Document:

ULTRAPETROL (BAHAMAS) LIMITED
                            2006 STOCK INCENTIVE PLAN

                                   ARTICLE I.
                                     GENERAL

1.1.  PURPOSE

      The Ultrapetrol (Bahamas) Limited 2006 Stock Incentive Plan (the "Plan")
is designed to provide certain key persons, on whose initiative and efforts the
successful conduct of the business of Ultrapetrol (Bahamas) Limited (the
"Company") depends, with incentives to: (a) enter into and remain in the service
of the Company (b) acquire a proprietary interest in the success of the Company,
(c) maximize their performance and (d) enhance the long-term performance of the
Company.

1.2.  ADMINISTRATION

      (a)   Administration by Board of Directors. The Plan shall be administered
by the Company's Board of Directors (the "Administrator"), which shall act at
all times so as to avoid inclusion of any amount in gross income pursuant to
Section 409A of the Code. The Administrator shall have the authority (i) to
exercise all of the powers granted to it under the Plan, (ii) to construe,
interpret and implement the Plan and any Award Agreements executed pursuant to
Section 2.1 in its sole discretion with all such determinations being final,
binding and conclusive, (iii) to prescribe, amend and rescind rules and
regulations relating to the Plan, including rules governing its own operations,
(iv) to make all determinations necessary or advisable in administering the
Plan, and (v) to correct any defect, supply any omission and reconcile any
inconsistency in the Plan.

      (b)   Administrator Action. Actions of the Administrator shall be taken by
the vote of a majority of its members. Any action may be taken by a written
instrument signed by a majority of the Administrator members, and action so
taken shall be fully as effective as if it had been taken by a vote at a
meeting. Except to the extent prohibited by applicable law or the applicable
rules of a stock exchange, the Administrator may allocate all or any portion of
its responsibilities and powers to any one or more of its members and may
delegate all or any part of its responsibilities to any person or persons
selected by it, and may revoke any such allocation or delegation at any time.

1.3.  PERSONS ELIGIBLE FOR AWARDS

      The persons eligible to receive awards under the Plan are those officers,
directors, and executive, managerial, administrative and professional employees
of, and consultants to, the Company, (collectively, "key persons") as the
Administrator in its sole discretion shall select, taking into account the
duties of the respective employees, their present and potential contributions to
the success of the Company, and such other factors as the Administrator shall
deem relevant in connection with accomplishing the purpose of the Plan. The
Administrator may from time to time, in its sole discretion, determine that any
key person shall be ineligible to receive awards under the Plan.

                                        1

1.4.  TYPES OF AWARDS UNDER PLAN

      Awards may be made under the Plan in the form of (a) stock options, (b)
stock appreciation rights, (c) dividend equivalent rights, (d) restricted stock,
(e) unrestricted stock, (f) restricted stock units, and (g) performance shares,
all as more fully set forth in Article II. The term "award" means any of the
foregoing.

1.5.  SHARES AVAILABLE FOR AWARDS

      (a)   Subject to the provisions of Section 1.5(b), the aggregate number of
shares of common stock of the Company ("Common Stock") with respect to which
options or restricted shares may at any time be granted under the Plan shall not
exceed five percent of the authorized shares of the Company's Common Stock
immediately after giving effect to the Company's initial public equity offering.

      (b)   Shares issued pursuant to the Plan may be authorized but unissued
Common Stock. The Administrator may direct that any stock certificate evidencing
shares issued pursuant to the Plan shall bear a legend setting forth such
restrictions on transferability as may apply to such shares.

      (c)   Adjustment Upon Changes in Common Stock. Upon certain changes in
Common Stock, the number of shares of Common Stock available for issuance with
respect to awards that may be granted under the Plan pursuant to Section 1.5(a),
shall be adjusted pursuant to Section 3.5(a).

      (d)   Certain Shares to Become Available Again. The following shares of
Common Stock shall again become available for awards under the Plan: any shares
that are subject to an award under the Plan and that remain unissued upon the
cancellation or termination of such award for any reason whatsoever; any shares
of restricted stock forfeited pursuant to Section 2.7(e), provided that any
dividends paid on such shares are also forfeited pursuant to such Section
2.7(e); and any shares in respect of which a stock appreciation right or
performance share award is settled for cash.

1.6.  DEFINITIONS OF CERTAIN TERMS

      (a)   The "Fair Market Value" of a share of Common Stock on any day shall
be the closing price on the Nasdaq National Market as reported for such day in
The Wall Street Journal or, if no such price is reported for such day, the
average of the high bid and low asked price of Common Stock as reported for such
day. If no quotation is made for the applicable day, the Fair Market Value of a
share of Common Stock on such day shall be determined in the manner set forth in
the preceding sentence using quotations for the next preceding day for which
there were quotations, provided that such quotations shall have been made within
the ten (10) business days preceding the applicable day. Notwithstanding the
foregoing, if deemed necessary or appropriate by the Administrator, the Fair
Market Value of a share of Common Stock on any day shall be determined by the
Administrator based on independent pricing sources.

      (b)   The term "cause" in connection with a termination of employment or
Board membership by reason of a dismissal for cause shall mean:

            (i)   to the extent that there is an employment, severance or other
      agreement governing the relationship between the grantee and the Company,
      a Company subsidiary or a Company joint venture, which agreement contains
      a definition of "cause," cause shall consist of those acts or omissions
      that would constitute "cause" under such agreement; and otherwise,

            (ii)  the grantee's termination of employment or Board membership by
      the Company or an affiliate on account of any one or more of the
      following:

                  (A)   any failure by the grantee substantially to perform the
            grantee's employment or Board membership duties;

                  (B)   any excessive unauthorized absenteeism by the grantee;

                  (C)   any refusal by the grantee to obey the lawful orders of
            the Board or any other person or Administrator to whom the grantee
            reports;

                  (D)   any act or omission by the grantee that is or may be
            injurious to the Company, monetarily or otherwise;

                  (E)   any act by the grantee that is inconsistent with the
            best interests of the Company;

                  (F)   the grantee's material violation of any of the Company's
            policies, including, without limitation, those policies relating to
            discrimination or sexual harassment;

                  (G)   the grantee's unauthorized (a) removal from the premises
            of the Company or an affiliate of any document (in any medium or
            form) relating to the Company or an affiliate or the customers or
            clients of the Company or an affiliate or (b) disclosure to any
            person or entity of any of the Company's, or its affiliates'
            confidential or proprietary information;

                  (H)   the grantee's commission of any felony, or any other
            crime involving moral turpitude; and

                  (I)   the grantee's commission of any act involving dishonesty
            or fraud.

      Any rights the Company may have hereunder in respect of the events giving
rise to cause shall be in addition to the rights the Company may have under any
other agreement with a grantee or at law or in equity. Any determination of
whether a grantee's employment or Board membership is (or is deemed to have
been) terminated for cause shall be made by the Administrator in its discretion,
which determination shall be final, binding and conclusive on all parties. If,
subsequent to a grantee's voluntary termination of employment or involuntary
termination of employment without cause, it is discovered that the grantee's
employment could have been terminated for cause, the Administrator may deem such
grantee's employment or Board membership to have been terminated for cause. A
grantee's termination of employment or Board membership for cause shall be
effective as of the date of the occurrence of the event giving rise to cause,
regardless of when the determination of cause is made.

                                   ARTICLE II.
                              AWARDS UNDER THE PLAN

2.1.  AGREEMENTS EVIDENCING AWARDS

      Each award granted under the Plan (except an award of unrestricted stock)
shall be evidenced by a written certificate ("Award Agreement") which shall
contain such provisions as the Administrator may, in its sole discretion, deem
necessary or desirable. By executing an Award Agreement pursuant to the Plan, a
grantee thereby agrees that the award shall be subject to all of the terms and
provisions of the Plan and the applicable Award Agreement.

2.2.  GRANT OF STOCK OPTIONS, STOCK APPRECIATION RIGHTS, RESTRICTED STOCK UNITS
AND DIVIDEND EQUIVALENT RIGHTS

      (a)   Stock Option Grants. The Administrator may grant stock options
("options") to purchase shares of Common Stock from the Company, to such key
persons, and in such amounts and subject to such vesting and forfeiture
provisions and other terms and conditions, as the Administrator shall determine,
in its sole discretion, subject to the provisions of the Plan.

      (b)   Stock Appreciation Right Grants; Types of Stock Appreciation Rights.
The Administrator may grant stock appreciation rights to such key persons, and
in such amounts and subject to such vesting and forfeiture provisions and other
terms and conditions, as the Administrator shall determine, in its sole
discretion, subject to the provisions of the Plan. The terms of a stock
appreciation right may provide that it shall be automatically exercised for a
cash payment upon the happening of a specified event that is outside the control
of the grantee, and that it shall not be otherwise exercisable. Stock
appreciation rights may be granted in connection with all or any part of, or
independently of, any option granted under the Plan. A stock appreciation right
granted in connection with an option may be granted at or after the time of
grant of such option.

      (c)   Nature of Stock Appreciation Rights. The grantee of a stock
appreciation right shall have the right, subject to the terms of the Plan and
the applicable Award Agreement, to receive from the Company an amount equal to
(i) the excess of the Fair Market Value of a share of Common Stock on the date
of exercise of the stock appreciation right over the Fair Market Value of a
share of Common Stock on the date of grant (or over the option exercise price if
the stock appreciation right is granted in connection with an option),
multiplied by (ii) the number of shares with respect to which the stock
appreciation right is exercised. Payment upon exercise of a stock appreciation
right shall be in cash or in shares of Common Stock (valued at their Fair Market
Value on the date of exercise of the stock appreciation right) or both, all as
the Administrator shall determine in its sole discretion. Upon the exercise of a
stock appreciation right granted in connection with an option, the number of
shares subject to the option shall be reduced by the number of shares with
respect to which the stock appreciation right is exercised. Upon the exercise of
an option in connection with which a stock appreciation right has been granted,
the number of shares subject to the stock appreciation right shall be reduced by
the number of shares with respect to which the option is exercised.

      (d)   Option Exercise Price. Each Award Agreement with respect to an
option shall set forth the amount (the "option exercise price") payable by the
grantee to the Company upon exercise of the option evidenced thereby. The option
exercise price per share shall be

determined by the Administrator in its sole discretion and in accordance with
the requirements of Section 409A of the Code; provided, however, that in no
event shall the option exercise price be less than the par value of a share of
Common Stock.

      (e)   Exercise Period. Each Award Agreement with respect to an option or
stock appreciation right shall set forth the periods during which the award
evidenced thereby shall be exercisable, whether in whole or in part. Such
periods shall be determined by the Administrator in its sole discretion;
provided, however, that no option or a stock appreciation right shall be
exercisable more than 10 years after the date of grant, and provided further
that, except as and to the extent that the Administrator may otherwise provide
pursuant to Sections 2.5, 3.7 or 3.8, no option or stock appreciation right
shall be exercisable prior to the first anniversary of the date of grant. (See
the default exercise period provided for under Sections 2.3(a) and (b).)

      (f)   Reload Options. The Administrator may, in its sole discretion,
include in any Award Agreement with respect to an option (the "original option")
a provision that an additional option (the "reload option") shall be granted to
any grantee who, pursuant to Section 2.3(e)(ii), delivers shares of Common Stock
in partial or full payment of the exercise price of the original option. The
reload option shall be for a number of shares of Common Stock equal to the
number thus delivered, shall have an exercise price equal to the Fair Market
Value of a share of Common Stock on the date of exercise of the original option,
and shall have an expiration date no later than the expiration date of the
original option. In the event that an Award Agreement provides for the grant of
a reload option, such Agreement shall also provide that the exercise price of
the original option be no less than the Fair Market Value of a share of Common
Stock on its date of grant, and that any shares that are delivered pursuant to
Section 2.3(e)(ii) in payment of such exercise price shall have been held for at
least six months.

      (g)   Dividend Equivalent Rights. The Administrator may, in its sole
discretion and subject to the requirements of Section 409A of the Code, include
in any Award Agreement with respect to an option, stock appreciation right or
performance shares, a dividend equivalent right entitling the grantee to receive
amounts equal to the ordinary dividends that would be paid, during the time such
award is outstanding and unexercised, on the shares of Common Stock covered by
such award if such shares were then outstanding. In the event such a provision
is included in an Award Agreement, the Administrator shall determine whether
such payments shall be made in cash or in shares of Common Stock, whether they
shall be conditioned upon the exercise of the award to which they relate, the
time or times at which they shall be made, and such other vesting and forfeiture
provisions and other terms and conditions as the Administrator shall deem
appropriate.

      (h)   Restricted Stock Units. The Administrator may, in its sole
discretion, grant restricted stock units to such key persons, and in such
amounts and subject to such vesting and forfeiture provisions and other terms
and conditions, as the Administrator shall determine, in its sole discretion,
subject to the provisions of the Plan. A restricted stock unit granted under the
Plan shall confer upon the grantee a right to receive from the Company, upon the
occurrence of an event specified in the Award Agreement, such grantee's vested
restricted stock units multiplied by the Fair Market Value of a share of Common
Stock. Restricted stock units may be granted in connection with all or any part
of, or independently of, any award granted under the Plan. A restricted stock
unit granted in connection with another award may be granted at or after the
time of grant of such award.

2.3.  EXERCISE OF OPTIONS, STOCK APPRECIATION RIGHTS AND RESTRICTED STOCK UNITS

      Subject to the other provisions of this Article II, each option, stock
appreciation right and restricted stock unit granted under the Plan shall be
exercisable as follows:

      (a)   Timing and Extent of Exercise. Options, stock appreciation rights
and rights with respect to restricted stock units shall be exercisable at such
times and under such conditions as set forth in the corresponding Award
Agreement, but in no event shall any such award be exercisable prior to the
first anniversary or subsequent to the tenth anniversary of the date on which
such award was granted. Unless the applicable Award Agreement otherwise
provides, an option, stock appreciation right or rights with respect to
restricted stock unit may be exercised from time to time as to all or part of
the shares or units as to which such award is then exercisable. A stock
appreciation right granted in connection with an option may be exercised at any
time when, and to the same extent that, the related option may be exercised.

      (b)   Notice of Exercise. An option, stock appreciation right or rights
with respect to restricted stock unit shall be exercised by the filing of a
written notice with the Company or the Company's designated exchange agent (the
"exchange agent"), on such form and in such manner as the Administrator shall in
its sole discretion prescribe.

      (c)   Payment of Exercise Price. Any written notice of exercise of an
option shall be accompanied by payment for the shares being purchased. Such
payment shall be made: (i) by certified or official bank check (or the
equivalent thereof acceptable to the Company or its exchange agent) for the full
option exercise price; or (ii) with the consent of the Administrator, by
delivery of shares of Common Stock having a Fair Market Value (determined as of
the exercise date) equal to all or part of the option exercise price and a
certified or official bank check (or the equivalent thereof acceptable to the
Company or its exchange agent) for any remaining portion of the full option
exercise price; or (iii) at the discretion of the Administrator and to the
extent permitted by law, by such other provision, consistent with the terms of
the Plan, as the Administrator may from time to time prescribe (whether directly
or indirectly through the exchange agent).

      (d)   Delivery of Certificates Upon Exercise. Subject to the provision of
section 2.3(e), promptly after receiving payment of the full option exercise
price, or after receiving notice of the exercise of a stock appreciation right
for which payment will be made partly or entirely in shares, the Company or its
exchange agent shall (i) deliver to the grantee or to such other person as may
then have the right to exercise the award, a certificate or certificates for the
shares of Common Stock for which the award has been exercised; or (ii) establish
an account evidencing ownership of the stock in uncertificated form. If the
method of payment employed upon option exercise so requires, and if applicable
law permits, an optionee may direct the Company or its exchange agent, as the
case may be, to deliver the stock certificate(s) to the optionee's stockbroker.

      (e)   Investment Purpose and Legal Requirements. Notwithstanding the
foregoing, at the time of the exercise of any option, the Company may, if it
shall deem it necessary or advisable for any reason, require the holder of such
option (i) to represent in writing to the Company that it is the optionee's then
intention to acquire the Shares with respect to which the option is to be
exercised for investment and not with a view to the distribution thereof, or
(ii) to postpone the date of exercise until such time as the Company has
available for delivery to the

optionee a prospectus meeting the requirements of all applicable securities
laws; and no shares shall be issued or transferred upon the exercise of any
option unless and until all legal requirements applicable to the issuance or
transfer of such Shares have been complied with to the satisfaction of the
Company. The Company shall have the right to condition any issuance of shares to
any optionee hereunder on such optionee's undertaking in writing to comply with
such restrictions on the subsequent transfer of such shares as the Company shall
deem necessary or advisable as a result of any applicable law, regulation or
official interpretation thereof, and certificates representing such shares may
contain a legend to reflect any such restrictions.

      (f)   No Stockholder Rights. No grantee of an option, stock appreciation
right or restricted stock unit (or other person having the right to exercise
such award) shall have any of the rights of a stockholder of the Company with
respect to shares subject to such award until the issuance of a stock
certificate to such person for such shares. Except as otherwise provided in
Section 1.5(b), no adjustment shall be made for dividends, distributions or
other rights (whether ordinary or extraordinary, and whether in cash, securities
or other property) for which the record date is prior to the date such stock
certificate is issued.

2.4.  COMPENSATION IN LIEU OF EXERCISE OF AN OPTION

      Upon written application of the grantee of an option, the Administrator
may in its sole discretion determine to substitute, for the exercise of such
option, compensation to the grantee not in excess of the difference between the
option exercise price and the Fair Market Value of the shares covered by such
written application on the date of such application. Such compensation may be in
cash, in shares of Common Stock, or both, and the payment thereof may be subject
to conditions, all as the Administrator shall determine in its sole discretion.
In the event compensation is substituted pursuant to this Section 2.4 for the
exercise, in whole or in part, of an option, the number of shares subject to the
option shall be reduced by the number of shares for which such compensation is
substituted.

