.

    9.           Successors and
Assigns.

    (a)           This
Agreement shall inure to the benefit of and he binding upon any corporate or
other successor of the Company or the Bank which shall acquire, directly or
indirectly, by conversion, merger, consolidation, purchase or otherwise, all or
substantially all of the assets of either such respective entity.

    

    
      
        
           

        

        
          10

          
            

          

        

        
           

        

      

    

    

    (b)           The
Company and the Bank are contracting for the unique and personal skills of
Greenwood.  Therefore, Greenwood shall be precluded from assigning or
delegating his rights or duties hereunder without first obtaining the written
consent of the Company and the Bank.

    10.           Modification;
Waiver; Amendments.  No provision of this Agreement may be
modified, waived or discharged unless such waiver, modification or discharge is
agreed to in writing and signed by the parties hereto.  No waiver by
either party hereto, at any time, of any breach by the other party hereto of, or
compliance with, any condition or provision of this Agreement to be performed by
such other party shall be deemed a waiver of similar or dissimilar provisions or
conditions at the same or at any prior or subsequent time.  No
amendments or additions to this Agreement shall be binding unless in writing and
signed by both parties, except as herein otherwise provided.

    11.           Applicable
Law.  This Agreement shall be governed in all respects whether
as to validity, construction, capacity, performance or otherwise, by the laws of
North Carolina, except to the extent that federal law shall be deemed to
apply.

    12.           Severability.  The
provisions of this Agreement shall be deemed severable and the invalidity or
unenforceability of any provision shall not affect the validity or
enforceability of the other provisions hereof.

    13.           Entire
Agreement.  This Agreement
constitutes the entire agreement between the parties and supercedes any prior
understandings, whether oral or written.  Furthermore, there are no
agreements or representations between the parties except as expressed
herein.

    14.           Section
409A Compliance.   The parties
hereto intend that their exercise of authority or discretion under this
Agreement shall comply with Section 409A of the Code.  In that regard,
if any provision of this Agreement is ambiguous as to its satisfaction of the
requirements of Section 409A, such provision shall nevertheless be applied in a
manner consistent with those requirements.  The Company and the Bank
shall maintain to the maximum extent practicable the original intent of the
applicable provision without subjecting Greenwood to additional tax or interest,
and neither the Company nor the Bank shall be required to incur additional
compensation expense as a result of the reformed
provision.  References in this Agreement to Section 409A of the Code
include rules, regulations and guidance of general application issued by the
Department of Treasury under Section 409A of the Code.

    

    
      
        
           

        

        
          11

          
            

          

        

        
           

        

      

    

    

    IN WITNESS WHEREOF, the parties
have executed this Agreement under seal and in such form as to be binding as of
the day and year first hereinabove written.

    

    
      	 
      	 
      	
              WESTSTAR
      FINANCIAL SERVICES CORPORATION

            
	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      
	 
      	 
      	
              By:

            	
              /s/
      David N. Wilcox

            
	 
      	 
      	 
      	
              David
      N. Wilcox, Chairman

            
	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      
	
              ATTEST:

            	 
      	 
      	 
      
	 
      	 
      	 
      	 
      
	
              /s/
      Randall C. Hall

            	 
      	 
      	 
      
	
              ____________________,
      Secretary

            	 
      	 
      	 
      
	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      
	 
      	 
      	
              BANK
      OF ASHEVILLE

            
	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      
	 
      	 
      	
              By:

            	
              /s/
      David N. Wilcox

            
	 
      	 
      	 
      	
              David
      N. Wilcox, Chairman

            
	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      
	
              ATTEST:

            	 
      	 
      	 
      
	 
      	 
      	 
      	 
      
	
              /s/
      Randall C. Hall

            	 
      	 
      	 
      
	
              ____________________,
      Secretary

            	 
      	 
      	 
      
	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	
              /s/
      G. Gordon Greenwood

            
	 
      	 
      	 
      	
              G.
      Gordon Greenwood

            
	 
      	 
      	 
      	 
      

    

    

    12d889264_ex4-6.htm

    

    EXHIBIT
4.6

    

    

    

    
      	
              To:

            	
              Omega
      Navigation Enterprises Inc.