2.5.  TERMINATION OF EMPLOYMENT; DEATH SUBSEQUENT TO A TERMINATION OF EMPLOYMENT

      (a)   General Rule. Except to the extent otherwise provided in paragraphs
(b), (c), (d) or (e) of this Section 2.5 or Section 3.6(b)(iii), a grantee who
incurs a termination of employment may exercise any outstanding option or stock
appreciation right on the following terms and conditions: (i) exercise may be
made only to the extent that the grantee was entitled to exercise the award on
the termination of employment date; and (ii) exercise must occur within three
months after termination of employment but in no event after the original
expiration date of the award.

      (b)   Dismissal for Cause; Resignation. If a grantee incurs a termination
of employment as the result of a dismissal for cause or resignation without the
Company's prior consent, as applicable, all options, stock appreciation and
restricted stock units rights not theretofore exercised shall terminate upon the
grantee's termination of employment.

      (c)   Retirement. If a grantee incurs a termination of employment as the
result of his retirement, then any outstanding option, stock appreciation right
or restricted stock unit shall be exercisable pursuant to its terms. For this
purpose "retirement" shall mean a grantee's termination of employment, under
circumstances other than those described in paragraph (b) above, on or after:
(x) his 65th birthday, (y) the date on which he has attained age 60 and

completed at least five years of service with the Company, as applicable, (using
any method of calculation the Administrator deems appropriate) or (z) if
approved by the Administrator, on or after he has completed at least 20 years of
service.

      (d)   Disability. If a grantee incurs a termination of employment by
reason of a disability (as defined below), then any outstanding option, stock
appreciation right or restricted stock unit shall be exercisable pursuant to its
terms. For this purpose "disability" shall mean, except in connection with any
physical or mental condition that would qualify a grantee for a disability
benefit under the long-term disability plan maintained by the Company, if there
is no such plan, a physical or mental condition that prevents the grantee from
performing the essential functions of the grantee's position (with or without
reasonable accommodation) for a period of six consecutive months. The existence
of a disability shall be determined by the Administrator in its sole and
absolute discretion.

      (e)   Death.

                  (i)   Termination of Employment as a Result of Grantee's
      Death. If a grantee incurs a termination of employment as the result of
      his death, then any outstanding option, stock appreciation right or
      restricted stock unit shall be exercisable pursuant to its terms.

                  (ii)  Restrictions on Exercise Following Death. Any such
      exercise of an award following a grantee's death shall be made only by the
      grantee's executor or administrator or other duly appointed representative
      reasonably acceptable to the Administrator, unless the grantee's will
      specifically disposes of such award, in which case such exercise shall be
      made only by the recipient of such specific disposition. If a grantee's
      personal representative or the recipient of a specific disposition under
      the grantee's will shall be entitled to exercise any award pursuant to the
      preceding sentence, such representative or recipient shall be bound by all
      the terms and conditions of the Plan and the applicable Award Agreement
      which would have applied to the grantee including, without limitation, the
      provisions of Sections 3.2 and 3.5 hereof.

      (f)   Administrator Discretion. The Administrator, in the applicable Award
Agreement, may waive or modify the application of the foregoing provisions of
this Section 2.5 to the extent such waiver or modification is consistent with
favorable tax treatment of amounts payable hereunder.

2.6.  TRANSFERABILITY OF OPTIONS, STOCK APPRECIATION RIGHTS AND RESTRICTED STOCK
UNITS

      Except as otherwise provided in an applicable Award Agreement evidencing
an option, stock appreciation right or restricted stock unit, during the
lifetime of a grantee, each such award granted to a grantee shall be exercisable
only by the grantee and no such award shall be assignable or transferable
otherwise than by will or by the laws of descent and distribution. The
Administrator may, in any applicable Award Agreement evidencing an option,
permit a grantee to transfer all or some of the options to (A) the grantee's
spouse, children or grandchildren ("Immediate Family Members"), (B) a trust or
trusts for the exclusive benefit of such Immediate Family Members, or (C) other
parties approved by the Administrator in its sole and absolute discretion.
Following any such transfer, any transferred options shall

continue to be subject to the same terms and conditions as were applicable
immediately prior to the transfer.

2.7.  GRANT OF RESTRICTED STOCK

      (a)   Restricted Stock Grants. The Administrator may grant restricted
shares of Common Stock to such key persons, in such amounts, and subject to such
vesting and forfeiture provisions and other terms and conditions as the
Administrator shall determine in its sole discretion, subject to the provisions
of the Plan. Restricted stock awards may be made independently of or in
connection with any other award under the Plan. A grantee of a restricted stock
award shall have no rights with respect to such award unless such grantee
accepts the award within such period as the Administrator shall specify by
accepting delivery of a restricted stock agreement in such form as the
Administrator shall determine and, in the event the restricted shares are newly
issued by the Company, makes payment to the Company its exchange agent by
certified or official bank check (or the equivalent thereof acceptable to the
Company) in an amount at least equal to the par value of the shares covered by
the award.

      (b)   Issuance of Stock Certificate(s). Promptly after a grantee accepts a
restricted stock award, the Company or its exchange agent shall issue to the
grantee a stock certificate or stock certificates for the shares of Common Stock
covered by the award or shall establish an account evidencing ownership of the
stock in uncertificated form. Upon the issuance of such stock certificate(s), or
establishment of such account, the grantee shall have the rights of a
stockholder with respect to the restricted stock, subject to: (i) the
nontransferability restrictions and forfeiture provision described in paragraphs
(d) and (e) of this Section 2.7; (ii) in the Administrator's discretion, to a
requirement that any dividends paid on such shares shall be held in escrow until
all restrictions on such shares have lapsed; and (iii) any other restrictions
and conditions contained in the applicable restricted stock agreement.

      (c)   Custody of Stock Certificate(s). Unless the Administrator shall
otherwise determine, any stock certificates issued evidencing shares of
restricted stock shall remain in the possession of the Company until such shares
are free of any restrictions specified in the applicable restricted stock
agreement. The Administrator may direct that such stock certificate(s) bear a
legend setting forth the applicable restrictions on transferability.

      (d)   Nontransferability. Shares of restricted stock may not be sold,
assigned, transferred, pledged or otherwise encumbered or disposed of except as
otherwise specifically provided in this Plan or the applicable restricted stock
agreement. The Administrator at the time of grant shall specify the date or
dates (which may depend upon or be related to the attainment of performance
goals and other conditions) on which the nontransferability of the restricted
stock shall lapse.

      (e)   Consequence of Termination of Employment or Consultancy. A grantee's
termination of employment or consultancy for any reason (including death in the
case of an employee) shall cause the immediate forfeiture of all shares of
restricted stock that have not yet vested as of the date of such termination of
employment.

2.8.  GRANT OF UNRESTRICTED STOCK

      The Administrator may grant (or sell at a purchase price at least equal to
par value) shares of Common Stock free of restrictions under the Plan, to such
key persons and in such amounts

as the Administrator shall determine in its sole discretion. Shares may be thus
granted or sold in respect of past services or other valid consideration.

2.9.  GRANT OF PERFORMANCE SHARES

      (a)   Performance Share Grants. The Administrator may grant performance
share awards to such key persons, and in such amounts and subject to such
vesting and forfeiture provisions and other terms and conditions, as the
Administrator shall in its sole discretion determine, subject to the provisions
of the Plan. Such an award shall entitle the grantee to acquire shares of Common
Stock, or to be paid the value thereof in cash, as the Administrator shall
determine, if specified performance goals are met. Performance shares may be
awarded independently of, or in connection with, any other award under the Plan.
A grantee shall have no rights with respect to a performance share award unless
such grantee accepts the award by accepting delivery of an Award Agreement at
such time and in such form as the Administrator shall determine.

      (b)   Stockholder Rights. The grantee of a performance share award will
have the rights of a stockholder only as to shares for which a stock certificate
has been issued pursuant to the award and not with respect to any other shares
subject to the award.

      (c)   Consequence of Termination of Employment or Consultancy. Except as
may otherwise be provided by the Administrator at any time prior to a grantee's
termination of employment, the rights of a grantee of a performance share award
shall automatically terminate upon the grantee's termination of employment or
consultancy by the Company or its subsidiaries for any reason (including death
in the case of an employee).

      (d)   Exercise Procedures; Automatic Exercise. At the discretion of the
Administrator, the applicable Award Agreement may set out the procedures to be
followed in exercising a performance share award or it may provide that such
exercise shall be made automatically after satisfaction of the applicable
performance goals.

      (e)   Tandem Grants; Effect on Exercise. Except as otherwise specified by
the Administrator, (i) a performance share award granted in tandem with an
option may be exercised only while the option is exercisable, (ii) the exercise
of a performance share award granted in tandem with any other award shall reduce
the number of shares subject to such other award in the manner specified in the
applicable Award Agreement, and (iii) the exercise of any award granted in
tandem with a performance share award shall reduce the number of shares subject
to the latter in the manner specified in the applicable Award Agreement.

      (f)   Nontransferability. Performance shares may not be sold, assigned,
transferred, pledged or otherwise encumbered or disposed of except as otherwise
specifically provided in this Plan or the applicable Award Agreement. The
Administrator at the time of grant shall specify the date or dates (which may
depend upon or be related to the attainment of performance goals and other
conditions) on which the nontransferability of the performance shares shall
lapse.

                                  ARTICLE III.
                                  MISCELLANEOUS

3.1.  AMENDMENT OF THE PLAN; MODIFICATION OF AWARDS

      (a)   Amendment of the Plan. The Board may from time to time suspend,
discontinue, revise or amend the Plan in any respect whatsoever, except that no
such amendment shall materially impair any rights or materially increase any
obligations under any award theretofore made under the Plan without the consent
of the grantee (or, upon the grantee's death, the person having the right to
exercise the award). For purposes of this Section 3.1, any action of the Board
or the Administrator that in any way alters or affects the tax treatment of any
award shall not be considered to materially impair any rights of any grantee.

      (b)   Stockholder Approval Requirement. Stockholder approval shall be
required with respect to any amendment to the Plan that materially increases the
benefits under the Plan to persons whose transactions in Common Stock are
subject to section 16(b) of the 1934 Act or increases the benefits under the
Plan to someone who is, materially increases the number of shares which may be
issued to such persons, or materially modifies the eligibility requirements
affecting such persons.

      (c)   Modification of Awards. The Administrator may cancel any award under
the Plan. Subject to the requirements of Section 409A of the Code, the
Administrator also may amend any outstanding Award Agreement, including, without
limitation, by amendment which would: (i) accelerate the time or times at which
the award becomes unrestricted or may be exercised, provided that, except as and
to the extent that the Administrator may otherwise provide pursuant to Section
2.5, 3.7 or 3.8, no option, stock appreciation right or restricted stock unit
shall be exercisable prior to the first anniversary of its date of grant; (ii)
waive or amend any goals, restrictions or conditions set forth in the Agreement;
or (iii) waive or amend the operation of Section 2.5 with respect to the
termination of the award upon termination of employment. However, any such
cancellation or amendment (other than an amendment pursuant to Sections 3.7 or
3.8(b)) that materially impairs the rights or materially increases the
obligations of a grantee under an outstanding award shall be made only with the
consent of the grantee (or, upon the grantee's death, the person having the
right to exercise the award).

3.2.  CONSENT REQUIREMENT

      (a)   No Plan Action Without Required Consent. If the Administrator shall
at any time determine that any Consent (as hereinafter defined) is necessary or
desirable as a condition of, or in connection with, the granting of any award
under the Plan, the issuance or purchase of shares or other rights thereunder,
or the taking of any other action thereunder (each such action being hereinafter
referred to as a "Plan Action"), then such Plan Action shall not be taken, in
whole or in part, unless and until such Consent shall have been effected or
obtained to the full satisfaction of the Administrator.

      (b)   Consent Defined. The term "Consent" as used herein with respect to
any Plan Action means (i) any and all listings, registrations or qualifications
in respect thereof upon any securities exchange or under any federal, state or
local law, rule or regulation, (ii) any and all written agreements and
representations by the grantee with respect to the disposition of shares, or
with respect to any other matter, which the Administrator shall deem necessary
or desirable to

comply with the terms of any such listing, registration or qualification or to
obtain an exemption from the requirement that any such listing, qualification or
registration be made and (iii) any and all consents, clearances and approvals in
respect of a Plan Action by any governmental or other regulatory bodies.

3.3.  NONASSIGNABILITY

      Except as provided in Sections 2.5(e), 2.6, 2.7(d) and 2.9(f): (a) no
award or right granted to any person under the Plan or under any Award Agreement
shall be assignable or transferable other than by will or by the laws of descent
and distribution; and (b) all rights granted under the Plan or any Award
Agreement shall be exercisable during the life of the grantee only by the
grantee or the grantee's legal representative.

3.4.  WITHHOLDING TAXES

      (a)   With Respect to Cash Payments. Whenever cash is to be paid pursuant
to an award under the Plan, the Company shall be entitled to deduct therefrom an
amount sufficient in its opinion to satisfy all federal, state and other
governmental tax withholding requirements related to such payment.

      (b)   With Respect to Delivery of Common Stock. Whenever shares of Common
Stock are to be delivered pursuant to an award under the Plan, the Company shall
be entitled to require as a condition of delivery that the grantee remit to the
Company an amount sufficient in the opinion of the Company to satisfy all
federal, state and other governmental tax withholding requirements related
thereto. With the approval of the Administrator, which the Administrator shall
have sole discretion whether or not to give, the grantee may satisfy the
foregoing condition by electing to have the Company withhold from delivery
shares having a value equal to the amount of tax to be withheld. Such shares
shall be valued at their Fair Market Value as of the date on which the amount of
tax to be withheld is determined. Fractional share amounts shall be settled in
cash. Such a withholding election may be made with respect to all or any portion
of the shares to be delivered pursuant to an award.

3.5.  ADJUSTMENT UPON CHANGES IN COMMON STOCK

      (a)   Shares Available for Grants. In the event of any change in the
number of shares of Common Stock outstanding by reason of any other event or
transaction, the Administrator shall make such adjustments in the number and
class of shares of Common Stock with respect to which awards: (i) may be granted
under Article II hereof and (ii) granted to any one employee of the Company or a
subsidiary during any one calendar year, in each case as the Administrator may
deem appropriate.

      (b)   Outstanding Restricted Stock and Performance Shares. Unless the
Administrator in its sole and absolute discretion otherwise determines, any
securities or other property (including dividends paid in cash) received by a
grantee with respect to a share of restricted stock, the issue date with respect
to which occurs prior to such event, but which has not vested as of the date of
such event, as a result of any dividend, stock split, reverse stock split,
recapitalization, merger, consolidation, combination, exchange of shares or
otherwise will not vest until such share of restricted stock vests, and shall be
promptly deposited with the Company or other custodian designated pursuant to
Section 2.7(c) hereof.

      The Administrator may, in its absolute discretion, adjust any grant of
shares of restricted stock, the issue date with respect to which has not
occurred as of the date of the occurrence of any of the following events, or any
grant of performance shares, to reflect any dividend, stock split, reverse stock
split, recapitalization, merger, consolidation, combination, exchange of shares
or similar corporate change as the Administrator may deem appropriate to prevent
the enlargement or dilution of rights of grantees.

      (c)   Outstanding Options, Stock Appreciation Rights and Dividend
Equivalent Rights--Increase or Decrease in Issued Shares Without Consideration.
Subject to any required action by the stockholders of the Company, in the event
of any increase or decrease in the number of issued shares of Common Stock
resulting from a subdivision or consolidation of shares of Common Stock or the
payment of a stock dividend (but only on the shares of Common Stock), or any
other increase or decrease in the number of such shares effected without receipt
of consideration by the Company, the Administrator shall proportionally adjust
the number of shares of Common Stock subject to each outstanding option and
stock appreciation right, and the exercise price-per-share of Common Stock of
each such option and stock appreciation right and the number of any related
dividend equivalent rights.

      (d)   Outstanding Options, Stock Appreciation Rights, Restricted Stock
Units and Dividend Equivalent Rights--Certain Mergers. Subject to any required
action by the stockholders of the Company, in the event that the Company shall
be the surviving corporation in any merger or consolidation (except a merger or
consolidation as a result of which the holders of shares of Common Stock receive
securities of another corporation), each option, stock appreciation right and
dividend equivalent right outstanding on the date of such merger or
consolidation shall pertain to and apply to the securities which a holder of the
number of shares of Common Stock subject to such option, stock appreciation
right, restricted stock unit or dividend equivalent right would have received in
such merger or consolidation.

      (e)   Outstanding Options, Stock Appreciation Rights, Restricted Stock
Units and Dividend Equivalent Rights--Certain Other Transactions. In the event
of (i) a dissolution or liquidation of the Company, (ii) a sale of all or
substantially all of the Company's assets, (iii) a merger or consolidation
involving the Company in which the Company is not the surviving corporation or
(iv) a merger or consolidation involving the Company in which the Company is the
surviving corporation but the holders of shares of Common Stock receive
securities of another corporation and/or other property, including cash, the
Administrator shall, in its absolute discretion, have the power to:

                  (i)   cancel, effective immediately prior to the occurrence of
      such event, each option, stock appreciation right and restricted stock
      unit (including each dividend equivalent right related thereto)
      outstanding immediately prior to such event (whether or not then
      exercisable), and, in full consideration of such cancellation, pay to the
      grantee to whom such option or stock appreciation right was granted an
      amount in cash, for each share of Common Stock subject to such option or
      stock appreciation right, respectively, equal to the excess of (x) the
      value, as determined by the Administrator in its absolute discretion
      applied in accordance with Section 409A of the Code, of the property
      (including cash) received by the holder of a share of Common Stock as a
      result of such event over (y) the exercise price of such option or stock
      appreciation right; or

                  (ii)  provide for the exchange of each option, stock
      appreciation right and restricted stock unit (including any related
      dividend equivalent right) outstanding immediately prior to such event
      (whether or not then exercisable) for an option on, stock appreciation
      right, restricted stock unit and dividend equivalent right with respect
      to, as appropriate, some or all of the property which a holder of the
      number of shares of Common Stock subject to such option, stock
      appreciation right or restricted stock unit would have received and,
      incident thereto, make an equitable adjustment as determined by the
      Administrator in its absolute discretion applied in accordance with
      Section 409A of the Code in the exercise price of the option, stock
      appreciation right or restricted stock unit, or the number of shares or
      amount of property subject to the option, stock appreciation right,
      restricted stock unit or dividend equivalent right or, if appropriate,
      provide for a cash payment to the grantee to whom such option, stock
      appreciation right or restricted stock unit was granted in partial
      consideration for the exchange of the option, stock appreciation right or
      restricted stock unit.

      (f)   Outstanding Options, Stock Appreciation Rights, Restricted Stock
Units and Dividend Equivalent Rights--Other Changes. In the event of any change
in the capitalization of the Company or a corporate change other than those
specifically referred to in Sections 3.7(c), (d) or (e) hereof, the
Administrator may, in its absolute discretion exercised in accordance with
Section 409A of the Code, make such adjustments in the number and class of
shares subject to options, stock appreciation rights, restricted stock units and
dividend equivalent rights outstanding on the date on which such change occurs
and in the per-share exercise price of each such option, stock appreciation
right and restricted stock unit as the Administrator may consider appropriate to
prevent dilution or enlargement of rights. In addition, if and to the extent the
Administrator determines it is appropriate, the Administrator may elect to
cancel each option, stock appreciation right and restricted stock unit
(including each dividend equivalent right related thereto) outstanding
immediately prior to such event (whether or not then exercisable), and, in full
consideration of such cancellation, pay to the grantee to whom such option,
stock appreciation right or restricted stock unit was granted an amount in cash,
for each share of Common Stock subject to such option, stock appreciation right
or restricted stock unit, respectively, equal to the excess of (i) the Fair
Market Value of Common Stock on the date of such cancellation over (ii) the
exercise price of such option, stock appreciation right or restricted stock
unit.

      (g)   No Other Rights. Except as expressly provided in the Plan, no
grantee shall have any rights by reason of any subdivision or consolidation of
shares of stock of any class, the payment of any dividend, any increase or
decrease in the number of shares of stock of any class or any dissolution,
liquidation, merger or consolidation of the Company or any other corporation.
Except as expressly provided in the Plan, no issuance by the Company of shares
of stock of any class, or securities convertible into shares of stock of any
class, shall affect, and no adjustment by reason thereof shall be made with
respect to, the number of shares of Common Stock subject to an award or the
exercise price of any option or stock appreciation right.

3.6.  CHANGE IN CONTROL

      (a)   Change in Control Defined. For purposes of this Section 3.6, "Change
in Control" shall mean the occurrence of any of the following:

                  (i)   any person or "group" (within the meaning of Section
      13(d)(3) of the 1934 Act), other than entities which the Chairman of the
      Board directly or indirectly controls (as defined in Rule 12b-2 under the
      1934 Act), acquiring "beneficial ownership" (as defined in Rule 13d-3
      under the 1934 Act), directly or indirectly, of fifty percent (50%) or
      more of the aggregate voting power of the capital stock ordinarily
      entitled to elect directors of the Company;

                  (ii)  the sale of all or substantially all of the Company's
      assets in one or more related transactions to a person other than such a
      sale to a subsidiary of the Company which does not involve a change in the
      equity holdings of the Company or to an entity which the Chairman directly
      or indirectly controls; or

                  (iii) any merger, consolidation, reorganization or similar
      event of the Company or any of its subsidiaries, as a result of which the
      holders of the voting stock of the Company immediately prior to such
      merger, consolidation, reorganization or similar event do not directly or
      indirectly hold at least fifty-one percent (51%) of the aggregate voting
      power of the capital stock of the surviving entity.

      (b)   Effect of a Change in Control. Unless the Administrator provides
otherwise in a Award Agreement, upon the occurrence of a Change in Control:

                  (i)   notwithstanding any other provision of this Plan, any
      award then outstanding shall become fully vested and any award in the form
      of an option, stock appreciation right or restricted stock unit shall be
      immediately exercisable;

                  (ii)  to the extent permitted by law, the Administrator may,
      in its sole discretion, amend any Award Agreement in such manner as it
      deems appropriate;

                  (iii) a grantee who incurs a termination of employment for any
      reason, other than a dismissal for cause, concurrent with or within one
      year following the Change in Control may exercise any outstanding option,
      stock appreciation right or restricted stock unit, but only to the extent
      that the grantee was entitled to exercise the award on his termination of
      employment date, until the earlier of (A) the original expiration date of
      the award and (B) the later of (x) the date provided for under the terms
      of Section 2.5 without reference to this Section 3.6(b)(iii) and (y) the
      first anniversary of the grantee's termination of employment.

      (c)   Miscellaneous. Whenever deemed appropriate by the Administrator, any
action referred to in paragraph (b)(ii) of this Section 3.6 may be made
conditional upon the consummation of the applicable Change in Control
transaction.

3.7.  RIGHT OF DISCHARGE RESERVED

      Nothing in the Plan or in any Award Agreement shall confer upon any
grantee the right to continue his employment with the Company or affect any
right that the Company may have to terminate such employment.

3.8.  NON-UNIFORM DETERMINATIONS

      The Administrator's determinations under the Plan need not be uniform and
may be made by it selectively among persons who receive, or who are eligible to
receive, awards under the Plan (whether or not such persons are similarly
situated). Without limiting the generality of the foregoing, the Administrator
shall be entitled, among other things, to make non-uniform and selective
determinations, and to enter into non-uniform and selective Award Agreements, as
to (a) the persons to receive awards under the Plan, and (b) the terms and
provisions of awards under the Plan.

3.9.  OTHER PAYMENTS OR AWARDS

      Nothing contained in the Plan shall be deemed in any way to limit or
restrict the Company from making any award or payment to any person under any
other plan, arrangement or understanding, whether now existing or hereafter in
effect.

3.10. HEADINGS

      Any section, subsection, paragraph or other subdivision headings contained
herein are for the purpose of convenience only and are not intended to expand,
limit or otherwise define the contents of such subdivisions.

3.11. EFFECTIVE DATE AND TERM OF PLAN

      (a)   Adoption; Stockholder Approval. The Plan was adopted by the Board
which may, but need not, make the granting of any Awards subject to the approval
of the Company's stockholders.

      (b)   Termination of Plan. The Board may terminate the Plan at any time.
All awards made under the Plan prior to its termination shall remain in effect
until such awards have been satisfied or terminated in accordance with the terms
and provisions of the Plan and the applicable Award Agreements.

3.12. RESTRICTION ON ISSUANCE OF STOCK PURSUANT TO AWARDS

      The Company shall not permit any shares of Common Stock to be issued
pursuant to Awards granted under the Plan unless such shares of Common Stock are
fully paid and non-assessable under applicable law.

3.13. GOVERNING LAW

      Except to the extent preempted by any applicable federal law, the Plan
will be construed and administered in accordance with the laws of the State of
New York, without giving effect to principles of conflict of laws.

                                                                       EXHIBIT A

                          ULTRAPETROL (BAHAMAS) LIMITED
                            2006 STOCK INCENTIVE PLAN
                                OPTION AGREEMENT

THIS OPTION AGREEMENT made this [___] day of [___] 200[_], between Ultrapetrol
(Bahamas) Limited (the "Company") and [____________] (the "Optionee").

WHEREAS, the Company desires to carry out the purpose of the Ultrapetrol
(Bahamas) Limited 2006 Stock Incentive Plan (the "Plan"), a copy of which is
attached hereto as Exhibit A, by affording the Optionee an opportunity to
purchase its common stock;

WHEREAS, any terms defined in the Plan shall have the same meaning in this
Agreement;

NOW THEREFORE, under the Plan and in consideration of the mutual covenants
hereinafter set forth, the parties hereto agree as follows:

1.    Grant of Option. The Company hereby grants to the Optionee the right and
      option (the "Option") to purchase [__] shares of common stock of the
      Company, par value $0.01 share (the "Shares") on the terms and conditions
      set forth under the Plan and this Agreement. The Options issued pursuant
      to this Agreement shall constitute nonqualified stock options.

2.    Option Price. Subject to Section 5 below, the purchase price of the Shares
      covered by the Option shall be $[__] per Share which shall be paid in full
      at the time of exercise. The Option Price is the purchase price per Share
      times the number of Options to be exercised. The Option Price may be
      adjusted by the Administrator as provided in Section 3.5 of the Plan.

3.    Method of Exercise. Subject to the terms and conditions of the Plan and
      this Agreement, the vested Options may be exercised upon notice to the
      Company on the form provided by the Administrator and delivery of the
      Option Price attributable to the optioned Shares to be purchased.

4.    Time and Method of Payment. The Option Price for the optioned Shares to be
      purchase shall be paid in full at the time an Option is exercised. The
      Option Price may be paid in a combination of cash and Shares having a
      Market Price equal to the balance of the Option Price. A valid exercise
      requires that the Optionee deliver the form of exercise and full payment
      for the optioned Shares to be purchased to the Company.

5.    Vesting and Term of Option. The Options shall vest with respect to 25% of
      the Options on [__], 200[__] and each of the three anniversaries
      thereafter, conditioned upon the Optionee's continued service as an
      employee of the Company or an affiliate (an "Employee") or as a director
      of the Company from the date of this Agreement until the date such Options
      vest. In the event the Optionee's ceases to be a member of the Board or an
      Employee, as applicable, for any reason, the Optionee shall forfeit all
      rights to the non-

                                        1

      vested Options. Except as otherwise permitted by the Administrator, this
      Option shall not be exercisable to any extent prior to [__], 200___ or
      after [__], 20___.

6.    Exercise. During the term of the Option, a vested Option may be exercised
      in one or more exercises in part or in whole at any time. The
      Administrator, as provided in Section 3.1(c) of the Plan, may accelerate
      the exercisability of the Option at such time and under such circumstances
      as the Administrator, in its sole discretion, deems appropriate.

7.    Termination of Employment, Consultancy or Board Membership. Upon the
      Optionee's termination of service as an Employee, consultant or as a
      member of the Board for any reason, any Options not vested shall be
      forfeited. Except as provided in the case of the Optionee's termination of
      employment by reason of the Optionee's death, Disability or Retirement,
      each Option granted hereunder shall expire, to the extent vested and not
      theretofore exercised, upon the earlier of three months after the date the
      Optionee ceases to be an Employee, consultant or a member of the Board, or
      when the Option would otherwise expire.

8.    Death, Disability or Retirement of Optionee. If an Optionee shall die or
      become Disabled while an Employee or member of the Board, or Retire, all
      vested Options theretofore granted to such Optionee may be exercised
      pursuant to their terms. In the event of death or incapacity an Option
      shall be exercised by a legal representative of an Optionee, written
      notice of such exercise shall be accompanied by a certified copy of
      letters testamentary or equivalent proof of the right of such legal
      representative to exercise such Option.

9.    Taxes. If the Administrator shall so require, as a condition of exercise
      of an Option, the Optionee shall agree that no later than the date of
      exercise, the Optionee will pay to the Company or make arrangements
      satisfactory to the Administrator regarding payment of any federal, state
      or local taxes of any kind required by law to be withheld in connection
      with the exercise of an Option.

10.   Nontransferability. The Option is nontransferable other than by will or by
      the laws of descent and distribution.

11.   Legal Requirements. At the time of the exercise of any Option, the Company
      or the Administrator may postpone the date of exercise until such time as
      the Company has available for delivery to the Optionee a prospectus
      meeting the requirements of all applicable securities laws, and no Shares
      shall be issued or transferred upon the exercise of any Option unless and
      until all legal requirements applicable to the issuance or transfer of
      Shares have been complied with to the satisfaction of the Company.

12.   Representation of Optionee. Prior to the issuance of any Shares pursuant
      to the exercise of Options hereunder, at the request of the Administrator,
      the Optionee shall represent in writing to the Company that it is the
      Optionee's intention to acquire the Shares with respect to which the
      Option is to be exercised for investment and not with a view to the
      distribution thereof.

13.   Changes in Capital Structure. As determined by the Administrator within
      the discretion granted under Section 3.5 of the Plan, if any change
      described in Section 3.5 of the Plan is made to the Shares, an appropriate
      adjustment in the number of Shares for which Options which have been or
      may be granted under the Plan and the Option Price will be made.

14.   Rights as a Shareholder. An Optionee shall have no rights as a shareholder
      with respect to any Shares covered by the Option until the date of the
      issuance of a stock certificate for such Shares. No adjustment shall be
      made for dividends (ordinary or extraordinary, whether in cash, securities
      or other property) or distributions of other rights for which the record
      date is prior to the date such stock certificate is issued, except as
      provided in Section 5 above and Section 7 of the Plan.

15.   Amendment and Termination of the Plan. The Board at any time and from time
      to time may suspend, terminate, modify or amend the Plan; provided,
      however, except as provided in Section 3.5 of the Plan, no suspension,
      termination, modification or amendment of the Plan may, without the
      express written consent of the Optionee involved, adversely affect any
      Option previously granted to the Optionee.

16.   Governing Law. The Plan and this Agreement are governed by the internal
      substantive laws of New York.

IN WITNESS WHEREOF, THE PARTIES HERETO HAVE EXECUTED THIS OPTION AGREEMENT ON
THE DATE FIRST WRITTEN ABOVE.

                          ULTRAPETROL (BAHAMAS) LIMITED

                          By:____________________________
                             Name:
                             Title:

                          OPTIONEE

                          By:____________________________
                             Name:
                             Title:EXHIBIT 10.3

================================================================================

                            STOCK PURCHASE AGREEMENT

                                 BY AND BETWEEN

                         ULTRAPETROL (BAHAMAS) LIMITED,
                                    as Buyer

                                       AND

                                  LAIF XI LTD.
                                    as Seller

                           Dated as of March 21, 2006

================================================================================

                                TABLE OF CONTENTS

                                                                            PAGE

ARTICLE I             PURCHASE OF OWNERSHIP INTEREST...........................1

   1.1        Purchase of LAIF UP Offshore Shares by Buyer.....................1
   1.2        Purchase Price...................................................2
   1.3        Closing..........................................................2

ARTICLE II            REPRESENTATIONS AND WARRANTIES OF SELLER.................2
   2.1        Power and Authority..............................................2
   2.2        Authorization and Enforceability.................................2
   2.3        No Conflicts.....................................................3
   2.4        No Consents......................................................3
   2.5        Company Organization and Capitalization..........................3
   2.6        Subsidiaries.....................................................4
   2.7        Litigation; Observance of Agreements, Statutes and Orders........4
   2.8        Title to Property; Leases........................................5
ARTICLE III           REPRESENTATIONS AND WARRANTIES OF BUYER..................8

   3.1        Representations and Warranties of Buyer..........................8
   3.2        Organization, Power and Authority................................8
   3.3        Authorization and Enforceability.................................8
   3.4        No Conflicts.....................................................8
   3.5        Consents.........................................................9
   3.6        Litigation; Observance of Agreements, Statutes and Orders........9
   3.7        Investment Intent................................................9
   3.8        Accredited Investor.............................................10
   3.9        Brokers' or Finders' Fees.......................................10
   3.10       Seller's Representation.........................................10

ARTICLE IV            CERTAIN COVENANTS.......................................10

   4.1        Cooperation.....................................................10
   4.2        Conduct of Company Business.....................................10
   4.3        Buyer's Access and Inspection...................................12

ARTICLE V             PUT OPTION..............................................12

   5.1        Buyer's Put Option..............................................12
   5.2        Notification....................................................12
   5.3        Exercise of Put Option..........................................12
   5.4        Conditions Precedent to Exercise of Put Option..................13

ARTICLE VI            CONDITIONS TO CLOSING...................................13

   6.1        Conditions Precedent to Obligations of Buyer....................13
   6.2        Conditions Precedent to Obligations of Seller...................14

ARTICLE VII           INDEMNIFICATION.........................................14

   7.1        Survival of Representations, Warranties and Indemnities.........14

                                       -i-

                                TABLE OF CONTENTS
                                   (continued)
                                                                            PAGE

   7.2        Indemnification.................................................14

ARTICLE VIII          MISCELLANEOUS...........................................15

   8.1        Notices.........................................................15
   8.2        Entire Agreement................................................16
   8.3        Waivers and Amendments; Non-Contractual Remedies;
                 Preservation of Remedies.....................................16
   8.4        Assignability; Binding Effect...................................16
   8.5        Governing Law; Submission to Jurisdiction Waiver of
                 Jury Trial...................................................16
   8.6        Counterparts....................................................17
   8.7        Further Assurances..............................................17
   8.8        Severability....................................................17
   8.9        Exhibit and Schedules...........................................17
   8.10       Captions........................................................18
   8.11       Interpretation..................................................18
   8.12       Third Parties...................................................18
   8.13       Expenses........................................................18
   8.14       Knowledge.......................................................18
   8.15       Specific Performance............................................18

                                      -ii-

Schedules
---------

Schedule I                 Defined Terms
Schedule 2.5               Shareholders Contracts
Schedule 2.6               Subsidiaries
Schedule 2.8(a)            Assets
Schedule 2.8(b)            Real Property/Leaseholds
Schedule 2.10              Indebtedness; Other Liabilities
Schedule 2.11              Material Contracts
Schedule 2.14              Employees
Schedule 2.15              Transactions with Affiliates

Exhibits
--------

Exhibit A                  Form of Note

Exhibit B                  Form of Pledge

                                      -iii-

                            STOCK PURCHASE AGREEMENT

         STOCK PURCHASE AGREEMENT, dated as of March 21, 2006 (this
"Agreement"), by and between (i) ULTRAPETROL (BAHAMAS) LIMITED ("Ultrapetrol"),
a Bahamas corporation ("Buyer"), as buyer and (ii) LAIF XI LTD., a Bermudan
company ("Seller"), as seller.