            

    

    
      	
               
      

            	
              Trust
      Company Complex,

            

    

    
      	
               
      

            	
              Ajeltake
      Road,

            

    

    
      	
               
      

            	
              Ajeltake
      Islands,

            

    

    
      	
               
      

            	
              Majuro
      MH 96960,

            

    

    
      	
               
      

            	
              Marshall
      Islands

            
	 	 

    

    2007

    

    

    Dear
Sirs,

    We
are pleased to place a loan facility (hereinafter called "the Loan") at your disposal on
the following terms and conditions:-

    

    
      	
              1.

            	
              Borrower

            	
              :

            	
              Omega
      Navigation Enterprises Inc. of the Republic of the Marshall
      Islands

            

    

    

    
      	
              2.

            	
              Lender

            	
              :

            	
              HSH
      Nordbank AG acting through its office at Gerhart-Hauptmann-Platz 50, 20095
      Hamburg, Federal Republic of
Germany

            

    

    

    
      	
              3.

            	
              Amount

            	
              :

            	
              Two
      million four hundred and thirty two thousand six hundred and fifty United
      States Dollars (US$2,432,650).

            

    

    

    
      	
              4.

            	
              Interest

            	 
      	 
      

    

    

    
      	 
      	
              4.1

            	
              Interest
      rate  Interest shall accrue and be payable on each day
      elapsing and shall be calculated on the basis of a 360 day year. The
      Borrower shall pay interest on outstanding principal in arrears on the
      final day of each Interest Period (as defined in clause 4.2) or every
      three months, if any Interest Period exceeds three months (or on the due
      date for repayment of the Loan if earlier) at the rate (the "Interest Rate")
      certified by the Lender to be one point two five per cent (1.25%) per
      annum over LIBOR.

            

    

    

    
      	 
      	
              4.2

            	
              Interest
      Periods  The first period for the calculation of interest
      in respect of the Loan (the "Interest Period") shall
      commence on the date of drawdown of the Loan and each subsequent Interest
      Period shall commence on the final day of the preceding Interest
      Period.  Each Interest Period shall be either, one, three or six
      months at the option of the Borrower by written notice to the Lender not
      later than 11.00 a.m. on the third banking day before the beginning of the
      Interest Period in question, or such other duration as may be selected by
      the Borrower and agreed by the Lender.  If any Interest Period
      would otherwise expire on a day which is not a banking day in London, New
      York, or Hamburg ("Banking Day") that
      Interest Period shall be extended to expire on the next succeeding Banking
      Day.

            

    

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    
 

    
      	
              5.

            	
              Availability

            	 
      	 
      

    

    

    
      	 
      	
              5.1

            	
              Conditions Precedent The
      obligation of the Lender to make the Loan available is contingent upon the
      Lender having received each of the following in form and substance
      satisfactory to the Lender on or before the Drawdown
  Date:-

            

    

     

    
      	 
      	 
      	
              5.1.1

            	
              One
      counterpart of this Facility Letter duly signed by a duly authorised
      representative of the Borrower.

            

    

    

    
      	 
      	 
      	
              5.1.2

            	
              Such
      corporate documents and corporate authorisations of the Borrower as the
      Lender may require.

            

    

    

    
      	 
      	 
      	
              5.1.3

            	
              Copies
      of all necessary permissions (if any are so required) by the relevant
      governmental authorities for the obtaining and servicing of the
      Loan.

            

    

    

    
      	 
      	 
      	
              5.1.4

            	
              Unqualified
      legal opinions from lawyers appointed by the Lender in form and substance
      acceptable to the Lender.