                               W I T N E S S E T H

         WHEREAS, Ultrapetrol is the record and beneficial owner of 12,499,881
shares of common stock, par value 0.01 per share, of UP Offshore (Bahamas)
Limited, a Bahamas corporation ("UP Offshore"), which represents, in the
aggregate, twenty-seven and seventy-eight on-hundredths of one percent (27.78%)
of the issued and outstanding capital stock in UP Offshore; and

         WHEREAS, LAIF is the record and beneficial owner of 30,000,000 shares
of common stock, par value 0.01 per share, of UP Offshore, which represents, in
the aggregate, sixty-six and sixty-seven one-hundredths of one percent (66.67%)
of the issued and outstanding common stock in UP Offshore (the "LAIF UP Offshore
Shares");

         WHEREAS, Seller desires to sell and transfer to Buyer the LAIF UP
Offshore Shares, and Buyer wishes to purchase the LAIF UP Offshore Shares, upon
the terms and subject to the conditions herein contained; and

         WHEREAS, capitalized terms used but not defined herein shall have the
respective meanings ascribed to such terms in Schedule I hereto.

         NOW, THEREFORE, in consideration of the mutual covenants described
below and for other good and valuable consideration, the receipt of which is
hereby acknowledged, the parties hereto hereby covenant and agree as follows:

                                   ARTICLE I

                         PURCHASE OF OWNERSHIP INTEREST

1.1 Purchase of LAIF UP Offshore Shares by Buyer.
    ---------------------------------------------

         Upon the terms and subject to the conditions of this Agreement Seller
shall, at the Closing, sell and transfer the LAIF UP Offshore Shares to Buyer,
free and clear of any and all Liens, and Buyer shall purchase, the LAIF UP
Offshore Shares for the consideration provided for in Section 1.2, which shall
represent, immediately after Closing and the consummation of all of the other
transactions contemplated hereunder, sixty-six and sixty-seven one hundredths of
one percent (66.67%) of the issued and outstanding common stock of UP Offshore.
Seller and Buyer shall execute and deliver at the Closing all documentation
reasonably necessary to effect the sale and transfer of the LAIF UP Offshore
Shares as provided for in this Agreement.

1.2 Purchase Price.
    ---------------

         In consideration of the sale and transfer of the UP Offshore Shares as
set forth in Section 1.1, Buyer shall pay to Seller the sum of Forty-Eight
Million United States Dollars (US$48,000,000.00) (the "Purchase Price"), which
amount shall be payable as follows: At the Closing, Buyer shall issue to Seller
a promissory note (the "Note") in the form attached hereto as Exhibit A, in an
amount equal to the Purchase Price. The Note shall be due and payable upon the
earlier of (i) the initial public offering of the common stock of the Buyer on a
recognized stock exchange (the "IPO") and (ii) September 30, 2006. The Note
shall be non-interest-bearing and shall be secured by a first-ranking pledge
over the LAIF UP Offshore Shares, such pledge to be substantially in the form of
Exhibit B hereto.

1.3 Closing.
    --------

         Subject to satisfaction or waiver of the conditions set forth in
Article V, the sale and transfer of the LAIF UP Offshore Shares shall take place
on such date on or prior to March 24, 2006, as may be designated in writing on
not less five (5) days' prior notice from Buyer to Seller, at the offices of
Seward & Kissel LLP, One Battery Park Plaza, New York, New York 10004, at a
closing (the "Closing") at 10:00 a.m., local time, or, or such other place, time
or date as the parties may mutually agree in writing (such time and date being
referred to herein as the "Closing Date").

                                   ARTICLE II

                    REPRESENTATIONS AND WARRANTIES OF SELLER

         Representations and Warranties of Seller. Seller hereby represents and
warrants as to the matters pertaining solely to itself and, to the best of its
Knowledge, as to UP Offshore, its Subsidiaries and to any other matter below, to
the Buyer that:

2.1 Power and Authority.
    --------------------

         Seller has the full right, power and authority to enter into this
Agreement and to transfer, convey and sell to Buyer at the Closing the LAIF UP
Offshore Shares. Seller is the sole owner of, and has good, valid, and
marketable title to the LAIF UP Offshore Shares, free and clear of any and all
Liens and, upon consummation of the purchase contemplated hereby, Buyer will
acquire from Seller good, valid and marketable title to the LAIF UP Offshore
Shares, free and clear of all Liens.

2.2 Authorization and Enforceability.
    ---------------------------------

         The execution, delivery and performance of this Agreement has been duly
authorized by all necessary action on the part of Seller, and constitutes a
legal, valid and binding obligation of Seller, enforceable against Seller in
accordance with its terms, except as such enforceability may be limited by: (i)
applicable bankruptcy, insolvency, reorganization, moratorium or other similar
laws affecting the enforcement of creditors' rights generally; and (ii) general
principles of equity (regardless of whether such enforceability is considered in
a proceeding in equity or at law).

                                       2

2.3 No Conflicts.
    -------------

         Neither the execution, delivery and performance of this Agreement nor
the consummation of any of the transactions contemplated hereunder will:

         (a) conflict with or result in any violation of or constitute a breach
of any of the terms or provisions of, or result in the acceleration of any
obligation under, or constitute a default under any provision of, the articles
of incorporation or bylaws or other organizational documents of either Seller or
UP Offshore, or any mortgage, bond, indenture, agreement, franchise, license,
permit or other instrument or obligation to which either Seller or UP Offshore
is a party or subject or by which any of their respective assets or properties
may be bound except as contained in the agreements listed in Schedule 2.5;

         (b) result in the creation of any Lien upon any of the assets or
properties of either Seller or UP Offshore; or

         (c) violate any Legal Requirement against, affecting or binding upon,
The Seller or UP Offshore or upon any of their respective assets or properties.

2.4 No Consents.
    ------------

         All consents, approvals or authorizations of, or registrations, filings
or declarations with, any Governmental Authority or any other Person, if any,
required in connection with the execution, delivery or performance by either
Seller of this Agreement or the transactions provided for herein have been or at
the Closing will have been obtained by such Seller and will be in full force and
effect.

2.5 Company Organization and Capitalization.
    ----------------------------------------

         (a) UP Offshore is a corporation, duly organized, validly existing and
in good standing under the laws of the Commonwealth of the Bahamas and is duly
qualified to do business and is in good standing in each jurisdiction in which
such qualification is required by law, other than those jurisdictions as to
which the failure to be so qualified or in good standing could not, individually
or in the aggregate, reasonably be expected to have a Material Adverse Effect.
UP Offshore has the power and authority to own or hold under lease the
properties it purports to own or hold under lease, to transact the business it
transacts and proposes to transact. Other than the articles of incorporation and
the by-laws of UP Offshore and the Shareholders Agreement (the "Shareholders
Agreement") among the Buyer, the Seller and Comintra Enterprises Ltd. (which
shareholders agreement is being restated contemporaneously herewith to remove
the Seller as a party thereto) and agreements listed on Schedule 2.5, there are
no other agreements or documents to which UP Offshore or either Seller is a
party with respect to the governance or capitalization of UP Offshore,

         (b) The authorized capital stock of UP Offshore consists solely of
60,000,000 shares of common stock, par value $0.01 and 20,000,000 shares of
preferred stock. As of the date hereof and as of the Closing Date, there are and
shall be 45,000,000 shares of common stock issued and outstanding as well as
3,000,000 shares of Series A preferred stock with a par value of $0.01 per share
issued and outstanding in favor of International Finance Corporation and such

                                       3

shares constitute all of the issued and outstanding shares of the capital stock
of UP Offshore. All such shares have been duly authorized, validly issued and
are fully paid and non-assessable. Upon consummation of the Closing, Seller will
sell to the Buyer sixty-six and sixty-seven one hundredths of one percent
(66.67%) of the issued and outstanding common stock of UP Offshore owned by the
Seller.

         (c) Other than the Warrant Agreement, dated June 4, 2003 (scheduled
under Schedule 2.15), to the Seller's Knowledge, there are no outstanding
obligations, warrants, options or other rights to subscribe for or purchase from
UP Offshore, or other contracts or commitments providing for the issuance of or
the granting of rights to acquire, any equity interest in UP Offshore, or any
securities or other instruments convertible into or exchangeable for the
foregoing.

         (d) Except as listed in Schedule 2.5 and except for the rights of Buyer
hereunder, no Person has any right of first refusal, preemptive right,
subscription right or similar right with respect to any stock, securities or
equity interest in UP Offshore.

2.6 Subsidiaries.
    -------------

         (a) Exhibit 2.6 sets forth a complete and accurate organizational chart
of UP Offshore and all of its Subsidiaries, listing for each Subsidiary its
name, indicating its type of entity, the jurisdiction of its incorporation or
organization, and its ownership structure.

         (b) Other than the Subsidiaries, there are no other corporations,
partnerships, joint ventures, associations or other entities in which UP
Offshore or any Subsidiary owns, of record or beneficially, any direct or
indirect equity or other interest or any right (contingent or otherwise) to
acquire the same. Neither UP Offshore nor any Subsidiary is a member of any
partnership nor is UP Offshore or any Subsidiary a participant in any joint
venture or similar arrangement.

         (c) Each Subsidiary: (i) is duly organized, validly existing and in
good standing under the Laws of its jurisdiction of organization, (ii) has all
necessary power and authority to own, operate or lease the properties and assets
owned, operated or leased by such Subsidiary and to carry on its business as it
has been and is currently conducted by such Subsidiary, and (iii) is duly
licensed or qualified to do business and is in good standing in each
jurisdiction in which the properties owned or leased by it or the operation of
its business makes such licensing or qualification necessary or desirable, other
than those jurisdictions as to which the failure to be so licensed, qualified or
in good standing would not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect.

         (d) All corporate actions taken by each Subsidiary have been duly
authorized and no Subsidiary has taken any action that in any respect conflicts
with, constitutes a default under or results in a violation of any provision of
its Certificate of Incorporation or By-laws (or similar organizational
documents).

                                       4

2.7 Litigation; Observance of Agreements, Statutes and Orders.
    ----------------------------------------------------------

         (a) There are no actions, investigations, demands, suits or proceedings
pending or threatened against or affecting UP Offshore, any officer, director or
employee of UP Offshore or any property or business of UP Offshore, the validity
of this Agreement or the rights of Sellers to enter into this Agreement or
consummate the transactions contemplated hereby in any court or agency or before
any arbitrator of any kind or before or by any Governmental Authority, that,
individually or in the aggregate, could reasonably be expected to have a
Material Adverse Effect.

         (b) UP Offshore is not in default under or in violation of any term of
any agreement or instrument to which it is a party or by which it is bound, or
any Legal Requirement, which default or violation, individually or in the
aggregate, could reasonably be expected to have a Material Adverse Effect.

         (c) As of the date hereof and as of the Closing Date, no officer,
director or employee of UP Offshore is or will be subject to any non-competition
agreement, restrictive covenant or any other agreement restricting such person's
ability to work for, provide services to, or otherwise participate in UP
Offshore's business as currently contemplated.

2.8 Title to Property; Leases.
    --------------------------

         (a) UP Offshore has good and sufficient title to its owned personal
properties, tangible and intangible, and valid, binding and enforceable
leasehold interests in its leased personal properties that individually or in
the aggregate are Material, in each case free and clear of Liens other than in
respect of the mortgages on the vessels securing the indebtedness identified on
Schedule 2.10. All such personal property, other than vessels currently under
construction, is in working condition, ordinary wear and tear excepted. Such
properties constitute all of the personal properties necessary to operate UP
Offshore's business as currently conducted. All leasehold interests and
agreements of UP Offshore to such personal property are subsisting and
enforceable in accordance with their terms and, there does not exist thereunder
any default or event or condition which, after notice or lapse of time or both,
would constitute a default thereunder or which would have a Material Adverse
Effect on UP Offshore. Schedule 2.8(a) sets forth a brief description of all of
the assets of UP Offshore having a value in excess of Ten Thousand Dollars
($10,000).

         (b) UP Offshore has good and marketable title to all of its owned real
property, if any, and valid, binding and enforceable leasehold interests in its
leased real property, if any, that individually or in the aggregate are
Material, in each case free and clear of all Liens. Schedule 2.8(b) sets forth a
description of all real property owned by UP Offshore. All leasehold interests
and agreements of UP Offshore to its real property are subsisting and, there
does not exist thereunder any default or event or condition which, after notice
or lapse of time or both, would constitute a default thereunder or which would
have a Material Adverse Effect on UP Offshore. UP Offshore enjoys peaceful and
undisturbed possession under its leases of real property. Schedule 2.8(b) sets
forth a description of all leasehold interests in real property held by UP
Offshore.

                                       5

2.9 Intellectual Property.
    ----------------------

         The only Intellectual Property owned by UP Offshore is the common law
trademark of its name and the registered domain name for its internet website.
UP Offshore is the exclusive owner of its Intellectual Property free and clear
of any Liens. To the Knowledge of the Sellers, the rights of UP Offshore in the
Intellectual Property it owns do not conflict with or infringe on the rights of
any other Person, and the Sellers have not received any claim or written notice
from any Person to such effect.

2.10 Indebtedness; Other Liabilities.
     --------------------------------

         Schedule 2.10 sets forth a complete and correct statement of the
Indebtedness of UP Offshore as of the date hereof. UP Offshore is not in default
with respect to any such Indebtedness, or any instrument or agreement relating
thereto. UP Offshore does not have any Indebtedness or liability, absolute or
contingent, liquidated or unliquidated, whether due or to become due, which is
not reflected on Schedule 2.10.

2.11 Material Contracts.
     -------------------

         Schedule 2.11 sets forth a list of Material Contracts of UP Offshore as
of the date hereof. The Seller has made available to Buyer for its review a
correct and complete copy of each such Material Contract. With respect to each
such Material Contract: (i) such contract is legal, valid, binding, enforceable,
and in full force and effect, (ii) such contract will continue to be legal,
valid, binding, enforceable, and in full force and effect on identical terms
following the consummation of the transactions contemplated hereby, and (iii) to
the Knowledge of Sellers, no party is in breach or default, and no event has
occurred which with notice or lapse of time or both would constitute a breach or
default, or permit termination, modification, or acceleration, under such
contract.

2.12 No Material Misstatements or Omissions; Disclosure.
     ---------------------------------------------------

         No representation or warranty of the Seller in this Agreement contains
or will contain any untrue statement of a material fact nor shall such
representations and warranties taken as a whole omit any statement necessary in
order to make any material statement contained herein not misleading. There is
no fact that has not been disclosed hereunder to Buyer that might reasonably be
expected to have or result in a Material Adverse Effect on or with respect to UP
Offshore.

2.13 Broker's or Finder's Fees.
     --------------------------

         No broker, finder or similar agent has been employed by or on behalf of
the Seller, and no person or entity with which the Seller has had any dealings
or communications of any kind is entitled to any brokerage commission, finder's
fee or any similar compensation, in connection with this Agreement or the
transactions contemplated hereby.

                                       6

2.14 Employees and Labor Relations.
     ------------------------------

         There is no labor strike, work stoppage or slowdown, picketing,
boycott, lockout or other labor dispute either pending or threatened, against UP
Offshore or affecting its business or which would in any way interfere with or
impair in any Material respect the operation or the conduct of UP Offshore's
business. UP Offshore is in compliance in all Material respects with all
applicable federal, state, and local laws respecting employment, fair employment
practices and fair labor standards, including, without limitation, race, age,
sex, religion, color, national origin, disability and sexual orientation.
Schedule 2.14 sets forth a list of all employees of UP Offshore.

2.15 Affiliate Transactions.
     -----------------------

         Schedule 2.15 contains an accurate and complete listing of all
contracts, leases, agreements or understandings, whether written or oral, with
or on behalf of any Affiliate of UP Offshore to which UP Offshore is a party or
is otherwise bound. None of such contracts, leases, agreements or understandings
contain terms that are more favorable than terms that would be obtainable from a
Person other than an Affiliate or that have been entered into by UP Offshore
other than in the ordinary course of business. Except as disclosed on Schedule
2.15, UP Offshore does not have any agreement, arrangement or understanding with
any of its Affiliates, the cancellation or termination of which would have a
Material Adverse Effect on UP Offshore.

2.16 Compliance with Laws.
     ---------------------

         UP Offshore is in Material compliance with all Legal Requirements and
UP Offshore has not received notice of any complaint or order alleging any
Material non-compliance by UP Offshore with respect to any such Legal
Requirements.

2.17 Environmental Matters.
     ----------------------

         Seller has no Knowledge of any claim and has not received any notice of
any claim, and no proceeding has been instituted raising any claim against UP
Offshore or any of its properties now or formerly owned, leased or operated by
it or other assets, alleging any damage to the environment or violation of any
Environmental Laws, except, in each case, such as could not reasonably be
expected to result in a Material Adverse Effect. Seller has no Knowledge of any
facts which would give rise to any claim, public or private, of violation of
Environmental Laws or damage to the environment emanating from, occurring on or
in any way related to properties now or formerly owned, leased or operated by UP
Offshore or to other assets or their use, except, in each case, such as could
not reasonably be expected to result in a Material Adverse Effect. UP Offshore
has not stored any Hazardous Materials on properties now or formerly owned,
leased or operated by it other than in the ordinary course of business nor has
it disposed of any Hazardous Materials in a manner contrary to any Environmental
Laws in each case in any manner that could reasonably be expected to result in a
Material Adverse Effect. All buildings on all real properties now owned, leased
or operated by UP Offshore are in compliance with applicable Environmental Laws,
except where failure to comply could not reasonably be expected to result in a
Material Adverse Effect.

                                       7

2.18 Securities Law.
     ---------------

         In reliance on the investment representations contained in Sections 3.7
and 3.8, the offer, issuance, sale and delivery of the UP Offshore Shares, as
provided in this Agreement, are exempt from the registration requirements of the
Securities Act and all applicable state securities laws, and are otherwise in
compliance with such laws. Neither UP Offshore nor any Person acting on its
behalf has taken or will take any action which might subject the sale or
transfer of the UP Offshore Shares to the registration requirements of Section 5
of the Securities Act.

2.19 Registration Under Exchange Act.
     --------------------------------

         UP Offshore has not registered any class of its securities pursuant to
Section 12 of the Exchange Act and no such registration is required by the
Exchange Act. UP Offshore is not under any obligation to register, under the
Securities Act, any of its presently outstanding securities or any securities
which may hereafter be issued.

                                  ARTICLE III

                     REPRESENTATIONS AND WARRANTIES OF BUYER

3.1 Representations and Warranties of Buyer.
    ----------------------------------------

         Buyer hereby represents and warrants to The Seller that:

3.2 Organization, Power and Authority.
    ----------------------------------

         Buyer is a corporation duly organized, validly existing and in good
standing under the laws of the Bahamas, and is duly qualified to do business and
is in good standing in each jurisdiction in which such qualification is required
by law, other than those jurisdictions as to which the failure to be so
qualified or in good standing could not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect. Buyer has the power
and authority to transact the business it transacts and Buyer has the power and
authority to execute and deliver this Agreement and to perform the provisions
hereof.

3.3 Authorization and Enforceability.
    ---------------------------------

         The execution, delivery and performance of this Agreement has been duly
authorized by all necessary corporate action on the part of Buyer, and
constitutes the legal, valid and binding obligation of Buyer enforceable against
Buyer in accordance with its terms, except as such enforceability may be limited
by: (i) applicable bankruptcy, insolvency, reorganization, moratorium or other
similar laws affecting the enforcement of creditors' rights generally; and (ii)
general principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law).

                                       8

3.4 No Conflicts.
    -------------

         Neither the execution, delivery and performance of this Agreement nor
the consummation of any of the transactions contemplated hereunder will:

         (a) conflict with or result in any violation of or constitute a breach
of any of the terms or provisions of, or result in the acceleration of any
obligation under, or constitute a default under any provision of, the
certificate of incorporation, the by-laws or other organizational document of
Buyer, or any mortgage, bond, indenture, agreement, franchise, license, permit
or other instrument or obligation to which Buyer is a party or subject or by
which any of its assets or properties may be bound; or

         (b) violate any Legal Requirement against, affecting or binding upon,
Buyer or upon any of its assets or properties.

         In addition to the Articles of Incorporation and By-Laws of UP
Offshore, regarding any document or matter listed in any Schedule under Article
2 hereof, Buyer (i) acknowledges having received and reviewed such document or
matter, (ii) has taken such document or matter into consideration in entering
into this Agreement and (iii) Seller has no further obligation under any such
document or matter.

3.5 Consents.
    ---------

         All consents, approvals or authorizations of, or registrations, filings
or declarations with, any Governmental Authority or any other Person, if any,
required in connection with the execution, delivery or performance by Buyer of
this Agreement or the transactions provided for herein have been or at the
Closing will have been obtained by Buyer and will be in full force and effect.

3.6 Litigation; Observance of Agreements, Statutes and Orders.
    ----------------------------------------------------------

         (a) There are no actions, investigations, demands, suits or proceedings
pending or, to the Knowledge of Buyer, threatened against or affecting Buyer
that, individually or in the aggregate, could reasonably be expected materially
to impair the ability of Buyer to perform its obligations under this Agreement
or affect the validity or enforceability of this Agreement.

         (b) Buyer is not in default under any term of any agreement or
instrument to which it is a party or by which it is bound, or any order,
judgment, decree or ruling of any court, arbitrator or Governmental Authority or
is in violation of any applicable law, ordinance, rule or regulation of any
Governmental Authority, which default or violation, individually or in the
aggregate, could reasonably be expected materially to impair the ability of
Buyer to perform its obligations under this Agreement or affect the validity or
enforceability of any of this Agreement.

                                       9

3.7 Investment Intent.
    ------------------

         Buyer is acquiring the LAIF UP Offshore Shares for its own account, for
investment purposes and not with a view to its distribution within the meaning
of the Securities Act and the rules and regulations promulgated thereunder.
Buyer will not, directly or indirectly, offer, transfer, sell, assign, pledge,
hypothecate or otherwise dispose of any of the LAIF UP Offshore Shares (or
solicit any offers to buy, purchase, or otherwise acquire any of the LAIF UP
Offshore Shares), except in compliance with the Securities Act.

3.8 Accredited Investor.
    --------------------

         Buyer is an "accredited investor" (as that term is defined in Rule 501
of Regulation D under the Securities Act) and by reason of its business and
financial experience, it has such Knowledge, sophistication and experience in
business and financial matters as to be capable of evaluating the merits and
risks of the prospective investment, is able to bear the economic risk of such
investment and is able to afford a complete loss of such investment. Buyer has
had an opportunity to investigate the business and financial condition of Seller
and UP Offshore, to ask questions of Seller and UP Offshore and to obtain such
information as Buyer requires from Seller and UP Offshore.

3.9 Brokers' or Finders' Fees.
    --------------------------

         No broker, finder or similar agent has been employed by or on behalf of
Buyer, and no person or entity with which Buyer has had any dealings or
communications of any kind is entitled to any brokerage commission, finder's fee
or any similar compensation, in connection with this Agreement or the
transactions contemplated hereby.

3.10 Seller's Representations.
     -------------------------

         Buyer has no knowledge of any representation or warranty of Seller set
forth in Article II that is not true and correct in all material respects.

3.11 Warrant Agreement.
     ------------------

         Buyer acknowledges that the Purchase Price has been agreed between
Buyer and Seller taking into consideration the full effect, if any, that the
Warrant Agreement dated June 4, 2003 may have, now or in the future, on the
number of issued and outstanding common stock of UP Offshore, and that the Buyer
has no claim against the Seller in connection with the Warrant Agreement, now or
in the future.

                                   ARTICLE IV

                                CERTAIN COVENANTS

4.1 Cooperation.
    ------------

         Each of the parties shall use its respective reasonable best efforts
and will cooperate with each other to secure all necessary consents, approvals,
authorizations,

                                       10

assumptions and waivers from third parties as shall be required in order to
enable the transactions contemplated hereby to be effected, and each of the
parties shall otherwise use its respective reasonable best efforts to cause the
consummation of such transactions in accordance with the terms and conditions
hereof and to cause all conditions contained in this Agreement over which it has
control to be satisfied.

4.2 Conduct of Company Business.
    ----------------------------

         After the date of this Agreement and through the Closing Date, except
with the consent of Buyer, Seller agrees to, and after the Closing Date through
the date that is the earlier of (i) the exercise of Buyer's Put Option, and (ii)
satisfaction of all obligations under the Note, except with the written consent
of the Seller, Buyer agrees to, and shall cause UP Offshore, to:

         (a) operate in the ordinary course of business;

         (b) refrain from making or causing to be made any change in the
certificate of incorporation, bylaws and any other organizational documents of
UP Offshore;

         (c) not acquire by merging or consolidating with, or agreeing to merge
or consolidate with, or purchase substantially all of the stock or assets of, or
otherwise acquire, any business or any corporation, partnership, association or
other business organization or division thereof;

         (d) not enter into any partnership, joint venture or similar type of
arrangement;

         (e) not issue or agree to issue any additional shares of the capital
stock of UP Offshore or ownership interests or other equity interests or
securities convertible into or exchangeable for or other rights with respect to
ownership interests or other equity interests of UP Offshore;

         (f) not declare or pay any dividends or make any other distribution in
cash or property on its capital stock or purchase or redeem, directly or
indirectly, any shares of its capital stock;

         (g) except as otherwise provided by law or GAAP, refrain from making or
causing to be made any change in the accounting methods, principles or practices
of UP Offshore;

         (h) not enter into, terminate or modify any contract, transaction, or
commitment, other than in the ordinary course of business or pursuant to
presently existing plans, arrangements or agreements other than charters in
respect of any vessel owned, directly or indirectly, by UP Offshore or advances
to or settlements with shipyards for vessels currently under construction;

         (i) not: (a) sell, transfer, license, lease or otherwise dispose of or
encumber any of its properties or assets, other than in the ordinary course of
business or pursuant to presently existing plans, arrangements or agreements
disclosed herein or in a schedule hereto; (b) cancel

                                       11

any debt or waive or compromise any claim or right, except in the ordinary
course of business or pursuant to presently existing plans, arrangements or
agreements disclosed herein or in a schedule hereto; (c) enter into any
employment agreement or grant any increase in the compensation of officers or
employees, (d) make any capital expenditure or commitment, other than pursuant
to presently existing plans, arrangements or agreements disclosed herein or in a
schedule hereto; (e) establish any new Plan; or (f) incur, assume or guarantee
any Indebtedness which will constitute a liability of UP Offshore as of the
Closing Date other than such Indebtedness incurred in the ordinary course of
business and not to exceed at any one time U.S.$2,000,000

         (j) Buyer will not modify the UP Offshore Amended and Restated Common
Shareholders Agreement dated as of December 5, 2003 by and among Seller, Buyer,
Comintra and UP Offshore (the "Common Shareholders Agreement") without Seller's
consent until all obligations under the Note have been satisfied. Buyer and
Seller agree to undertake all actions required by Seller to accede to such
Common Shareholders Agreement in the event the Pledge is exercised.

4.3 Buyer's Access and Inspection.
    ------------------------------

         The Seller shall cause UP Offshore to allow Buyer and its authorized
representatives reasonable access from and after the date hereof and prior to
the Closing Date to the properties, books, Material Contracts, and records of UP
Offshore for the purpose of making such investigation as Buyer may reasonably
desire, and The Seller shall cause UP Offshore to furnish Buyer such information
concerning UP Offshore and its affairs as Buyer may reasonably require.

                                   ARTICLE V

                                   PUT OPTION

5.1 Buyer's Put Option.
    -------------------

         Seller hereby grants to Buyer an irrevocable option (the "Put Option")
to cause Seller (or a wholly owned subsidiary of Seller to be designated by
Seller) to purchase from Buyer all, but not less than all, of the LAIF UP
Offshore Shares for the Purchase Price. The Purchase Price may be paid in full
by Seller surrendering the Note to Buyer. The Put Option shall commence on the
first Business Day following the Closing and shall terminate upon the earlier of
(i) the IPO, (ii) September 30, 2006, and (iii) satisfaction of all obligations
under the Note.

5.2 Notification.
    -------------

         From and after the date hereof and prior to the Closing Date, Seller
shall promptly notify Buyer at any time that Seller becomes aware that any
representation or warranty made by Seller in or pursuant to this Agreement is
untrue or inaccurate in any Material respect and shall promptly notify Buyer of
any Material Adverse Effect on UP Offshore and of any governmental complaints,
investigations, hearings or proceedings which would have a Material Adverse
Effect on UP Offshore. Without limiting the generality of the foregoing, Seller
shall promptly notify

                                       12

Buyer of any of the events, conditions or circumstances described in Sections
2.7(a), (b) and (c), in each case without regard to any qualification as to
Material Adverse Effect.

5.3 Exercise of Put Option.
    -----------------------

         The Put Option shall be exercised by the Buyer's delivery to Seller of
a written notice no later September 23, 2006 of the Buyer's intent to cause
Seller (or its designee) to purchase all, but not less than all, of the LAIF UP
Offshore Shares (the "Put Option Notice"). Upon the exercise of the Put Option,
Seller (or its designee) shall purchase, and the Buyer shall sell no earlier
than seven days after the date of the Put Option Notice and no later than
September 30, 2006 (the "Put Option Closing Date"), the LAIF UP Offshore Shares,
free and clear of any Liens, at which time the Note shall be cancelled and the
certificates for the LAIF UP Offshore Shares shall be delivered to Seller,
together with such instruments of transfer as are necessary to vest title to the
LAIF UP Offshore Shares in Seller. The Seller and Buyer each hereby agree that
in the event the Buyer exercises the Put Option, the Buyer and Seller shall
undertake all actions required by Seller to accede to the Common Shareholders
Agreement.

5.4 Conditions Precedent to Exercise of Put Option.
    -----------------------------------------------

         Buyer and Seller hereby agree that it shall be a condition precedent to
the exercise of the Put Option that (i) the IPO process shall have been
terminated by mutual agreement of Buyer's shareholders or, in any event, the IPO
shall not have occurred by September 15, 2006, (ii) no breach of the
representations made by the Buyer hereunder shall have occurred.

                                   ARTICLE VI

                              CONDITIONS TO CLOSING

6.1 Conditions Precedent to Obligations of Buyer.
    ---------------------------------------------

         The obligation of Buyer to purchase the LAIF UP Offshore Shares
pursuant to this Agreement is subject to the fulfillment, prior to or at the
Closing, of each of the following conditions (any or all of which may be waived
in whole or in part by Buyer):

         (a) all representations and warranties made by Seller to Buyer shall be
true and correct in all material respects as of the date hereof and as of the
time of the Closing with the same effect as though made again at and as of that
time;

         (b) Seller shall have performed and complied in all material respects
with all obligations and covenants required by this Agreement to be performed or
complied with by Seller prior to or at the Closing;

         (c) there shall be no actions, suits or proceedings pending or, to
Seller's Knowledge, threatened against or affecting Seller or UP Offshore or any
property of UP Offshore in any court or before any arbitrator of any kind or
before or by any Governmental Authority that, individually or in the aggregate,
could reasonably be expected to have a Material Adverse Effect;

                                       13

         (d) all notifications, consents, authorizations, approvals and
clearances from the Board of Directors of Buyer and each Governmental Authority
and any other Person required to be made or obtained, in connection with the
transactions provided for in this Agreement shall have been made or obtained on
terms satisfactory to Buyer;

         (e) all proceedings to be taken in connection with the transactions
contemplated by this Agreement and all documents incident thereto shall be
reasonably satisfactory in form and substance to Buyer and its counsel, and
Buyer shall have received copies of all such documents and other evidence as it
or its counsel may reasonably request in order to establish the consummation of
such transactions and the taking of all proceedings in connection therewith;

         (f) since the date of this Agreement there shall have been no Material
Adverse Effect to UP Offshore; and

         (g) Seller shall have delivered, to Buyer, stock certificates
representing the LAIF UP Offshore Shares, accompanied by powers duly endorsed or
executed in blank, and all other documents necessary to transfer to Buyer the
LAIF UP Offshore Shares free and clear of any Lien.

6.2 Conditions Precedent to Obligations of Seller.
    ----------------------------------------------

         The obligation of Seller to sell and transfer the LAIF UP Offshore
Shares pursuant to this Agreement is subject to the fulfillment, prior to or at
the Closing, of each of the following conditions (any or all of which may be
waived in whole or in part by Seller):

         (a) all representations and warranties of Buyer to Seller shall be true
and correct in all material respects as of the date hereof and at and as of the
time of the Closing with the same effect as though those representations and
warranties had been made at and as of that time;

         (b) Buyer shall have performed and complied in all material respects
with all obligations and covenants required by this Agreement to be performed or
complied with by Buyer prior to or at the Closing;

         (c) Buyer shall have duly executed and delivered the Note to Seller as
set forth in Section 1.2 hereof; and

                                       14

                                  ARTICLE VII

                                 INDEMNIFICATION

7.1 Survival of Representations, Warranties and Indemnities.
    --------------------------------------------------------

         The representations and warranties of Seller and Buyer contained in
Articles II and III, respectively, shall survive the Closing for a period of
three (3) years.

7.2 Indemnification.
    ----------------

         (a) Seller agrees to indemnify, defend and hold harmless Buyer, its
Affiliates and, if applicable, their respective directors, officers,
shareholders, employees, attorneys, accountants, agents and representatives and
their heirs, successors and assigns from and against any and all Damages based
upon, arising out of or otherwise in respect of (i) any inaccuracy in or any
breach of any representation or warranty, of Seller contained in this Agreement
or (ii) the failure of Seller to perform or observe fully any covenant,
agreement or provision to be performed or observed by Seller pursuant to this
Agreement.

         (b) Buyer agrees to indemnify, defend and hold harmless Seller, its
Affiliates and, if applicable, its respective directors, officers, shareholders,
employees, attorneys, accountants, agents and representatives and their heirs,
successors and assigns from and against any and all Damages based upon, arising
out of or otherwise in respect of (i) any inaccuracy in or any breach of any
representation or warranty, of Buyer contained in this Agreement, or (ii) the
failure of Buyer to perform or observe fully any covenant, agreement or
provision to be performed or observed by Buyer pursuant to this Agreement.

                                  ARTICLE VIII

                                  MISCELLANEOUS

8.1 Notices.
    --------

         Any notice or other communications hereunder must be in writing and
shall be deemed to have been duly given and received on the day on which it is
served by personal delivery upon the party for whom it is intended, on the third
Business Day after it is mailed by registered or certified mail, return receipt
requested, on the Business Day after it is delivered to a national courier
service for next day delivery addressed to the party for whom it is intended, or
on the Business Day on which it is sent by facsimile; provided that the telecopy
is promptly confirmed by telephone confirmation thereof, to the person at the
address set forth below, or such other address as may be designated in writing
hereafter, in the same manner, by such person:

                  To Buyer:

                   Ultrapetrol (Bahamas) Limited
                   Ocean Centre, Montague Foreshore
                   East Bay St.