            

    

    

    
      	 
      	 
      	
              5.1.5

            	
              Evidence
      that the sum of ten thousand United States Dollars (US $10,000) has been
      deposited with the Lender for the purpose of paying the Arrangement Fee
      (defined in clause 8).

            

    

    

    
      	 
      	 
      	
              5.1.6

            	
              The
      Borrower shall supply to the Lender, its audited (or un-audited, if the
      audit has not been completed) consolidated financial statements for the
      financial year ended 31 December
2006.

            

    

    

    
      	 
      	
              5.2

            	
              No
      waiver   If the Lender in its absolute discretion
      allows the Loan to be drawn down notwithstanding that it has not received
      all the items specified in clause 5.1 hereof the Borrower hereby covenants
      to procure the delivery of all the missing items to the Lender within
      fifteen (15) days after the Drawdown Date of the
  Loan.

            

    

     

     

     

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

    
 

    
      	
              6.

            	
              Purpose

            	 
      

    

    

    
      	 
      	
              The
      purpose of the Loan is to assist the Borrower in providing inter-company
      loans to Orange Navigation Inc. and Baytown Navigation Inc. respectively
      (together, the "Owners", and each an
      "Owner"), which
      are both subsidiaries of the Borrower, to assist them in part –financing
      the purchase of the Ice Class 1A coated Panamax –Tankers m.t. OMEGA
      EMMANUEL (with IMO number 9314167) and m.t. OMEGA THEODORE with (IMO
      number 9314179) (together, the "Ships" and each a "Ship") each built at STX
      Shipyard of South Korea and upon delivery to be registered under the laws
      and flag of the Republic of Liberia in the ownership of each respective
      Owner.

            

    

    

    
      	
              7.

            	
              Drawdown

            
	 
      	 
      
	 
      	
              Subject
      to the provisions of clause 5 hereof, the Loan shall be drawn down in one
      amount on the delivery date of the last Ship to be delivered to its Owner
      but not later than 15 May 2007 (the "Drawdown Date") upon
      the Borrower giving due notice of
drawdown.

            

    

    

    
      	
              8.

            	
              Fee

            
	 
      	 
      
	 
      	
              The
      Borrower shall pay the Lender an arrangement fee of ten thousand United
      States Dollars (US $10,000) no later than the Drawdown Date of the Loan
      (the "Arrangement
      Fee").

            

    

    

    
      	
              9.

            	
              Indemnity

            
	 
      	 
      
	 
      	
              All
      costs, legal fees, registration fees, taxes, stamp duties and all other
      charges and disbursements whatsoever incurred by the Lender in connection
      with the preparation, execution and/or administration of this letter and
      the documents executed pursuant thereto and the completion protection
      and/or enforcement of the Lender's security hereunder or thereunder shall
      be paid by the Borrower forthwith upon the demand by the
      Lender.

            

    

    

    

    
      
        
           

        

         

      

      
        3

        
          

        

      

      
         

      

    

    

    
      	
              10.

            	
              Repayment

            
	 
      	 
      
	 
      	
              The
      Borrower shall repay the Loan in full in one amount on the date falling
      364 days after the Drawdown Date but not later than May 14 2008 (the "Final Maturity
      Date").

            

    

    

    
      	
              11.

            	
              Prepayment

            

    

    

    
      	 
      	
              11.1

            	
              Voluntary Prepayment
      Subject to fifteen (15) days' prior written notice to the Lender the
      Borrower may prepay the whole (but not part) of the Loan on the final day
      of any Interest Period. Any prepayment under this clause will be made
      without penalty.

            
	 
      	 
      	 
      
	 
      	
              11.2

            	
              Mandatory prepayment on sale or
      Total Loss   If a Ship is sold by its Owner, or
      becomes a Total Loss, the Borrower shall, simultaneously with any such
      sale or within one hundred and twenty (120) days after any such Total
      Loss, prepay the whole of the Loan, together with accumulated interest
      thereon.  If such prepayment does not take place on the last day
      of an Interest Period, the Borrower has to compensate the Lender for any
      costs, losses, premiums or penalties incurred by the Lender as a result of
      its receiving any prepayment of all or any part of the
    Loan.