                                       15

                   Nassau, Bahamas
                   P.O. Box SS-19084
                   Attn:  Assistant Secretary
                   Facsimile:  (242) 394-8430

                   To Seller:

                   LAIF XI Ltd.
                   29 Richmond Road
                   Pembroke, HM 08
                   Bermuda
                   Attn: Mark Waddington
                   Facsimile: (441) 295-6983

                   With a copy to:

                   EMP Global L.L.C.
                   2001 Pennsylvania Avenue, N.W.
                   Suite 1100
                   Washington, D.C.  20006
                   Attn: James F. Martin/Michael P. Kelley
                   Facsimile: (202) 293-7163

8.2 Entire Agreement.
    -----------------

         This Agreement (including the Exhibit and Schedules attached hereto or
referred to herein) contains the entire agreement among the parties hereto with
respect to the subject matter hereof and thereof and supersede all prior
agreements, written or oral, with respect thereto.

8.3 Waivers and Amendments; Non-Contractual Remedies; Preservation of Remedies.
    ---------------------------------------------------------------------------

         This Agreement may be amended, superseded, cancelled, renewed or
extended, and the terms hereof may be waived, only by a written instrument
signed by the parties or, in the case of a waiver, by the party waiving
compliance. No delay on the part of either Seller or Buyer in exercising any
right, power or privilege hereunder shall operate as a waiver thereof, nor shall
any waiver on the part of either Seller or Buyer of any such right, power or
privilege, or any single or partial exercise of any such right, power or
privilege, preclude any further exercise thereof or the exercise of any other
such right, power or privilege.

8.4 Assignability; Binding Effect.
    ------------------------------

         This Agreement shall inure to the benefit of and be binding upon the
parties hereto and their respective successors and assigns; provided, however,
that this Agreement and the rights and obligations of the parties hereunder
shall not be assignable by a party hereto without the prior written consent of
the other party.

                                       16

8.5 Governing Law; Submission to Jurisdiction Waiver of Jury Trial.
    ---------------------------------------------------------------

         (a) THE INTERPRETATION AND PERFORMANCE OF THIS AGREEMENT SHALL BE
CONTROLLED BY AND CONSTRUED UNDER THE LAWS OF THE STATE OF NEW YORK WITHOUT
REGARD TO CONFLICTS OF LAWS PRINCIPLES.

         (b) ANY JUDICIAL PROCEEDING BROUGHT WITH RESPECT TO THIS AGREEMENT MUST
BE BROUGHT IN THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW
YORK OR ANY COURT OF COMPETENT JURISDICTION IN THE STATE OF NEW YORK LOCATED IN
THE CITY OF NEW YORK, AND, EACH PARTY: (I) ACCEPTS UNCONDITIONALLY, THE
EXCLUSIVE JURISDICTION OF SUCH COURTS AND ANY RELATED APPELLATE COURT, AND
AGREES TO BE BOUND BY ANY FINAL, NON-APPEALABLE JUDGMENT RENDERED THEREBY IN
CONNECTION WITH THIS AGREEMENT; (II) IRREVOCABLY WAIVES ANY OBJECTION IT MAY NOW
OR HEREAFTER HAVE AS TO THE VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT
IN SUCH A COURT OR THAT SUCH COURT IS AN INCONVENIENT FORUM PROVIDED, HOWEVER,
THAT SUCH CONSENT TO JURISDICTION IS SOLELY FOR THE PURPOSE REFERRED TO IN THIS
SECTION 7.5 (B) AND SHALL NOT BE DEEMED TO BE A GENERAL SUBMISSION TO THE
JURISDICTION OF SAID COURTS OR THE STATE OF NEW YORK OTHER THAN FOR SUCH
PURPOSE; AND (III) AGREES THAT PROCESS IN ANY SUCH ACTION, IN ADDITION TO ANY
OTHER METHOD PERMITTED BY LAW, MAY BE SERVED UPON IT BY REGISTERED OR CERTIFIED
MAIL, RETURN RECEIPT REQUESTED, ADDRESSED TO SUCH PARTY AT THE ADDRESS
DESIGNATED BY SUCH PARTY IN SECTION 7.1 HEREOF, AND SUCH SERVICE SHALL BE DEEMED
EFFECTIVE AS IF PERSONAL SERVICE HAD BEEN MADE UPON IT WITHIN NEW YORK COUNTY.

         (c) THE PARTIES HEREBY WAIVE TRIAL BY JURY IN ANY JUDICIAL PROCEEDING
TO WHICH THEY ARE PARTIES INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER ARISING
OUT OF, RELATED TO OR IN CONNECTION WITH THIS AGREEMENT.

8.6 Counterparts.
    -------------

         This Agreement may be executed in any number of counterparts, each of
which shall be an original but all of which together shall constitute one and
the same instrument.

8.7 Further Assurances.
    -------------------

         Each of Seller and Buyer shall, at the request of the other party, at
any time and from time to time following the Closing promptly execute and
deliver, or cause to be executed and delivered, all such further instruments and
take all such further action as each party may reasonably request to confirm or
carry out the provisions and intent of this Agreement.

                                       17

8.8 Severability.
    -------------

         Any provision of this Agreement that 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 in any
jurisdiction shall (to the full extent permitted by law) not invalidate or
render unenforceable such provision in any other jurisdiction.

8.9 Exhibit and Schedules.
    ----------------------

         All Schedules and Exhibits attached hereto are hereby incorporated in
and made a part of this Agreement as if set forth in full herein. All references
herein to the Exhibits and Schedules shall be deemed references to such parts of
this Agreement, unless the context shall otherwise require.

8.10 Captions.
     ---------

         The article and section titles or captions contained in this Agreement
or in any Schedule or Exhibit attached hereto or referred to herein are for
convenience only, shall not be deemed a part of this Agreement and shall not
affect the meaning or interpretation of this Agreement. All references herein to
Sections shall be deemed references to such parts of this Agreement, unless the
context shall otherwise require.

8.11 Interpretation.
     ---------------

         The words "hereof", "herein" and "hereunder" and words of similar
import, when used in this Agreement, shall refer to this Agreement as a whole
and not to any particular provision of this Agreement. The terms "Dollars" and
"$" shall mean United States dollars. Personal pronouns, when used in this
Agreement, whether in the masculine, feminine or neuter gender, shall include
all other genders, and the singular shall include the plural, and vice versa.

8.12 Third Parties.
     --------------

         Except as specifically set forth or referred to herein, nothing herein
expressed or implied is intended or shall be construed to confer upon or give to
any Person other than the parties hereto and their successors or assigns and the
beneficiaries of contractual indemnification expressly set forth herein, any
rights or remedies under or by reason of this Agreement.

8.13 Expenses.
     ---------

         Buyer shall bear any and all transfer taxes in connection with the sale
and transfer of the LAIF UP Offshore Shares to Buyer. Except as otherwise
provided for in this Agreement, Seller, on the one hand, and Buyer, on the other
hand, shall each pay its respective costs and expenses incurred by each of them
or on their behalf in connection with the negotiation, execution and delivery of
this Agreement and the transactions contemplated hereby, including, without
limitation, the fees and expenses of their own financial consultants,
accountants and counsel.

                                       18

8.14 Knowledge.
     ----------

         As used in this Agreement, "Knowledge" means the actual knowledge of
the subject entity.

8.15 Specific Performance.
     ---------------------

         The parties agree and acknowledge that money damages are not an
adequate remedy for violations of this Agreement and each of Seller and Buyer
may, in its sole discretion, apply to a court of competent jurisdiction for
specific performance of this Agreement.

                                       19

         IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the day and year first above written.

                                              ULTRAPETROL (BAHAMAS) LIMITED

                                              By: /s/ Ricardo Menendez R.
                                                  ------------------------------
                                              Name:  Ricardo Menendez R.
                                              Title: Director

                                              LAIF XI LTD.

                                              By: /s/ James Martin
                                                  ------------------------------
                                              Name:  James Martin
                                              Title: Attorney-in-Fact

                                                                      SCHEDULE I
                                                                      ----------

                                  DEFINED TERMS
                                  -------------

         As used herein, the following terms have the respective meanings set
forth below or set forth in the Section hereof following such term:

         "Affiliate" means, at any time, and with respect to any Person, (a) any
other Person that at such time directly or indirectly through one or more
intermediaries Controls, or is Controlled by, or is under common Control with,
such first Person, and (b) any Person beneficially owning or holding, directly
or indirectly, 50% or more of any class of voting or equity interests of UP
Offshore or any Subsidiary or any Person of which UP Offshore and its
Subsidiaries beneficially own or hold, in the aggregate, directly or indirectly,
50% or more of any class of voting or equity interests. As used in this
definition, "Control" means the possession, directly or indirectly, of the power
to direct or cause the direction of the management and policies of a Person,
whether through the ownership of voting securities, by contract or otherwise.
Unless the context otherwise clearly requires, any reference to an "Affiliate"
is a reference to an Affiliate of UP Offshore.

         "Agreement" has the meaning set forth in the preamble.

         "Business Day" means any day other than a Saturday, a Sunday or a day
on which commercial banks in New York City are required or authorized to be
closed.

         "Buyer" has the meaning set forth in the preamble.

         "Capital Lease" means, at any time, a lease with respect to which the
lessee is required concurrently to recognize the acquisition of an asset and the
incurrence of a liability in accordance with GAAP.

         "Closing" has the meaning set forth in Section 1.3.

         "Closing Date" has the meaning as set forth in Section 1.3.

         "Code" means the Internal Revenue Code of 1986, as amended from time to
time, and the rules and regulations promulgated thereunder from time to time.

         "Damages" means any and all losses, liabilities, obligations, demands,
claims, actions, cause of actions, costs, expenses, damages and judgments,
including, without limitation, reasonable attorneys' fees and expenses.

         "ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and the rules and regulations promulgated thereunder
from time to time in effect.

         "Environmental Laws" means any and all Federal, state, local, and
foreign statutes, laws, regulations, ordinances, rules, judgments, orders,
decrees, permits, concessions,

grants, franchises, licenses, agreements or governmental restrictions relating
to pollution or the protection of the environment including, but not limited to,
ambient air, surface water, ground water, navigable waters, waters of the
contiguous zone, ocean waters and international waters or the release of any
materials into the environment, including but not limited to those related to
hazardous substances or wastes, air emissions and discharges to waste or public
systems.

         "Exchange Act" means the Securities Exchange Act of 1934, as amended
from time to time.

         "Financial Statements" has the meaning set forth in Section 2.11

         "GAAP" means generally accepted accounting principles as in effect from
time to time in the United States of America, consistently applied except as
otherwise disclosed.

         "Governmental Authority" means with respect to any Person,

               (a) the government of

                    (i) the United States of America or any state or other
               political subdivision thereof; or

                    (ii) any jurisdiction in which such Person or any of its
               Subsidiaries conducts all or any part of its business, or which
               asserts jurisdiction over any properties of such Person or any of
               its Subsidiaries; or

               (b) any entity exercising executive, legislative, judicial,
         regulatory or administrative functions of, or pertaining to, any such
         government.

         "Guaranty" means, with respect to any Person, any obligation (except
the endorsement in the ordinary course of business of negotiable instruments for
deposit or collection) of such Person guaranteeing or in effect guaranteeing any
indebtedness, dividend or other obligation of any other Person in any manner,
whether directly or indirectly, including (without limitation) obligations
incurred through an agreement, contingent or otherwise, by such Person:

               (a) to purchase such indebtedness or obligation or any property
         constituting security therefor;

               (b) to advance or supply funds (i) for the purchase or payment of
         such indebtedness or obligation, or (ii) to maintain any working
         capital or other balance sheet condition or any income statement
         condition of any other Person or otherwise to advance or make available
         funds for the purchase or payment of such indebtedness or obligation;

                                       2

               (c) to lease properties or to purchase properties or services
         primarily for the purpose of assuring the owner of such indebtedness or
         obligation of the ability of any other Person to make payment of the
         indebtedness or obligation; or

               (d) otherwise to assure the owner of such indebtedness or
         obligation against loss in respect thereof.

         In any computation of the indebtedness or other liabilities of the
obligor under any Guaranty, the indebtedness or other obligations that are the
subject of such Guaranty shall be assumed to be direct obligations of such
obligor.

         "Hazardous Material" means any and all pollutants, toxic or hazardous
wastes or any other substances that might pose a hazard to health or safety, the
removal of which may be required or the generation, manufacture, refining,
production, processing, treatment, storage, handling, transportation, transfer,
use, disposal, release, discharge, spillage, seepage, or filtration of which is
or shall be restricted, prohibited or penalized by any applicable law.

         "Indebtedness" with respect to any Person means, at any time, without
duplication,

               (a) its liabilities for borrowed money and its redemption
         obligations in respect of mandatorily redeemable Preferred Stock;

               (b) its liabilities for the deferred purchase price of property
         acquired by such Person (excluding accounts payable arising in the
         ordinary course of business but including all liabilities created or
         arising under any conditional sale or other title retention agreement
         with respect to any such property);

               (c) all liabilities appearing on its balance sheet in accordance
         with GAAP in respect of Capital Leases;

               (d) all liabilities for borrowed money secured by any Lien with
         respect to any property owned by such Person (whether or not it has
         assumed or otherwise become liable for such liabilities);

               (e) all its liabilities in respect of letters of credit or
         instruments serving a similar function issued or accepted for its
         account by banks and other financial institutions (whether or not
         representing obligations for borrowed money);

               (f) Swaps of such Person; and

               (g) any Guaranty of such Person with respect to liabilities of a
         type described in any of clauses (a) through (f) hereof.

                                       3

         Indebtedness of any Person shall include all obligations of such Person
of the character described in clauses (a) through (g) to the extent such Person
remains legally liable in respect thereof notwithstanding that any such
obligation is deemed to be extinguished under GAAP.

         "Indemnified Party" has the meaning set forth in Section 7.3.

         "Indemnifying Party" has the meaning set forth in Section 7.3.

         "IPO" has the meaning set forth in Section 1.2.

         "Intellectual Property" means all of the following: patents, patent
rights, copyrights, works which are the subject matter of copyrights,
trademarks, tradenames, tradestyles, patent and trademark applications and
licenses and rights thereunder, and all other rights under any of the foregoing,
all extensions, renewals, reissues, divisions, continuations, and
continuations-in-part of any of the foregoing, and all rights to sue for past,
present, and future infringement of any of the foregoing; inventions, trade
secrets, formulae, processes, compounds, drawings, designs, blueprints, surveys,
reports, manuals, and operating standards; goodwill, customer and other lists,
in whatever form maintained; and trade secret rights, copyright rights, patent
rights, rights in works of authorship, and contract rights relating to computer
software programs, in whatever form created or maintained.

         "Intellectual Property Rights" means the rights or interest of any
Person in or to any Intellectual Property.

         "Legal Requirement" means all laws, statutes, codes, acts, ordinances,
orders, judgments, decrees, injunctions, rules, regulations, permits, licenses,
authorizations, directions and requirements of Governmental Authorities.

         "Lien" means, with respect to any Person, any mortgage, lien, pledge,
charge, security interest or other encumbrance or rights of others, or any
interest or title of any vendor, lessor, lender or other secured party to or of
such Person under any conditional sale or other title retention agreement or
Capital Lease, upon or with respect to any property or asset of such Person
(including in the case of stock, stockholder agreements, voting trust agreements
and all similar arrangements).

         "Material" means material in relation to the business, operations,
affairs, financial condition, assets, properties, or prospects of UP Offshore.

         "Material Adverse Effect" means with respect to a Person, a material
adverse effect on (a) the business, operations, affairs, financial condition,
assets, properties or prospects of such Person and its Subsidiaries taken as a
whole, or (b) the ability of such Person to perform its obligations under this
Agreement, or (c) the validity or enforceability of this Agreement.

         "Material Contract" means:

                                       4

               (i)  any agreement for the lease of personal property to or from
                    UP Offshore providing for lease payments in excess of
                    [$10,000] per annum;

               (ii) any agreement for the purchase or sale of raw materials,
                    commodities, supplies, products, or other personal property,
                    or for the furnishing or receipt of services, the
                    performance of which will extend over a period of more than
                    one year or involve consideration in excess of [$10,000];

               (iii) any agreement concerning a partnership or joint venture;

               (iv) any agreement under which UP Offshore has created, incurred,
                    assumed, or guaranteed any indebtedness for borrowed money,
                    or any capitalized lease obligation, in excess of [$10,000]
                    or under which it has granted a Lien with respect to any of
                    its assets;

               (v)  any collective bargaining agreement;

               (vi) any agreement for the employment of any individual on a
                    full-time, part-time, consulting, or other basis providing
                    annual compensation in excess of [$50,000]; and

               (vii) any other agreement the performance of which involves
                    consideration in excess of [$10,000].

         "Notice of Claim" has the meaning set forth in Section 7.3.

         "Person" means an individual, partnership, corporation, limited
liability company, association, trust, unincorporated organization, or any other
company or entity or a government or agency or political subdivision thereof.

         "Plan" means any employee benefit plan as defined in Section 3(3) of
ERISA.

         "Preferred Stock" means any class of capital stock or other equity
interests of a Person that is preferred over any other class of capital stock or
equity interests of such Person as to the payment of dividends or the payment of
any amount upon liquidation or dissolution of such Person.

         "Purchase Price" has the meaning set forth in Section 1.2.

         "Securities Act" means the Securities Act of 1933, as amended from time
to time.

         "Seller" has the meaning set forth in the preamble.

         "Shareholders Agreement" has the meaning set forth in Section 2.5(a).

                                       5

         "Subsidiary" means, as to any Person, any corporation, association or
other business entity in which such Person or one or more of its Subsidiaries or
such Person and one or more of its Subsidiaries owns sufficient equity or voting
interests to enable it or them (as a group) ordinarily, in the absence of
contingencies, to elect a majority of the directors (or Persons performing
similar functions) of such entity, and any partnership, limited liability
company or joint venture if more than a 50% interest in the profits or capital
thereof is owned by such Person or one or more of its Subsidiaries or such
Person and one or more of its Subsidiaries (unless such partnership, limited
liability company or joint venture can and does ordinarily take major business
actions without the prior approval of such Person or one or more of its
Subsidiaries). Unless the context otherwise clearly requires, any reference to a
"Subsidiary" is a reference to a Subsidiary of UP Offshore.

         "Swaps" means, with respect to any Person, payment obligations with
respect to interest rate swaps, currency swaps and similar obligations
obligating such Person to make payments, whether periodically or upon the
happening of a contingency. For the purposes of this Agreement, the amount of
the obligation under any Swap shall be the amount determined in respect thereof
as of the end of the then most recently ended fiscal quarter of such Person,
based on the assumption that such Swap had terminated at the end of such fiscal
quarter, and in making such determination, if any agreement relating to such
Swap provides for the netting of amounts payable by and to such Person
thereunder or if any such agreement provides for the simultaneous payment of
amounts by and to such Person, then in each such case, the amount of such
obligation shall be the net amount so determined.

         "Taxes" means (A) all income taxes (including any tax on or based upon
net income, gross income, income as specially defined, earnings, profits or
selected items of income, earnings or profits) and all gross receipts, sales,
use, ad valorem, transfer, franchise, license, withholding, payroll, employment,
excise, severance, stamp, occupation, premium, property or windfall profits
taxes, alternative or add-on minimum taxes, customs duties and other taxes of
any kind whatsoever, together with all interest and penalties, additions to tax
and other additional amounts imposed by any taxing authority (domestic or
foreign) on such entity, and (B) any liability for the payment of any amount of
the type described in the immediately preceding clause (A) as a result of being
a "transferee" (within the meaning of Section 6901 of the Code or any other
applicable law) of another entity, a member of an affiliated or combined group,
a contract or otherwise.

         "UP Offshore Shares" has the meaning set forth in the second recital.

                                       6

                                  SCHEDULE 2.5
                             SHAREHOLDERS CONTRACTS

1.   Amended and Restated Common Subscription Agreement dated as of December 5,
     2003 by and among Buyer, Seller, Comintra and UP Offshore.

2.   Amended and Restated Common Shareholders Agreement, dated as of December 5,
     2003 by and among, Buyer, Seller, Comintra and UP Offshore.

3.   Preference Shareholders Agreement, dated June 24, 2003 by and among IFC,
     Seller, Buyer, Ultrapetrol, Comintra and UP Offshore.

4.   Preference Subscription Agreement, dated as of June 24, 2003 by and between
     IFC and UP Offshore and the Warrant Agreement, dated June 4, 2003.

5.   Warrant Agreement dated June 4, 2003 between UP Offshore (Bahamas) Ltd. and
     Ultrapetrol (Bahamas) Ltd.

                                  SCHEDULE 2.6
                                  SUBSIDIARIES

                                                                   -----------------------
                                                                   |UP Offshore (Bahamas)|
                                                                   |        Ltd.         |----------------------
                                                                   |     (Bahamas)       |                     |
                                                                   -----------------------                     |
                                                                             |                                 |
                                               |-------------------|---------|-------------------|             |
                                         100%  |             100%  |         |              100%  |            |0.01%
                                              \|/                 \|/        |                   \|/           |
                                    ---------------------- ---------------   | 1%      ---------------------   |
                                    |UP Offshore (Panama)| | UP Offshore |   |-------  |UP Offshore Uruguay|   |
                                    |        S.A.        | |  (Holdings) |          |  |        S.A        |   |
                                    |     (Panama)       | |     Ltd.    |          |  |     (Uruguay)     |   |
                                    ---------------------- ---------------          |  ---------------------   |
                                               |                                    |                          |
            |----------------|-----------------|-------------------|                |--------------------------|
      100%  |           100% |            100% |                   | 100%           |  99%              99.99% |
           \|/              \|/               \|/                 \|/              \|/                        \|/
-------------------- -----------------  ----------------  ------------------ ----------------------- -------------------
|Pampero Navigation| |Packet Maritime|  |Padow Shipping|  |UP Offshore (UK)| |Agriex Agenciamentos,| |UP Offshore Apoio|
|        Inc.      | |      Inc.     |  |      Inc.    |  |      Ltd.      | |   Afretamentos e    | |  Maritimo Ltda. | ---
|     (Panama)     | |   (Panama)    |  |   (Panama)   |  |(United Kingdom | |Apoio Maritimo Ltda. | |     (Brazil)    |    |
-------------------- -----------------  ----------------  ------------------ |     (Brazil)        | ------------------     |
                             |                 |                             -----------------------   |       |            |
                             |                 |                                                       |       |            |
                             |                 |                                      -----------------        |            |
                            \|/               \|/                                    \|/                      \|/          \|/
                     -----------------  -----------------                    --------------- -------------------  -----------------
                     | UP ESMERALDA  |  |   UP SAFIRA   |                    |UP TOPAZIO + | |UP Offshore Apoio|  |UP AGUA-MARINHA|
                     |   FMV: $24    |  |   FMV: $24    |                    |  2 PSV TBN  | |    Maritimo     |  |      FMV: $24 |
                     |Balance:[$28.4 |  |Balance: $24.8 |                    |  FMV: $72   | |  (Panama) Inc.  |  | Balance: $14.9|
                     -----------------  -----------------                    |    FREE     | |   (Panama)      |  |               |
                                                                             --------------- -------------------  -----------------

1   Agriex Agenciamentos, Afretamentos e Apoio Maritimo Ltda.       Brasil
2   Packet Maritime Inc.                                            Panama
3   Padow Shipping Inc.                                             Panama
4   Pampero Navigation Inc                                          Panama
5   UP Offshore (Holdings) Ltd                                      Bahamas
6   UP Offshore (Panama) SA                                         Panama
7   UP Offshore (UK) Ltd.                                           UK
8   UP Offshore Apoio Maritimo (Panama) Inc.                        Panama
9   UP Offshore Apoio Maritimo Ltda.                                Brasil
10  UP Offshore Uruguay S.A.                                        Uruguay

SCHEDULE 2.8(a)

                                  ASSETS

      VESSEL NAME          FLAG            OWNER                       YR BUILT

1   UP ESMERALDA           PANAMA   PACKET MARITIME INC.                  2005
2   UP SAFIRA              PANAMA   PADOW SHIPPING INC.                   2005
3   UP AGUA-MARINHA        BRASIL   UP OFFSHORE APOIO MARITIMO LTDA.      2005
4   UP TOPAZIO             BRASIL   UP OFFSHORE APOIO MARITIMO LTDA.  est 2006
5   EI 483                 BRASIL   UP OFFSHORE APOIO MARITIMO LTDA.  est 2006
6   EI 483                 BRASIL   UP OFFSHORE APOIO MARITIMO LTDA.  est 2007

    LOA M     BEAM M     DEPTH M    GRT     NRT     HP     CLASSIFICATION

1   75.78      16.6        7.8     2,919   1,371  3,418   LLOYD'S REGISTER
2   75.78      16.6        7.8     2,919   1,371  3,418   LLOYD'S REGISTER
3   75.78      16.6        7.8     2,927   1,371  3,418   DET NORSKE VERITAS
4   75.78      16.6        7.8     2,927   1,371  3,418   DET NORSKE VERITAS
5   75.78      16.6        7.8     2,927   1,371  3,418   DET NORSKE VERITAS
6   75.78      16.6        7.8     2,927   1,371  3,418   DET NORSKE VERITAS

                                       2

SCHEDULE 2.8(b)

                            REAL PROPERTY/LEASEHOLDS
                          EDIFICIO LEBLON OFFICE TOWER
                        AVENIDA ATAULFO DE PAIVA NO 1235
                             RIO DE JANEIRO, BRAZIL

UP OFFSHORE APOIO MARITIMO LTDA. / RENTAL CONTRACT OF SUITE 301 - OWNER: PAULO
RICARDO FONSECA DE MAGALHAES
Term: 30 months
Starts: January 6, 2004
End: July 5, 2006
Rent: R$ 4,500 (Brazilian Reais four thousand and five hundred) payable monthly
Penalty on rent due: 10% on balance due
% interest on rent due (after 30 days): 1% (monthly) (adjusted by inflation)

Rent is reviewed on a yearly basis. UP Offshore is to pay following expenses:
electricity, natural gas, tap water, etc.

UP OFFSHORE APOIO MARITIMO LTDA. / RENTAL CONTRACT FOR SUITE 302 - OWNER:
CANDIDO JOSE FONSECA DE MAGALHAES
Term: 30 months
Starts: January 6, 2004
End: July 6, 2006
Rent: R$ 2,500 (Brazilian Reais two thousand and five hundred) payable monthly
Penalty on rent due: 10% on balance due
% interest on rent due (after 30 days): 1% (monthly) (adjusted by inflation)

Rent is reviewed on a yearly basis. UP Offshore is to pay following expenses:
electricity, natural gas, tap water, etc.

UP OFFSHORE APOIO MARITIMO LTDA. / RENTAL CONTRACT OF SUITES 304 - 305 - OWNER
SUELI APARECIDA GONCALVES
Term: 30 months + 30 months automatic extension except prior notice
Starts: January 15, 2004
End: June 15, 2006
Rent: R$ 5,400 (Brazilian Reais five thousand and four hundred) payable monthly
as a total for both offices
Penalty on rent due: 10% on balance due
% interest on rent due (after 30 days): 1% (monthly) (adjusted by inflation)

                                       3

UP OFFSHORE APOIO MARITIMO LTDA. / RENTAL CONTRACT FOR SUITE 303 - OWNER: DENIS
BRUCE BOGGISS
Term: 30 months
Starts: January 6, 2004
End: July 6, 2006
Rent: R$ 2,500 (Brazilian Reais two thousand and five hundred) payable monthly
Penalty on rent due: 10% on balance due
% interest on rent due (after 30 days): 1% (monthly) (adjusted by inflation)

Rent is reviewed on a yearly basis. UP Offshore is to pay following expenses:
electricity, natural gas, tap water, etc.

Rest of the terms in all four contracts are as per industry standard

                                       4

SCHEDULE 2.10

                         INDEBTEDNESS; OTHER LIABILITES

o    LOAN AGREEMENT (1) DATED 27TH APRIL 2005                  o   LOAN AGREEMENT (2) DATED 17TH JANUARY 2006

     DVB BANK AG (LENDER)                                          DVB BANK AG (LENDER
     UP OFFSHORE (PANAMA) S.A. (BORROWER)                          UP OFFSHORE APOIO MARITIMO LTDA (BORROWER

     AMOUNT $30 MILLION                                            AMOUNT $15 MILLION

     SECURED BY 1ST PANAMANIAN MORTGAGES                           SECURED BY 1ST BRASILIAN MORTGAGES
     UP ESMERALDA                                                  UP AGUA-MARINHA
     UP SAFIRA
     UP SAFIRA                                                     SECURED BY 2ND PANAMANIAN MORTGAGE
                                                                   UP ESMERALDA
                                                                   UP SAFIRA

o    SHIPBUILDING CONTRACT FOR HULL # EI 482 (UP TOPAZIO)      o   LOAN AGREEMENT DATED 3RD DECEMBER 2002\
o    SHIPBUILDING CONTRACT FOR HULL # EI 483 (UP TBN)              BEWEEN IFC (LENDER) AND
o    SHIPBUILDING CONTRACT FOR HULL # E1 484 (UP TBN)              UP OFFSHORE APOIO MARITIMO LTDA (BORROWER)
                                                                   TO FINANCE THE BRAZILIAN NEWBUILDINGS
                                                                   (UNDRAWN AS OF THE DATE HEREOF)

     DATED 9TH JUNE 2003
     BETWEEN ESTALEIRO ILHA S/A (BUILDER)                      o   PREFERENCE SHAREHOLDER AGREEMENT DATED
     AND UP OFFSHORE APOIO MARITIMO LTDA (BUYER)                   JUNE 24, 2003 BY AND BETWEEN INTERNATIONAL
                                                                   FINANCE CORPORATION, LAIF XI LTD., ULTRAPETROL
                                                                   (BAHAMAS) LTD., COMINTRA ENTERPRISE LTD. AND
                                                                   UP OFFSHORE (BAHAMAS) LTD.

     AS AMENDED 22ND NOVEMBER 2005

                                       5

SCHEDULE 2.11
                               MATERIAL CONTRACTS

1.   SHIPBUILDING CONTRACT FOR HULL # EI 482 (UP TOPAZIO)
     SHIPBUILDING CONTRACT FOR HULL # EI 483 (UP TBN)
     SHIPBUILDING CONTRACT FOR HULL # EI 484 (UP TBN)

DATED 9TH JUNE 2003

BETWEEN ESTALEIRO ILHA S/A (BUILDER) AND UP OFFSHORE APOIO MARITIMO LTDA (BUYER)

AS AMENDED 22ND NOVEMBER 2005

2.   TIMECHARTER FOR UP AGUA-MARINHA DATED FEBRUARY 20, 2006

PETROLEO BRASILEIRO S.A. (PETROBRAS) (CHARTERER)

UP OFFSHORE APOIO MARITIMO LTDA (OWNER) FOR A PERIOD OF SIX MONTHS FROM MARCH
2006

3.   (A) BAREBOAT CHARTER AGREEMENT DATED JANUARY 25, 2005 FOR UP ESMERALDA
     BETWEEN PACKET MARITIME INC (OWNER) AND CORNAMUSA (DEMISE OWNER)

3.   (B) BAREBOAT CHARTER AGREEMENT DATED FEBRUARY 26, 2005 FOR UP SAFIRA
     BETWEEN PADOW SHIPPING INC (OWNER) AND CORNAMUSA (DEMISE OWNER)

4.   SHIP MANAGEMENT AGREEMENT DATED 20TH MARCH 2006 FOR UP AGUA-MARINHA BEWTEEN
     RAVENSCROFT SHIP MANAGEMENT INC (MANAGER) AND UP OFFSHORE APOIO MARITIMO
     LTDA (OWNER)

5.   ADMINISTRATION AGREEMENT DATED 25TH JUNE, 2003 BETWEEN UP OFFSHORE
     (BAHAMAS) LTD. AND ULTRAPETROL (BAHAMAS) LTD.

                                       6

                                  SCHEDULE 2.14
                                    EMPLOYEES

Carolina Januzzi, Secretary
Renata Sanchez - Keyboard Operator
Ana Maria Siva - Maid, cleaner and coffee girl
Marcelo Helman - Commercial Assistant, Brazil Operations

                                  SCHEDULE 2.15
                          TRANSACTIONS WITH AFFILIATES

1.   (A) BAREBOAT CHARTER AGREEMENT DATED JANUARY 25, 2005 FOR UP ESMERALDA
     BETWEEN PACKET MARITIME INC (OWNER) AND CORNAMUSA (DEMISE OWNER)

1.   (B) BAREBOAT CHARTER AGREEMENT DATED FEBRUARY 26, 2005 FOR UP SAFIRA
     BETWEEN PADOW SHIPPING INC (OWNER) AND CORNAMUSA (DEMISE OWNER)

2.   ADMINISTRATION AGREEMENT DATED 25TH JUNE, 2003 BETWEEN UP OFFSHORE
     (BAHAMAS) LTD AND ULTRAPETROL (BAHAMAS) LTD

3.   WARRANT AGREEMENT DATED 4TH JUNE, 2003 BETWEEN UP OFFSHORE (BAHAMAS) LTD
     AND ULTRAPETROL (BAHAMAS) LTD.

4.   SHIP MANAGEMENT AGREEMENT DATED 20TH MARCH 2006 FOR UP AGUA-MARINHA BETWEEN
     RAVENSCROFT SHIP MANAGEMENT INC (MANAGER)
     AND UP OFFSHORE APOIO MARITIMO LTDA (OWNER)

5.   PREFERENCE SUBSCRIPTION AGREEMENT DATED JUNE 24, 2003 BETWEEN THE IFC AND
     UP OFFSHORE (BAHAMAS) LTD

6.   PREFERENCE SHAREHOLDERS AGREEMENT DATED JUNE 24, 2003 BETWEEN THE IFC, LAIF
     XI LTD, ULTRAPETROL (BAHAMAS) LTD, COMINTRA ENTERPRISES LTD, AND UP
     OFFSHORE (BAHAMAS) LTD

7.   AMENDED AND RESTATED COMMON SHAREHOLDERS AGREEMENT DATED DECEMBER 5TH, 2003
     BETWEEN LAIF XI LTD, ULTRAPETROL (BAHAMAS) LTD, COMINTRA ENTERPRISES LTD,
     AND UP OFFSHORE (BAHAMAS) LTD

                                       2

                                                                       EXHIBIT A

                                 PROMISSORY NOTE

New York, New York                                                 US$48,000,000

                                                                  March 21, 2006

         FOR VALUE RECEIVED, the undersigned, ULTRAPETROL (BAHAMAS) LIMITED, a
corporation organized and existing under the laws of The Bahamas (the "Buyer"),
hereby promises to pay to the order of LAIF XI LTD., a company organized under
the laws of Bermuda (the "Seller"), or as it may otherwise direct, the principal
sum of Forty-Eight Million United States Dollars (US$48,000,000). The Borrower
shall repay the indebtedness represented by this Note as provided in that
certain stock purchase agreement dated as of March 21, 2006 (the "Stock Purchase
Agreement") made by and between (i) the Buyer and (ii) the Seller. This Note
shall not bear interest, and may be prepaid on such terms as provided in the
Stock Purchase Agreement.

         Words and expressions used herein and defined in the Stock Purchase
Agreement shall have the same meaning herein as therein defined.

         This Note is payable in U.S. Dollars to the Seller, as the Seller may
direct, in immediately available same day funds.

         If this Note or any payment required hereunder becomes due and payable
on a day which is not a Banking Day the due date thereof shall be extended until
the next following Banking Day, unless such next following Banking Day falls in
the following month, in which case such payment shall be payable immediately
preceding the Banking Day.

         This Note is the Note referred to in, and is entitled to the security
and benefits of, the Stock Purchase Agreement and the Pledge Agreement referred
to therein.

         Presentment, demand, protest and notice of dishonor of this Note or any
other notice of any kind are hereby expressly waived.