            
	 
      	 
      	 
      
	 
      	
              Any
      amount so prepaid shall not be available for
  re-borrowing.

            

    

    

    
      	
              12.

            	
              Payments

            

    

    

    
      	 
      	
              12.1

            	
              All
      payments by the Borrower hereunder, shall be made in United States Dollars
      free and clear of taxes, deductions or withholdings to such bank or banks
      as the Lender may nominate from time to time. In the event that any taxes
      deductions or withholdings are introduced the Borrower shall pay such
      additional amounts as will result in the Lender receiving the full amount
      due to it hereunder.

            
	 
      	 
      	 
      
	 
      	
              12.2

            	
              If
      the Borrower for any reason defaults in the payment of any amount due on
      its due date under this Facility Letter, the Borrower shall on the demand
      of the Lender from time to time pay interest on the defaulted amounts at
      the Default Rate (as defined below) from the date of default until the
      date of actual payment to the Lender.  The Lender in such
      circumstances reserves the right to claim additional
    damages.

            
	 
      	 
      	 
      
	 
      	
              12.3

            	
              The
      "Default Rate"
      means the Interest Rate plus two per cent (2%) per
  annum.

            

    

     

     

    
      
         

      

      
        4

        
          

        

      

      
         

      

    

    
 

    
      	
              13.

            	
              Judgment
      Currency

            
	 
      	 
      	 
      
	 
      	
              The
      Borrower shall indemnify the Lender fully for any loss or damage arising
      from any judgment obtained or enforced in respect of the non-payment of
      any amount by the Borrower under or pursuant to this Facility Letter
      consequent upon any variation of rates of exchange between the currency in
      which that amount was due and the currency in which that judgment is
      obtained.

            
	 
      	 
      	 
      
	
              14.

            	
              Loan
      Account

            
	 
      	 
      	 
      
	 
      	
              The
      Lender shall open and maintain a loan account in the name of the Borrower
      showing the advance of the Loan, the computation and payment of interest
      and the payment of all other sums due hereunder.  The Borrower's
      obligation to repay the Loan, pay interest thereon and all other sums
      shall be evidenced by the entries from time to time made therein, such
      entries to be conclusive and binding on the Borrower.  A
      certificate issued by the Lender in respect of such account or any other
      matter in connection with this Facility Letter shall save in the case of
      manifest error be conclusive and binding on the
  Borrower.

            

    

    

    
      	
              15.

            	
              Assignment

            
	 
      	 
      	 
      
	 
      	
              15.1

            	
              Assignment by Lender The Lender may
      assign all or any part of its rights under the Loan to any other bank or
      financial institution or to a trust, fund or other entity which is
      regularly engaged in or established for the purpose of making, purchasing
      or investing in liens, securities or other financial assets (an “Assignee”) and provided
      that no Event of Default has occurred with the consent of the Borrower
      (which consent shall not be unreasonably withheld or
    delayed).

            
	 
      	 
      	 
      
	 
      	
              15.2

            	
              Benefit and
      burden  This Facility Letter shall be binding upon, and
      endure for the benefit of, the Lender, the Borrower and their respective
      successors.

            
	 
      	 
      	 
      
	 
      	
              15.3

            	
              No assignment by
      Borrower The Borrower may not assign or transfer any of its rights
      or obligations under this Facility
Letter.

            

    

     

     

    
      
         

      

      
        5

        
          

        

      

      
         

      

    

    
 

    
      	
              16.

            	
              Application
      of Funds

            
	 
      	 
      	 
      
	 
      	
              After
      repayment of the Loan has been demanded by the Lender any and all moneys
      received by the Lender under or pursuant to this Facility Letter shall be
      applied by the Lender as follows:-

            
	 
      	 
      	 
      
	 
      	
              16.1

            	
              first,
      in payment of all unpaid costs and expenses of the Lender;
    and

            
	 
      	 
      	 
      
	 
      	
              16.2

            	
              secondly,
      in payment of any and all other sums whatsoever due and payable to the
      Lender under this Facility Letter in such order as the Lender shall select
      in its discretion.

            

    

    

    
      	
              17.

            	
              Representations

            
	 
      	 
      	 
      
	 
      	
              No
      litigation, arbitration or administrative proceedings of or before any
      court, arbitral body  or agency have been started or (to the
      best of the Borrower's knowledge threatened) which, if adversely
      determined, might reasonably be expected to have a materially adverse
      effect on the business, assets, financial condition or credit worthiness
      of the Borrower.

            

    

    

    
      	
              18.

            	
              Financial
      Undertakings

            
	 
      	 
      	 
      
	 
      	
              18.1

            	
              Financial Covenants The
      Borrower shall procure that the financial covenants contained in clause
      8.7 of the Loan Agreement (as defined in clause 21) are complied with in
      all respects.

            
	 
      	 
      	 
      
	 
      	
              18.2

            	
              Financial
      statements   The Borrower shall supply to the Lender
      at the end of each Financial Quarter a compliance certificate (in form and
      substance acceptable to the Lender), signed by the Borrower's Chief
      Financial Officer, setting out (in reasonable detail) computations as to
      compliance with clause 18.1 as at the date as at which those financial
      statements were drawn up.

            

    

    

    
      	
              19.

            	
              General
      covenants

            
	 
      	 
      	 
      
	 
      	
              The
      Borrower shall not without the prior written consent of the Lender make
      any substantial change to the general nature of its business from that
      carried on at the date of this Facility
Letter.

            

    

     

     

    
      
         

      

      
        6

        
          

        

      

      
         

      

    

    
 

    
      	
              20.

            	
              Further
      Assurance

            
	 
      	 
      	 
      
	 
      	
              The
      Borrower shall from time to time at the written request of the Lender do
      all such things and execute or procure the execution of all such documents
      as the Lender may consider necessary or desirable for giving full effect
      to this Facility Letter and the documents executed pursuant
      hereto.

            

    

    

    
      	
              21.

            	
              Definitions
      and Interpretation

            
	 
      	 
      	 
      
	 
      	
              The
      terms "Borrower's
      Group", "Encumbrance",
      "Financial
      Quarter", "LIBOR",
      "Permitted
      Liens" and "Total
      Loss" defined in the loan agreement made between the (1)
      Borrower and (2) the banks and financial institutions whose names and
      addresses are set out in Schedule 1, Part 1 thereto, the Lender (in its
      capacity as mandated lead arranger), the Lender (in its capacity as swap
      bank) and the Lender (in its capacity as agent, security agent and
      trustee) dated 7 April 2006  as amended and supplemented by a
      first supplemental agreement dated 28 July 2006 and as further amended and
      supplemented by a second supplemental agreement dated 21 March 2007 (the
      "Loan
      Agreement"),  shall have the same meaning (mutatis
      mutandis) when used in this Facility
Letter.

            

    

    

    
      	
              22

            	
              Events
      of Default

            
	 
      	 
      	 
      
	 
      	
              22.1

            	
              Events

            
	 
      	 
      	 
      
	 
      	
              There
      shall be an Event of Default if:

            

    

    

    
      	 
      	 
      	
              22.1.1

            	
              Non-payment: the
      Borrower fails to pay any sum payable by it under this Facility Letter at
      the time, in the currency and in the manner stipulated in this Facility
      Letter (and so that, for this purpose, sums payable on demand shall be
      treated as having been paid at the stipulated time if paid within three
      (3) Banking Days of demand); or