         EACH OF THE BUYER AND, BY ITS ACCEPTANCE HEREOF, SELLER HEREBY WAIVES
TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM BROUGHT BY ANY PARTY
HERETO OR ANY BENEFICIARY HEREOF ON ANY MATTER WHATSOEVER ARISING OUT OF OR IN
ANY WAY CONNECTED WITH THIS NOTE.

         This Promissory Note shall be governed by, and construed in accordance
with, the laws of the State of New York, without giving effect to principles of
conflicts of law.

         IN WITNESS WHEREOF, the Buyer has executed and delivered this
Promissory Note on the date and year first above written.

                                                  ULTRAPETROL (BAHAMAS) LIMITED

                                                  By:
                                                      -------------------------
                                                  Name: Leonard J. Hoskinson
                                                  Title: Company Secretary

                                       2

                                                                       EXHIBIT B

                                PLEDGE AGREEMENT

         THIS PLEDGE AGREEMENT (this "Pledge Agreement") is made this 21st day
of March, 2006, by and among ULTRAPETROL (BAHAMAS) LIMITED, a company organized
under the laws of The Bahamas (the "Pledgor), as pledgor, and LAIF XI LTD., a
company organized under the laws of Bermuda (the "Pledgee"), as pledgee,
pursuant to the terms of that certain stock purchase agreement (the "Stock
Purchase Agreement") dated as of March , 2006 made by and between the Pledgor,
as buyer, and the Pledgee, as seller, in connection with the Pledgor's purchase
of 30,000,000 shares of common stock of UP Offshore (Bahamas) Limited ("UP
Offshore" or "Pledged Company").

                                   WITNESSETH:
                                   -----------

         WHEREAS:

         Pursuant to the terms of the Stock Purchase Agreement, the Buyer has
executed and delivered a promissory note (the "Note") of even date herewith in
the amount of $48,000,000 in payment of the purchase price of the Pledged Shares
(as defined below);

         As of the date hereof, the Buyer is the registered and beneficial owner
of 42,499,881 shares of capital stock of UP Offshore of which it is pledging the
30,000,000 of such shares acquired from the Pledgee (the "Pledged Shares");

         Pursuant to the terms of the Stock Purchase Agreement, the Buyer shall
execute and deliver to the Pledgee, as security for the obligations of the Buyer
under the Stock Purchase Agreement and the Note, a pledge of all of Pledgor's
right, title and interest in and to the Pledged Shares;

         NOW, THEREFORE, in consideration of the premises set forth herein, the
Pledgors agree with the Pledgee as follows:

         Defined Terms. Unless otherwise defined herein, terms defined in the
Stock Purchase Agreement shall have the same meanings when used herein.

         Grant of Security. As security for the full and prompt payment of the
Note to the Pledgee and the performance of the Pledgor's obligations under the
Stock Purchase Agreement (collectively, the "Obligations"), the Pledgor hereby
pledges, assigns, transfers and delivers to the Pledgee the Pledged Shares and
hereby grant to the Pledgee a first lien on, and first security interest in, the
Pledged Shares.

         Pledge Documents. Concurrently with the execution of this Pledge
Agreement, the Pledgor shall execute and deliver to the Pledgee an Irrevocable
Proxy in favor of the Pledgee in respect of the Pledged Shares in the form set
out in Exhibit A hereto (the "Irrevocable Proxy") and shall deliver to the
Pledgee the certificates representing the Pledged Shares together with signed,
undated instruments of transfer (the "Instruments of Transfer") pertaining
thereto duly executed in blank.

         Representations and Warranties. The Pledgor represents and warrants
that:

         it is the legal and beneficial owner of, and has good and marketable
title to, its respective Pledged Shares, subject to no pledge, lien, mortgage,
hypothecation, security interest, charge, option or other encumbrance
whatsoever, except the lien and security interest created by this Pledge
Agreement and the delivery of the Pledged Shares to the Pledgee;

         it has full power, authority and legal right to execute, deliver and
perform this Pledge Agreement and to create the collateral security interest for
which this Pledge Agreement provides;

         the Pledged Shares have been duly and validly issued and are fully paid
and nonassessable;

         this Pledge Agreement constitutes a valid obligation of the Pledgor,
legally binding upon it and enforceable in accordance with its terms;

         no consent of any other party that has not been obtained is required in
connection with the execution, delivery, performance, validity, enforceability
or enforcement of this Pledge Agreement, and no consent, license, approval or
authorization of, or registration or declaration with, any governmental
authority, bureau or agency is required in connection with the execution,
delivery, performance, validity, enforceability or enforcement of this Pledge
Agreement; and

         the execution, delivery and performance of this Pledge Agreement will
not violate or contravene any provision of any existing law or regulation or
decree of any court, governmental authority, bureau or agency having
jurisdiction in the premises or of the charter documents of the Pledgor or of
any mortgage, stock purchase agreement, security agreement, contract,
undertaking or other agreement to which the Pledgor is a party or which purports
to be binding upon it or any of its properties or assets and will not result in
the creation or imposition of any lien, charge or encumbrance on, or security
interest in, any of its properties or assets pursuant to the provisions of any
such mortgage, stock purchase agreement, security agreement, contract,
undertaking or other agreement;

         Covenants. The Pledgor hereby covenants that during the continuance of
this Pledge Agreement:

         it shall warrant and defend the right and title of the Pledgee
conferred by this Pledge Agreement in and to its Pledged Shares at the cost of
the Pledgor against the claims and demands of all persons whomsoever;

         except as herein provided, without the prior written consent of the
Pledgee, it shall not sell, assign, transfer, charge, pledge or encumber in any
manner any part of its Pledged Shares or suffer to exist any encumbrance on its
Pledged Shares;

         without the prior written consent of the Pledgee, other than as
contemplated by the Stock Purchase Agreement, it shall not amend or modify any
organizational

                                       2

document, by-law or other corporate governance agreement (including any
shareholders' agreement) relating to the Pledged Company; and

         without the prior written consent of the Pledgee, it shall not vote its
Pledged Shares in favor of the consolidation, merger, dissolution, liquidation
or any other corporate reorganization of the Pledged Company.

         Delivery of Additional Interests. If the Pledgor shall become entitled
to receive or shall receive any share certificates, option or rights, whether as
a dividend in respect of, in substitution of, or in exchange for any of the
Pledged Shares, the Pledgor agrees to accept the same as the agent of the
Pledgee and to hold the same in trust for the benefit of the Pledgee and to
deliver the same forthwith to the Pledgee in the exact form received, with the
endorsement of the Pledgor when necessary and/or appropriate undated instruments
of transfer duly executed in blank, and irrevocable proxy to be held by the
Pledgee, subject to the terms hereof, as additional collateral security for the
Obligations. Any sums paid upon or in respect of the Pledged Shares on the
liquidation or dissolution of any Pledged Company shall be paid over to the
Pledgee to be held by it as additional collateral security for the Obligations.

         Collateral. All property at any time pledged to the Pledgee hereunder
by the Pledgor (whether described herein or not) and all income therefrom and
proceeds thereof, are herein collectively sometimes called the "Collateral".

         Voting Rights. The Pledgee shall, as the Pledgee and as the holder of
the Irrevocable Proxy, receive notice to vote the Pledged Shares at its own
discretion at, any annual or special meeting, as the case may be, of the
shareholders of the Pledged Company, provided, however, that the Pledgee shall
not exercise such right to vote until such time that default shall have occurred
in the payment or performance of the Obligations and not been remedied to the
Pledgee's satisfaction or waived in writing or any of the security created by or
pursuant to this Pledge Agreement shall be imperiled or jeopardized in a manner
deemed material by the Pledgee.

         9. Incorporation by Reference. This Pledge Agreement shall be read
together with the Stock Purchase Agreement, but in the case of any conflict with
the Stock Purchase Agreement, the Stock Purchase Agreement shall prevail.

                                        3

         10. Enforcement/Satisfaction of Obligation. The security constituted by
this Pledge Agreement shall become immediately enforceable if, subject to the
exercise of the Buyer's Put Option contained in the Stock Purchase Agreement,
the Note shall not have been paid and either (i) the IPO shall not have occurred
by September 30, 2006 or (ii) the IPO shall have been abandoned. At any time
after the security constituted by this Pledge Agreement shall have become
enforceable as aforesaid, whereupon the security constituted by this Pledge
Agreement shall become enforceable, the Pledgee shall be entitled, without
further notice to the Pledgor to endorse the Instrument of Transfer in its own
name and to Cause the Company to register the Pledged Shares in the name of the
Pledgee as owner. In such event, the Pledgee hereby acknowledges that such
transfer of the Pledged Shares shall constitute satisfaction of the Obligations
and the Pledgor shall be relieved of any further liability or claim hereunder,
under the Stock Purchase Agreement or under the Note.

         11. No Duty on Pledgee. The Pledgee shall have no duty to exercise any
of the aforesaid rights, privileges or options and shall not be responsible for
any failure to do so or delay in so doing.

         12. Termination. When all of the Obligations shall have been fully
satisfied, or upon the successful completion of the IPO, as such term is defined
in the Stock Purchase Agreement, the Pledgee agrees that it shall forthwith
release each Pledgor from its Obligations hereunder and the Pledgee, at the
request and expense of the Pledgor, will promptly execute and deliver to the
Pledgor a proper instrument or instruments acknowledging the satisfaction and
termination of this Agreement, and the Irrevocable Proxy shall terminate
forthwith and be delivered to such Pledgor forthwith together with the other
items furnished to the Pledgee pursuant to Section 3 hereof.

         13. Changes in Writing; Successors and Assigns. None of the terms or
provisions of this Pledge Agreement may be waived, altered, modified or amended
except by an instrument in writing, duly executed by the Pledgee. This Pledge
Agreement and all obligations of the Pledgor hereunder shall be binding upon the
successors and assigns of the Pledgor and shall, together with the rights and
remedies of the Pledgee hereunder, inure to the benefit of the Pledgee, its
respective successors and assigns.

         14. Notices. Every notice or demand under this Agreement shall be in
writing (including prepaid overnight courier, facsimile transmission or similar
writing). Every notice or demand shall be sent as follows:

If to the Pledgor:         Ultrapetrol (Bahamas) Limited
                           Ocean Centre, Montague Foreshore
                           East Bay St.
                           Nassau, Bahamas
                           P.O. Box SS-19084
                           Attn: Company Secretary
                           Facsimile: (242) 394-8430

If to the Pledgee:         LAIF XI Ltd.
                           29 Richmond Rd.
                           Pembroke, HM 08

                                        4

                           Bermuda
                           Attn: Mark Waddinton
                           Facsimile: (441) 295-6983

With a copy to:            EMP Global L.L.C.
                           2001 Pennsylvania Avenue, N.W.
                           Suite 1100
                           Washington, D.C. 20006
                           Attn: James F. Martin/Michael P. Kelley
                           Facsimile: (202) 293-7163

Each such notice, request or other communication shall be effective (i) if given
by facsimile, when such facsimile is transmitted to the telecopy number
specified in this Section and telephonic confirmation of receipt thereof is
obtained or (ii) if given by mail, prepaid overnight courier or any other means,
when received at the address specified in this Section or when delivery at such
address is refused.

                                        5

         15. Governing Law. This Pledge Agreement shall be governed by and
construed in accordance with the laws of the State of New York without regard to
the principles of conflicts of law thereof.

         16. Submission to Jurisdiction. The Pledgor hereby irrevocably submits
to the jurisdiction of the courts of the State of New York and of the United
States District Court for the Southern District of New York in any action or
proceeding brought against it by the Pledgee under this Pledge Agreement or
under any document delivered hereunder and hereby irrevocably agrees that valid
service of summons or other legal process on it may be effected by serving a
copy of the summons and other legal process in any such action or proceeding on
the Pledgor by mailing or delivering the same by hand to the Pledgor at the
address indicated for notices in Section 19. The service, as herein provided, of
such summons or other legal process in any such action or proceeding shall be
deemed personal service and accepted by the Pledgor as such, and shall be legal
and binding upon the Pledgor for all the purposes of any such action or
proceeding. Final judgment against the Pledgor in any such legal action or
proceeding shall be conclusive and may be enforced in other jurisdictions by
suit on the judgment. The Pledgor will advise the Pledgee promptly of any change
of address for the purpose of service of process. Notwithstanding anything
herein to the contrary, the Pledgee may bring any legal action or proceeding in
any other appropriate jurisdiction.

         17. WAIVER OF JURY TRIAL. THE PLEDGOR AND THE PLEDGEE HEREBY WAIVES
TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM BROUGHT BY ANY PARTY
HERETO OR ANY BENEFICIARY HEREOF ON ANY MATTER WHATSOEVER ARISING OUT OF OR IN
ANY WAY CONNECTED WITH THIS PLEDGE AGREEMENT.

         18. Severability. If any provision hereof is invalid and unenforceable
in any jurisdiction, then, to the fullest extent permitted by law, (i) the other
provisions hereof shall remain in full force and effect in such jurisdiction and
shall be liberally construed in favor of the Pledgees in order to carry out the
intentions of the parties hereto as nearly as may be possible; and (ii) the
invalidity and unenforceability of any provision hereof in any jurisdiction
shall not affect the validity or enforceability of such provision in any other
jurisdiction.

         19. Counterparts. This Pledge Agreement may be signed in any number of
counterparts, each of which shall be deemed an original and all of which shall
constitute one and the same instrument.

         20. Headings. In this Pledge Agreement, Section headings are inserted
for convenience of reference only and shall be ignored in the interpretation of
this Pledge Agreement.

                                       6

         IN WITNESS whereof, the parties hereto have caused this Pledge
Agreement to be duly executed the day and year first above written.

                                ULTRAPETROL (BAHAMAS) LIMITED

                                By: /s/ Ricardo Menendez R.
                                    ----------------------------------------
                                    Name: Ricardo Menendez
                                    Title: Director

                                LAIF XI LTD.

                                By: /s/ James F. Martin
                                    ----------------------------------------
                                    Name: James F. Martin
                                    Title: Attorney-in-Fact

                                       7

                                                                       EXHIBIT A
                                                                       ---------
                                IRREVOCABLE PROXY

         The undersigned, the registered and beneficial owner of the below
described shares of capital stock of UP Offshore (Bahamas) Ltd., a company
incorporated under the laws of Bahamas (the "Company"), hereby makes,
constitutes and appoints LAIF XI, Ltd., (the "Pledgee") with full power to
appoint a nominee or nominees to act hereunder from time to time, the true and
lawful attorney and proxy of the undersigned to vote the 30,000,000 shares of
the issued and outstanding shares of capital stock in the Company represented by
Certificate(s) No. _________at all annual and special meetings of members of the
Company or take any action by written consent with the same force and effect as
the undersigned might or could do, hereby ratifying and confirming all that the
said attorney or its nominee or nominees shall do or cause to be done by virtue
hereof.

         The said stock has been pledged (the "Pledge") to the Pledgee pursuant
to a Pledge Agreement dated the date hereof between the undersigned and the
Pledgee.

         This power and proxy is coupled with an interest and is irrevocable and
shall remain irrevocable so long as the Pledge is outstanding and is in full
force and effect.

         IN WITNESS whereof, the undersigned has caused this instrument to be
duly executed this [ ] day of March , 2006.

                                         ULTRAPETROL (BAHAMAS) LIMITED.

                                         By:
                                             -----------------------------
                                             Name:
                                             Title:

                                       8

                                                              September 21, 2006

 LAIF XI Ltd.
 29 Richmond Road
 Pembroke, HM 08
 Bermuda

         RE: LETTER AGREEMENT REGARDING STOCK PURCHASE AGREEMENT BY AND
             BETWEEN ULTRAPETROL (BAHAMAS) LIMITED AND LAIF XI LTD.

Ladies and Gentlemen:

     We refer to that certain stock purchase agreement, dated as of March 21,
2006 (the "Stock Purchase Agreement"), by and between (i) ULTRAPETROL (BAHAMAS)
LIMITED, a Bahamas corporation ("Buyer"), as buyer and (ii) LAIF XI LTD., a
Bermudan company ("Seller"), as seller. Unless otherwise defined herein, terms
defined in the Stock Purchase Agreement shall have the same meanings when used
herein.

     This letter agreement will confirm that in accordance with Section 8.3 of
the Stock Purchase Agreement and at our request, the Seller hereby consents to
amend (i) Sections 1.2, 5.1(ii), 5.3 and 10 of the Stock Purchase Agreement,
replacing "September 30, 2006" with "October 31, 2006" in each instance; (ii)
Section 5.3 of the Stock Purchase Agreement, replacing "September 23, 2006" with
"October 24, 2006" and (iii) Section 5.4 of the Stock Purchase Agreement,
replacing "September 15, 2006" with "October 21, 2006".

     This will further confirm that, except as expressly affected hereby, the
Stock Purchase Agreement is in all respects ratified and confirmed and all
terms, provisions and conditions thereof shall remain in full force and effect.

     Please signify your agreement to the foregoing by countersigning this
letter in the space provided. This letter agreement may be executed in any
number of counterparts, each of which shall be an original and all of which,
when taken together, shall constitute one agreement. Delivery of an executed
counterpart of a signature page of this letter agreement by facsimile
transmission shall be effective as delivery of a manually executed counterpart
hereof. This letter agreement shall be governed by, and construed in accordance
with, the laws of the State of New York. Kindly indicate your acceptance and
agreement with the foregoing by executing this letter in the space indicated
below.

                                               Yours faithfully,

                                               ULTRAPETROL (BAHAMAS) LIMITED

                                               By: /s/ Filipe Menendez R.
                                                   ---------------------------
                                               Name:Filipe Menendez R.
                                               Title: Attorney-in-Fact

Accepted and Agreed:

LAIF XI LTD.

By: /s/ Katherine A. Downs
    ---------------------------
Name: Katherine A. Downs
Title: Attorney-in-Fact

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00110-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00110-of-00352.parquet"}]]