            
	 
      	 
      	 
      	 
      
	 
      	 
      	
              22.1.2

            	
              Breach of other
      obligations: the Borrower commits any breach of or omits to observe
      any of its obligations or undertakings (including, without limitation, any
      financial covenant) expressed to be assumed by it under this Facility
      Letter and, in respect of any such breach or omission which in the opinion
      of the Lender is capable of remedy, such action as the Lender may require
      shall not have been taken within fourteen (14) days of the Lender
      notifying the Borrower of such default and of such required action;
      or

            

    

     

     

    
      
         

      

      
        7

        
          

        

      

      
         

      

    

    
 

    
      	 
      	 
      	
              22.1.3

            	
              Misrepresentation: any
      representation or warranty made or deemed to be made or repeated by or in
      respect of the Borrower in or pursuant this Facility Letter or in any
      notice, certificate or statement referred to in or delivered
      under  this Facility Letter is or proves to have been incorrect
      or misleading in any material respect; or

            
	 
      	 
      	 
      	 
      
	 
      	 
      	
              22.1.4

            	
              Cross-default: any
      indebtedness of the Borrower is not paid when due or any indebtedness of
      the Borrower becomes (whether by declaration or automatically in
      accordance with the relevant agreement or instrument constituting the
      same) due and payable prior to the date when it would otherwise have
      become due (unless as a result of the exercise by the Borrower of a
      voluntary right of prepayment), or any creditor of the Borrower becomes
      entitled to declare any such indebtedness due and payable or any facility
      or commitment available to the Borrower relating to indebtedness is
      withdrawn, suspended or cancelled by reason of any default (however
      described) of the person concerned unless the Borrower shall have
      satisfied the Lender that such withdrawal, suspension or cancellation will
      not affect or prejudice in any way the Borrower’s ability to pay its debts
      as they fall due and fund its commitments, or any guarantee given by the
      Borrower in respect of indebtedness is not honoured when due and called
      upon; or

            
	 
      	 
      	 
      	 
      
	 
      	 
      	
              22.1.5

            	
              Legal process: any
      judgment or order made against the Borrower is not stayed or complied with
      within seven (7) days or a creditor attaches or takes possession of, or a
      distress, execution, sequestration or other process is levied or enforced
      upon or sued out against, any of the undertakings, assets, rights or
      revenues of the Borrower and is not discharged within seven (7) days;
      or

            
	 
      	 
      	 
      	 
      
	 
      	 
      	
              22.1.6

            	
              Insolvency: the Borrower
      or any Owner is unable or admits inability to pay its debts as they fall
      due; suspends making payments on any of its debts or announces an
      intention to do so;  becomes insolvent;  has assets
      the value of which is less than the value of its liabilities (taking into
      account contingent and prospective liabilities); or suffers the
      declaration of a moratorium in respect of any of its
      indebtedness;  or

            

    

     

     

    
      
         

      

      
        8

        
          

        

      

      
         

      

    

    
 

    
      	 
      	 
      	
              22.1.7

            	
              Reduction or loss of
      capital: a meeting is convened by the Borrower for the purpose of
      passing any resolution to purchase, reduce or redeem any of its share
      capital; or

            
	 
      	 
      	 
      	 
      
	 
      	 
      	
              22.1.8

            	
              Winding up: any
      corporate action, legal proceedings or other procedure or step is taken
      for the purpose of winding up the Borrower or an order is made or
      resolution passed for the winding up of the Borrower or a notice is issued
      convening a meeting for the purpose of passing any such resolution;
      or

            
	 
      	 
      	 
      	 
      
	 
      	 
      	
              22.1.9

            	
              Administration: any
      petition is presented, notice given or other step is taken for the purpose
      of the appointment of an administrator of the Borrower and/or the Lender
      believes that any such petition or other step is imminent or an
      administration order is made in relation to the Borrower;
    or

            
	 
      	 
      	 
      	 
      
	 
      	 
      	
              22.1.10

            	
              Appointment of receivers and
      managers: any administrative or other receiver is appointed of the
      Borrower or any part of its assets and/or undertaking or any other steps
      are taken to enforce any encumbrance over all or any part of the assets of
      the Borrower; or

            
	 
      	 
      	 
      	 
      
	 
      	 
      	
              22.1.11

            	
              Compositions: any
      corporate action, legal proceedings or other procedures or steps are
      taken, or negotiations commenced, by the Borrower or by any of its
      creditors with a view to the general readjustment or rescheduling of all
      or part of its indebtedness or to proposing any kind of composition,
      compromise or arrangement involving such company and any of its creditors;
      or

            
	 
      	 
      	 
      	 
      
	 
      	 
      	
              22.1.12

            	
              Analogous proceedings:
      there occurs, in relation to the Borrower, in any country or territory in
      which it carries on business or to the jurisdiction of whose courts any
      part of their assets is subject, any event which, in the reasonable
      opinion of the Lender, appears in that country or territory to correspond
      with, or have an effect equivalent or similar to, any of those mentioned
      in clauses 22.1.5 to 22.1.11 (inclusive) or the Borrower otherwise
      becomes subject, in any such country or territory, to the operation of any
      law relating to insolvency, bankruptcy or liquidation;
  or

            
	 
      	 
      	 
      	 
      
	 
      	 
      	
              22.1.13

            	
              Cessation of business:
      the Borrower suspends or ceases or threatens to suspend or cease to carry
      on its business; or

            

    

     

     

    
      
         

      

      
        9

        
          

        

      

      
         

      

    

    
 

    
      	 
      	 
      	
              22.1.14

            	
              Seizure: all or a
      material part of the undertaking, assets, rights or revenues of, or shares
      or other ownership interests in, the Borrower are seized, nationalised,
      expropriated or compulsorily acquired by or under the authority of any
      government; or

            
	 
      	 
      	 
      	 
      
	 
      	 
      	
              22.1.15

            	
              Disposals: the Borrower
      sells, transfers, abandons, lends or otherwise disposes of or ceases to
      exercise direct control over any part (being either alone or when
      aggregated with all other disposals falling to be taken into account
      pursuant to this clause 22.1.15 material in the opinion of the Banks
      in relation to the undertakings, assets, rights and revenues of the
      Borrower’s Group) of its present or future undertakings, assets, rights or
      revenues (otherwise than by transfers, sales or disposals for full
      consideration in the ordinary course of trading) whether by one or a
      series of transactions related or not; or

            
	 
      	 
      	 
      	 
      
	 
      	 
      	
              22.1.16

            	
              Invalidity: this
      Facility Letter shall at any time and for any reason become invalid or
      unenforceable or otherwise cease to remain in full force and effect, or if
      the validity or enforceability of this Facility Letter shall at any time
      and for any reason be contested by the Borrower, or if the Borrower shall
      deny that it has any, or any further, liability thereunder;
    or

            
	 
      	 
      	 
      	 
      
	 
      	 
      	
              22.1.17

            	
              Unlawfulness: it becomes
      impossible or unlawful at any time for the Borrower, to fulfil any of the
      covenants and obligations expressed to be assumed by it in this Facility
      Letter or for the Lender to exercise the rights or any of them vested in
      them under this Facility Letter or otherwise; or

            
	 
      	 
      	 
      	 
      
	 
      	 
      	
              22.1.18

            	
              Repudiation: the
      Borrower repudiates this Facility Letter or does or causes or permits to
      be done any act or thing evidencing an intention to repudiate this
      Facility Letter; or

            
	 
      	 
      	 
      	 
      
	 
      	 
      	
              22.1.19

            	
              Encumbrances
      enforceable: any Encumbrance (other than Permitted Liens) in
      respect of any of the property (or part thereof) of the Borrower becomes
      enforceable; or

            
	 
      	 
      	 
      	 
      
	 
      	 
      	
              22.1.20

            	
              Material adverse change:
      there occurs, in the opinion of the Lender, a material adverse change in
      the financial condition of the Borrower as described by the Borrower to
      the Lender in the negotiation of this Facility Letter;
  or

            
	 
      	 
      	 
      	 
      
	 
      	 
      	
              22.1.21

            	
              Loan Agreement default:
      an Event of Default (as such term is defined therein) occurs under the
      Loan Agreement; or

            

    

     

     

    
      
         

      

      
        10

        
          

        

      

      
         

      

    

    
 

    
      	 
      	 
      	
              22.1.22

            	
              Material events: any
      other event occurs or circumstance arises which, in the opinion of the
      Lender, is likely materially and adversely to affect  the
      ability of the Borrower to perform all or any of its obligations under or
      otherwise to comply with the terms this facility
letter.

            
	 
      	 
      	 
      
	 
      	
              22.2

            	
              Acceleration   If
      an Event of Default is continuing the Lender may by notice to the
      Borrower:

            
	 
      	 
      	 
      	 
      
	 
      	 
      	
              22.2.1

            	
              declare
      that the Loan, together with accrued interest, and all other amounts
      accrued or outstanding under this Facility Letter are immediately due and
      payable, whereupon they shall become immediately due and payable;
      and/or

            
	 
      	 
      	 
      	 
      
	 
      	 
      	
              22.2.2

            	
              declare
      that the Loan is payable on demand, whereupon it shall immediately become
      payable on demand by the Lender.

            

    

    

    
      	
              23.

            	
              Notices
      and Correspondence

            
	 
      	 
      	 
      	 
      
	 
      	
              All
      notices and correspondence to the Lender shall  (unless notified
      to the contrary) be sent to HSH Nordbank AG, Attn: Shipping, Greek
      Clients, Gerhart-Hauptmann-Platz 50, 20095 Hamburg,  (Fax No:
      +49 40 33363 34118).

            
	 
      	 
      	 
      	 
      
	 
      	
              All
      notices and correspondence to the Borrower shall (unless notified to the
      contrary) be sent to  Omega Navigation Enterprises, Inc., 24,
      Kanigos St. Kastella 18534 Piraeus Greece (Fax No: + 30 210 422 2541
      /2542).

            
	 
      	 
      	 
      	 
      
	
              24.

            	
              Counterparts

            
	 
      	 
      	 
      	 
      
	 
      	
              This
      Facility Letter may be executed in any number of counterparts each of
      which shall be original but which shall together constitute the same
      instrument.

            
	 
      	 
      	 
      	 
      
	
              25.

            	
              Governing
      Law and Jurisdiction

            
	 
      	 
      	 
      	 
      
	 
      	
              This
      Facility Letter will be governed by and construed in accordance with
      English law and for the benefit of the Lender the Borrower hereby submits
      to the non-exclusive jurisdiction of the courts of England.  The
      Borrower hereby irrevocably authorises and appoints Hill Taylor Dickinson
      at present of Irongate House, Duke’s Place, London EC3A 7HX as its agent
      to accept service of any legal proceedings arising out of or in connection
      with this Facility Letter.

            

    

    

     

    
      
         

      

      
        11

        
          

        

      

      
         

      

    

    

    

    To
signify your agreement to the above terms and conditions, kindly sign and return
to us the attached copy of this letter.

    

    Yours
faithfully,

    

    HSH
Nordbank AG

    

    

    

    Accepted
and signed
this               day
of                                        2007

    

    OMEGA
NAVIGATION ENTERPRISES INC.

    

    By

         Attorney-in-Fact

    

SK 23286 0002 889264

    
      
        
           

        

         

      

      
        12

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00143-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00143-of-00352.parquet"}]]